@jbtaylor on tech

The Oct. 29 New York Times has a story about a T-Mobile customer whose cell phone was stolen when they were traveling outside of the U.S. for work. The customer immediately reported the phone as stolen, but still got hit with a $25,000 phone bill.

The customer and the reporter were wondering exactly how that could have happened. All good questions, but what the reporter doesn't understand is that privacy laws prohibit what that T-Mobile spokesperson can say about the incident.

Even though the customer share a copy of his invoice with the New York Times, privacy laws prohibit T-Mobile from answer questions about it.

And I can tell you, when you're the PR person handling a reporter's questions, journalists tend to believe you're lying when you say this. They're asking very reasonable questions and they're not sure why you don't answer them.

The truth is you can't.

The other thing you can't do is dispute what a customer has told a reporter. So when the reporter has heard only one side of the story, it's difficult for them to do their job.

In this particular instance, where the $25,000 bill was incurred in three days, T-Mobile's lawyers did allow the PR representative to say that bill skyrocketed because the thieves used it for conference calling, but that's all the PR rep. was allowed to say.

So here's what else the reporter and the readers of this story don't likely understand. In this case, the T-Mobile system detected the fraud and automatically shut off the phone before the customer reported the phone as stolen.

So why did the T-Mobile billing system still issue an invoice? My guess is the fraud detection system isn't integrated with the billing system and I'm betting that the billing cycle for the customer coincided with the false charges. (And I bet integrating the systems would cost tens of millions of dollars to complete.)

So when the customer called Care, I'm betting that the poor care rep. was just doing their job and didn't escalate the customer to a manager who could have investigated further, and realize that invoice was issued in error.

All that said, that's just my guess.

I don't believe anyone at T-Mobile ever expected that bill to be paid and I'm sure the PR person wanted desperately to tell the reporter the whole story, but privacy laws prohibited that from happening.

In fairness to T-Mobile, the customer was not held responsible for the bill. But I do have to wonder, if the reporter knew a bit more about the privacy laws that govern the wireless industry, as well as the complex wireless billing systems, would he still have chosen to write this story?

Sometimes in this blog, I wonder if I'm writing too much about AT&T's bid to takeover T-Mobile. Reporters tell me they are tired of the story. I'm tired, too.

But every time I think we've hit a quiet lull in the news coverage of this fight, AT&T's PR and lobbying shop fills in the void.

Consider this statement by Jim Cicconi, AT&T's top lobbyist. Cicconi, didn't like a filing that Sprint made at the FCC yesterday one bit. Here's what he told Politico yesterday:

"Being accused of inconsistency by Sprint is like being called ugly by a frog, They've raised to an art form the practice of saying one thing to Wall Street and another to regulators, and of making wild assertions without a shred of factual support."

Think we got under Cicconi's skin?

So that begs the question, what did Sprint actually say the FCC which upset AT&T and Mr. Cicconi so badly?

Basically we pointed out how AT&T, Deutsche Telekom and T-Mobile have said one thing to Wall Street and something completely different to Washington. We also pointed out that AT&T, in particular, has made numerous unsubstantiated claims about the T-Mobile takeover to the public and in filings to the FCC, it has hidden the details of these claims behind the Commission's protective order so the public is not aware of what the whole story is.

As Sprint said in its FCC filing:

"AT&T has spun one story to the public, while the facts it has hidden from the public tell quite a different story; it has told one version of its story in Washington, yet a vastly different version on Wall Street."

And contrary to Mr. Cicconi's claim that Sprint is, "without a shred of factual support," Sprint provided 33 citations in the public record which support Sprint's filing - many of the citations reference Mr. Cicconi's own words and those of AT&T's CEO Randall Stephenson.

Perhaps instead of seeking to insult Sprint (and frogs), AT&T would be better served in clearing up the inconsistencies it has created in the public record.

I've worked in Washington on and off for over 20 years and I've seen all kinds of lobbying blitzes, political campaigns and issue advocacy efforts, but I've never seen as much smoke blown in the face of the media and public as AT&T has blown in its effort to secure approval of its proposed takeover of T-Mobile.

It's truly breathtaking.

Today, it was revealed that AT&T is trying sell some of its vast spectrum holdings. On its face, that's just fine, except that one of the fundamental reasons behind the proposed T-Mobile purchase was to get MORE spectrum.

So which is true?

And does AT&T really think the FCC is that stupid? (I'm guessing yes.)

On Monday, Oct. 24 in U.S. District Court in Washington, D.C., attorneys for AT&T and Deutsche Telekom presented oral arguments asking the Court to dismiss antitrust lawsuits filed by Sprint and C Spire Wireless seeking to block AT&T's proposed takeover of T-Mobile.

