August 27, 2011

FCC Restarts AT&T, T-Mobile Merger Review


In a letter sent to AT&T legal counsel on Friday, the Federal Communications Commission (FCC) announced that they had restarted their clock on the company's proposed purchase of rival T-Mobile.

According to Sinead Carew and Jasmin Melvin of Reuters, the FCC had originally started reviewing the deal in late April, but put the process on hold on July 20 after AT&T told them they planned to "submit new arguments to support its application."

In the letter, FCC Wireless Telecommunications Bureau Chief Rick Kaplan explained that they had stopped the clock "in view of AT&T's announcement that it had developed and would be submitting new models to bolster its arguments concerning the size of the efficiencies made possible by the merger as weighed against the potential anti-competitive effects."

"We indicated that we would restart the informal clock when AT&T submitted the new evidence in a format and with sufficient explanation and back-up information to enable us, and third parties entitled to have access to the information, to evaluate it," he added, confirming in the letter that the bureau had conducted multiple meetings with AT&T and had received both that information and "further clarification" on a number of different questions they had submitted to the telecom company.

Kaplan said that Friday marked the 83rd day in the FCC's review.

"We are pleased that the FCC has restarted the clock and we are confident that the commission will move expeditiously to complete its review of our merger with T-Mobile, " AT&T senior vice president for federal regulatory matters Bob Quinn said in a statement, according to a report by Michael J. De La Merced of the New York Times' Dealbook blog.

"There is a lot riding on the FCC's decision," Don Reisinger of notes. "When AT&T announced earlier this year that it intended to acquire T-Mobile USA for $39 billion, several lawmakers, along with competitor Sprint, spoke out against the deal, saying that it would create an anticompetitive environment in the mobile space."

"For its part, AT&T has argued that it can deliver better service to customers with the deal," he added. "The company has especially highlighted its ability to offer LTE high-speed wireless service to 95 percent of the U.S. population if the deal is approved.

Following the FCC's review, AT&T's proposed $39 billion dollar purchase of T-Mobile must also be approved by the Justice Department. According to Carew and Melvin, officials at AT&T expect the entire process to be finalized by March of next year.


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