AT&T will face off against opponents to its acquisition of T-Mobile USA in a Senate hearing today, where the company will defend the deal before lawmakers.
In written testimony provided ahead of the hearing, AT&T President and CEO Randall Stephenson dismissed claims that the merger would be detrimental to competition and raise prices for consumers.
“The combination of AT&T and T-Mobile could not possibly derail the powerful forces of competition in one of the nation’s most competitive industries,” he said.
Stephenson said in his prepared remarks that T-Mobile customers would be allowed to retain their existing rate plans after the merger or switch to an AT&T plan. He also reiterated AT&T’s prior arguments that the merger was necessary to keep up with rising data traffic and would allow the company to expand its LTE deployments to new markets.
AT&T has received support for the massive $39 billion acquisition from unions, including the Communications Workers of America (CWA), and civil rights groups, including the NAACP.
T-Mobile and CWA are slated to testify in favor of the merger at today’s Senate hearing. Sprint, Cellular South and public interest group Public Knowledge will testify in opposition to the deal.
“We think this transaction is bad for consumers, bad for the wireless industry and bad for the American economy,” said Sprint spokesman John Taylor. Sprint CEO Dan Hesse did not provide written remarks ahead of his verbal testimony today.
Hu Meena, president and CEO of Cellular South and chairman of the Rural Cellular Association, said in his prepared testimony that AT&T and Verizon Wireless were on the path to becoming the “2 Bell Sisters of the wireless industry,” a reference to AT&T’s former landline telephone monopoly.
“It must be stopped,” Meena said. “The fate of this acquisition determines the course of our industry. It’s as simple and as critical as that.”
If regulators approve AT&T’s merger with T-Mobile USA, AT&T and Verizon Wireless will have a combined market share of nearly 80 percent in the U.S. wireless market.
Meena stated that AT&T had used its scale for “routine abuse of market power.” He said the company had withheld roaming agreements from its competitors, used its size to Balkanize spectrum used for LTE deployments, and said AT&T’s lengthy handset exclusivity deals restricted competitors and consumers from accessing devices.
AT&T has repeatedly stated that it willingly negotiates roaming agreements with its competitors and has dismissed regional operators’ complaints about lack of interoperability in the 700 MHz band, which is used for LTE.
Public Knowledge’s Gigi Sohn questioned AT&T’s rationale for the acquisition in her prepared remarks.
“It is particularly striking that every single public interest benefit AT&T has claimed as a result of the merger can be accomplished without removing a competitor,” she said. “Expansion of 4G coverage to overlap their current 2G and 3G network coverage of 97 percent and improving their network capacity are already possible and therefore are not merger-specific benefits.”
Sohn wants regulators to block the deal on the grounds that it is anti-competitive and does not serve the public interest.