The courtroom was packed to the gills will all kinds of lawyers and lobbyists and the proceeding was lengthy. Several reporters who reported stories today did so before the proceeding completed -- the exceptions where the wire services -- Bloomberg, Reuters and Dow Jones. I'd recommend their coverage of today's events instead of those who left early.

In layman's terms -- and Lord, knows, I'm no lawyer -- here's what happened:

Judge Huvelle heard arguments about AT&T's motion to dismiss the Sprint and C Spire cases, but made no decision about granting or denying the motion. At various points in the arguments, she was skeptical of what the lawyers for both sides were saying. so I think it would be a mistake to predict what her final ruling will be. Regardless of the outcome here, it's important to note that the merits of the Justice Department's case against AT&T, Deutsche Telekom & T-Mobile were not discussed. The arguments focused on one narrow procedural question: will the proposed takeover of T-Mobile injure C Spire and Sprint? If she decides there is injury, the cases move forward. If she decides there is no injury, AT&T has one less legal hurdle to overcome.

The second motion which was argued went even deeper into the legal weeds. But honestly, it wasn't that hard to understand if like me, you got some sort of a briefing in lay terms before the court proceeding began. The basic question debated was this: who gets what confidential documents from AT&T, T-Mobile and Deutsche Telekom when?

Here's the backstory on the second motion:

When the Department of Justice conducted its law enforcement investigation into the legality of AT&T's proposed takeover of T-Mobile, it collected millions of pages of documents. This evidence led the Department to determine that the proposed transaction was illegal.

By right, AT&T, Deutsche Telekom and T-Mobile are entitled to all of this evidence and they got it all shortly after the lawsuit was filed. Included in that stack of documents were 2.2 million pages of evidence from Sprint.

Now remember, Sprint has sued AT&T, and in a normal lawsuit, Sprint would be able to begin gather documents from AT&T. But in this case, the judge has ended up delaying Sprint's case because she is entertaining a motion to dismiss the case altogether.

Sprint argued that this decision gives AT&T a huge advantage. Attorneys for AT&T can use those 2.2 million pages of documents from Sprint that Department of Justice provided, but meanwhile nothing requires AT&T to give even one page to Sprint.

So even if Sprint beats back AT&T's motion to dismiss, it will be almost a month behind AT&T in reviewing and analyzing evidence from AT&T. To make matters even more unfair, AT&T has subpoenaed Sprint for even more documents -- some dating back to 2005. Judge Huvelle said AT&T's request was, "overwhelming" and she urged the company to withdraw the subpoena.

At the end of the session, the Judge decided to keep the protective order intact, but to grant the Justice Department the ability to come to the court to get permission to share specific AT&T documents with Sprint and C Spire. This will be an interim measure until the motion to dismiss is resolved.

Still with me?

The judge at several points in the session readily admitted she didn't understand some of the basic elements of the wireless industry such as how handset makers strike deals with carriers, how carriers agree to roaming arrangements and how carriers rely on landline companies to provide wireless backhaul or special access.

So she can climb the learning curve, Judge Huvelle asked both DOJ and AT&T to provide her with a series of 10 page memos on these topics. Those are due in November.

That's about it. So why, you may ask, do I have a photo of fog to go along with this post? Well, because AT&T's lawyers did a fantastic job today of fogging up the issues at hand. There were several points where they simply didn't tell the whole truth or in other cases they deliberately misled the judge.

I think that was a mistake they will eventually regret. The fog they created in the courtroom today will eventually lift. And when it does, the judge won't deal kindly with those who misled her.

This week, the FCC sent a firmly worded letter to AT&T, demanding the company substantiate the claims that it, Deutsche Telekom and T-Mobile have repeatedly made which say that AT&T's proposed takeover of T-Mobile will create jobs.

In other words, the FCC is calling out AT&T for its B.S. as well they should.

In response, late today, AT&T issued another PR statement which touted this promise that the company will relocate 5,000 foreign call center jobs to the U.S., but only if the transaction is approved.

Every time they make that statement, I'm reminded of what one government official said in response to that news when it was first announced:

"We should distinguish between patriotism and extortion."

I couldn't agree more.

In this case, if AT&T wanted to bring these jobs back to the U.S. they could do so today. This is simply a cynical ploy by a company desperate to make a big deal which will be great for AT&T shareholders, but screw everybody else.

That said, I agree that this proposed transaction has created jobs and as the title of this post suggests, they all belong to lobbyists, investment bankers and antitrust lawyers -- and also the PR people who have advised the company that repeating discredited and false claims about jobs being created is a smart strategy.

AT&T can do better and so can the American people.

p.s. Please remember that this is my personal blog and that these views do not reflect the views of my employer.