CCIA Files Petition With FCC Asking To Deny AT&T Merger

BY CCIA Staff
May 31, 2011

The Computer & Communications Industry Association, which has advocated for 39 years for competition policy that fosters innovation and allows the next start up and smaller competitors to have a chance to succeed, filed a petition with the FCC Tuesday asking it to deny AT&T’s proposal to take over its competing wireless carrier, T-Mobile.

Technology companies from handset makers to gaming systems to Internet applications increasingly depend on wireless access to reach their customers. They need spectrum and Internet users need the ability to reach the wireless apps of their choice, so the merger, giving AT&T more power and control over these elements is a threat – given AT&T’s past anticompetitive behavior.

CCIA was actively involved in the original breakup of AT&T in 1984, which helped create a dynamic and competitive environment that has allowed numerous innovations like Skype and the iPhone to flourish. CCIA offered FCC examples of AT&T’s past anticompetitive behavior in its petition and asked that the government block the merger.

The following statement can be attributed to Ed Black:

“CCIA used the FCC’s own market data in its “Fourteenth Report” to illustrate the market concentration that would result from this merger and why it should be denied. If wireless competition were allowed to further erode there would be few remedies to get it back. We urge others who are wary of over regulation to also oppose this merger so that greater regulation is not needed down the road to clean up the mess this merger would create.

“Innovation from operating systems to handsets could be held back or blocked from ever reaching the marketplace. AT&T has blocked numerous innovations that have competed with its business model in the past from fax machines to cell phones and this brazen merger proposal makes it clear they are once again seeking market power which will allow them to hold back innovation and maximize profits. Why would we once again install them as gatekeeper?

“AT&T says it is facing a spectrum crunch, despite being the largest spectrum holder in 21 major markets. AT&T got into this position because it failed to invest more fully in its network. They may try to argue that they’ll be good this time, stop warehousing spectrum and build out to rural areas. But why is that credible, given their history and track record?”

“There are no conditions available to the Commission that would allow the second largest wireless carrier to buy the fourth largest carrier and still meet the test for somehow being in the public interest. It is not. No amount of lipstick, lobbying tactics by AT&T or legal maneuvering with conditions can change the facts of this case. This merger would raise prices for consumers and small businesses with mobile phones and Internet connections and dampen innovation. It is contrary to antitrust law, and against the public interest and must be stopped.”

“As the FCC reviews competition in the wireless market, AT&T’s history and its own precedent in prior mergers, we believe they will conclude that this proposal SHOULD be summarily denied. We hope the Commission quickly grants our petition and the similar ones from others in industry and consumers’ groups so that the competitive damage to T-Mobile during this consideration is minimized.”

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