In the “Unrequited Love Department,” AT&T bails on its proposed merger with T-Mobile, following the U.S. Federal Communications Commission’s entry into the fray earlier this week with a proposal of its own: schedule a hearing on the deal before an Administrative Law Judge. The rare move by the U.S. telecommunications regulator essentially presented AT&T with a “lose-lose” situation, given that the U.S. Department of Justice (DoJ) filed suit against the merger in August, which publicly committed to fighting the deal in court as recently as a couple of weeks ago.
Given the double-barreled opposition, the carrier is taking the only path out, given the potential for continued protracted litigation, even if it prevailed against DoJ, and the potential for having a dark cloud follow it in any other regulatory or legislative matter for some time to come.
This is not the same thing as “cloud computing,” but the math adds up to zero, which is the important point, and “Black Friday” may today mean something else, indeed in some quarters.
The move probably also comes as a relief to other carriers, worried from the beginning about the regulatory backlash from any concessions that AT&T might have made to secure the deal’s approval, which then could be applied industry-wide using the logic that “if they can do it, you shall too.”
This, however, is my own opinion.
According to the Barron’s blog linked above, AT&T may seek to acquire some of T-Mobile’s wireless assets. One of AT&T’s talking points on the merger was that it would spend $8 billion on network upgrades as a merger condition, if approved, that the deal would create thousands of U.S. jobs, and the carrier would bring 5,000 call center jobs back into the U.S.
These talking points resonated with the public – I even overheard some farmers at an auction discussing the pros and cons of these finer details before 7:15 AM this past Labor Day, while I was looking for things I really didn’t need to follow me home (as in “towed”) – but on we go to Plan B, while the overall network investment and job creation impact after the announcement is at this time unclear.
