AT&T withdraws T-Mobile aquisition application at FCC

AT&T withdraws T-Mobile aquisition application at FCC


as originally posted by Karl Bode at

Hoping that the tryptophan roar of the Thansgiving holiday would take the public relations sting out of the move, AT&T and Deutsche Telekom this morning announced that the company would be withdrawing their application at the FCC to acquire T-Mobile. The move comes after the FCC this week announced they’d be holding a hearing on the merger, placing another deal hurdle in AT&T’s already troubled path. According to the two companies press statement, they insist they’re making the move to “consolidate their strength” in order to focus on their upcoming legal battle with the FCC:
This formal step today is being undertaken by both companies to consolidate their strength and to focus their continuing efforts on obtaining antitrust clearance for the transaction from the Department of Justice. As soon as practical, Deutsche Telekom and AT&T intend to seek the necessary FCC approval.

What’s actually happening? Under generally accepted accounting principles (GAAP), AT&T has to record the $4 billion break up fee if their auditors believe their attempted takeover of T-Mobile has less than a 20% chance of success. With ongoing lawsuits against both the DOJ and Sprint, severe public backlash against the deal and growing opposition at the FCC, AT&T’s number crunchers are clearly predicting the deal probably won’t happen. If it does still occur, it’s certainly not going to be in its current form, and AT&T still has a very steep mountain to climb to achieve their previous dreams of greater market dominance.

AT&T’s problems all stem from the fact that their repeated claims of deal benefits have been simply too unbelievable to swallow, even for factually-challenged politicians with often mindless loyalty to their wealthiest constituents. AT&T lobbyists have been using every sleazy trick in the lobbying book to try and convince the public, media, and regulators that the deal would create jobs, expand AT&T’s wireless network and even help the nation’s homeless puppies.

However, history, AT&T’s own public statements, and leaked documents¬† clearly show that a T-Mobile deal would actually reduce overall network investment, result in significant redundant job reductions, and despite repeated breatheless claims by AT&T — is absolutely unnecessary for AT&T to fully deploy next-gen wireless services. While the deal would provide AT&T with some useful assets (albeit the lion’s share redundant), AT&T’s real goal was the elimination of T-Mobile and the weakening of Sprint — a move even the nation’s pay-to-play government hasn’t been able to ignore.

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