@jbtaylor on tech

Mark your calendars. The Senate Antitrust Subcommittee is holding a hearing on Verizon's proposed transactions with Comcast, Bright House, Time Warner Cable and Cox on Wednesday, Mar. 21 at 2:00 ET.

The hearing will be webcast live from the Judiciary Committee's web page or you can attend in person in Room 226 of the Dirksen Senate Office Building in Washington, D.C. The title of the hearing is telling:

"The Verizon/Cable Deals: Harmless Collaboration or a Threat to Competition and Consumers?"

It looks like a good panel of witnesses. Testifying before the subcommittee will be:

Randal S. Milch
Executive Vice President & General Counsel
Verizon Communications Inc.

David L. Cohen
Executive Vice President
Comcast Corporation

Charles F. (Rick) Rule
Managing Partner, Washington, DC Office
Cadwalader, Wickersham & Taft LLP

Steven K. Berry
President & CEO
Rural Cellular Association

Joel Kelsey
Policy Advisor
Free Press

Timothy Wu
Isidor & Seville Sulzbacher Professor of Law
Columbia University

The FCC is currently reviewing a massive spectrum transaction where Verizon Wireless will acquire spectrum held by cable companies Comcast, Cox, Time Warner Cable and Bright House. In exchange, Verizon will begin to market cable services in Verizon stores, online and telesales channels. At the same time, the cable companies will start to market Verizon Wireless services.

The details of these joint marketing agreements are central to the proposed transaction, but the attorneys from Verizon and the cable companies are refusing to allow the FCC to see the details of the agreements.

They have decided that the FCC has no jurisdiction over the matter and in regulatory filings last week, basically told the FCC to butt out.

This morning, Sprint joined T-Mobile, DIRECTTV, Free Press, Public Knowledge, Media Access Project, the Computer & Computing Industry Association, the New America Foundation, RCA-The Competitive Carriers Association and the Rural Telecommunications Group in asking the FCC to stop the informal 180-day clock on its review of the proposed transaction until the FCC can review the full and unredacted details of the proposed transaction.

Put simply, what Verizon and the cable companies are essentially telling the FCC is, "Trust us."

And what the other companies and public interest groups are asking the FCC to tell Verizon and its cable partners is just as simple: "Trust, but verify."

And honestly, no one at Verizon, Comcast, Bright House, Cox or Time Warner Cable should have anything to fear if their proposed transaction is truly as pro-consumer as they purport it to be.

But by hiding the details which are central in determining whether or not the transaction is in the public interest, it certainly raises serious questions about the nature of the transaction and the motivation behind it. Otherwise, why is there a need to hide the details from the independent agency in charge of regulating the cable and wireless industries?

p.s. While other companies have formally asked the FCC to deny the transaction, Sprint has not done so. Like other posts on this blog, the opinions expressed are entirely mine, and not necessarily those of my employer.

Last week we learned the truth about AT&T's plans to bring 4G to rural America.

Media reported that a confidential AT&T document reveals that the company considered, and then rejected, a $3.8 billion plan to expand its future 4G network to cover 97 percent of Americans. The document also revealed that this $3.8 billion plan was rejected before AT&T proposed the takeover of T-Mobile for $39 billion.

This revelation puts AT&T in a political bind.

You see, AT&T and T-Mobile executives, along with officials from AT&T's unions, have repeatedly told elected officials that the ONLY way rural America was ever going to see 4G was if the government approved the T-Mobile takeover.

Some politicians took AT&T's claims at face value and expressed public support for the transaction.

Now of course we know that AT&T misled these elected officials. Taking over T-Mobile is not the ONLY option AT&T has.

That's why the consumer advocacy group Free Press wrote a letter to a group of Members of Congress supportive of the T-Mobile takeover, telling them that AT&T had misled the officials.

What does AT&T have to say in response?

You better sit down.

“Once again, Free Press is twisting words and misrepresenting facts,” an AT&T spokeswoman told The Hill newspaper. “Simply put, AT&T would not be able to deliver 4G LTE to 55 million more Americans without this merger.”

I'm sorry, but AT&T WOULD be able to deliver 4G to those 55 million Americans and they could save AT&T shareholders $36 billion dollars if the company abandoned its bid to takeover T-Mobile. (The company's own filing at the FCC says it could for a fraction of the cost of swallowing up T-Mobile!)

Let's remember, Verizon is already on the record as promising to cover 98 percent of Americans by 2013. Does anyone honestly believe that if the government blocks the T-Mobile takeover that AT&T will stick with their plan to cover only 80 percent?

I remember those ridiculous Luke Wilson ads AT&T ran and how Verizon made a laughingstock of AT&T when they compared the two company's 3G coverage maps.

I find it hard to believe that AT&T would sit on that $3.6 billion and let Verizon claim it has a bigger 4G network in another round of "there's a map for that" TV ads.

Don't you?

Let's be honest, this proposed transaction has never been about helping rural America. That is merely a political carrot designed to generate political support for the proposed transaction.

I personally believe, from day one, this transaction has been about eliminating a competitor, raising prices for your cell service and cutting jobs from AT&T's payroll.

All of this may be good for AT&T shareholders and the German government which owns a huge chunk of shares in Deutsche Telekom, but it's not good for anyone else.

p.s. Just a friendly reminder that this is my personal blog and doesn't represent anyone's opinions but my own. A fuller discussion of that is found in the "About this Posterous" section of my home page.

On Friday, Sprint CEO Dan Hesse gave a speech in San Francisco where he talked about Sprint's commitment to operating the company in the a greener, more sustainable manner. Sprint has made great strides in recent years and people are taking notice. In its most recent rankings of the greenest companies in America, Sprint was ranked number six.

Dan also talked about how the wireless industry can help the rest of the country's businesses operate in a greener manner, too. Want more employees telecommuting and staying off the freeways? Wireless modems mean people can connect anywhere. Want fewer in person meetings? Try video chats via a 4G connection.

Dan pointed out however that the innovation in the wireless industry that makes this greener future possible was in jeopardy if the government allowed AT&T to takeover T-Mobile.

Media picked up on this, not surprisingly, when Dan said that approval of the T-Mobile takeover would, "stifle innovation and put too much power in the hands of just two carriers," meaning AT&T and Verizon.

Well AT&T's top lobbyist, former Bush White House official Jim Cicconi, couldn't let that stand. He immediately penned a blog post saying Dan's remarks and his point of view were, "way off-base."

• In AT&T's world it's "way off base" to point out that T-Mobile is a low price carrier with a good reputation for customer care and AT&T has high prices and the worst reputation for customer service in the industry.
• It's also "way off base" to point out if this takeover of T-Mobile is approved, AT&T and Verizon will control almost 75% of the wireless market and drive up the prices you pay for wireless service. They also will strengthen their control of the special access market, which is a key cost driver in our industry.
• AT&T also thinks every major consumer group in the country is "way off base" including Consumers Union, Free Press, Public Knowledge and National Consumers League who all oppose AT&T. AT&T always thinks any consumer advocate is "way off base." After all, those are the people who point out just how bad AT&T's network is.
• AT&T thinks the Rural Cellular Association and the Rural Telecommunications Group and the hundreds of their member companies are "way off-base". These are the carriers who joined with Sprint to fight for the ability of consumers to use their smart phones to check email, surf the Net and use Net-connected apps anywhere they travel in America. AT&T thinks those consumers who expect that are "way off-base".

In fact, the more I think about it, AT&T thinks EVERYONE who disagrees with its political agenda is "way off-base".

Here's what I think.

Despite the fact that AT&T spent more than $15 million lobbying Congress and the Obama Administration last year, despite the fact that no company in America gave more in campaign cash to Congressional candidates from 1989 to 2010, despite the fact that AT&T is one of most powerful political forces in American politics, AT&T will lose.

AT&T will lose not because Sprint will beat them. We won't beat them. But you will.

You see, this isn't about AT&T vs. Sprint. This is about AT&T vs. everybody. You know, all those people which it calls, "way off base."

We call them consumers. People like you.

If enough people like you contact the FCC and the Justice Department and Congress and the White House, you will stop AT&T.

But you have to act.

The people I work with at Sprint can never match AT&T's lobbying muscle. AT&T is much too big for that. But AT&T can't stop you, if you care enough to stand up for yourselves.

Here's a post which explains how you can stand up to American Telephone & Telegraph, the corporation who thinks you're "way off base."

As I told Politico last night, I think lawmakers in Washington, once they learn the facts about how this T-Mobile takeover will hurt their constituents, will stick up for consumers and demand that the Department of Justice and the FCC block this deal.

But you have to demand that from your Members of Congress.

AT&T is hoping that you're not paying attention and that if you are paying attention, you won't make the effort to speak out.

Prove them wrong and point out that you think AT&T is "way off-base."

If you do, AT&T will strike out in its attempt to takeover T-Mobile.

Last week, the public interest group Free Press held a policy summit which attracted every telecom policy nerd in Washington, DC, except me. (I has a prior commitment on my schedule.) Of all the speeches given, this one by Free Press's research director Derek Turner, caught my eye because it captures the history of telecommunications and competition over the last several years.

At Sprint, we don't agree with everything Derek said here, but we do agree with his conclusions about why the FCC should act to fix the wireless backhaul market.

What's wireless backhaul you ask? Here's a quick explantion. Most people don't realize that the only wireless part of a mobile phone call is that part where you handset transmits your call to the nearest cell phone tower. The rest of the conversation travels over a wireline network. Moving your wireless call across a wireline (or landline) network is what we call wireless backhaul. (Wireless backhaul is also called "special access" or "the middle mile.")

Because they have territorial monopolies, Verizon and AT&T don't compete with each other to provide wireless backhaul to cell phone companies. In fact they really don't compete with anyone. In the top 50 metro areas where Verizon has a territorial monopoly, it controls more than 90% of the wireless backhaul market in that area. (The same can be said for AT&T.)

Verizon and AT&T can do this because the FCC prematurely deregulated the market for the circuits used to provide backhaul before there was any evidence of signinificant competition. Guess what happened after the FCC deregulated? The landline companies like AT&T and Verizon jacked up their prices considerably. Verizon has markups that are 700% over cost in some areas according to Free Press.

Go to minute 12:47 in this video to hear what Derek has to say about backhaul. He explains it better than I can.