@jbtaylor on tech

On the eve of a bipartisan compromise to extend a middle class tax cut and continue unemployment benefits for our friends and neighbors out of work, Politico described AT&T's lobbyists as, "furious" that Republican and Democratic leaders in Congress didn't adopt everything the company wanted in the legislation.

Remember, with AT&T, it's always "my way or the highway" when it comes to public policy.

Missing from what DSL Reports' Karl Bode called a "pout festival" was like-minded Twin Bell Verizon. I'm guessing that top Verizon lobbyist, former Iowa GOP Congressman Tom Tauke and his team realized what Rep. Anna Eshoo (D-Calif.) said about the compromise over the bill's spectrum provisions was true:

“Did we get every single thing that we wanted? No. No one ever has and I don’t think they ever will, including my children.”

Perhaps AT&T's top lobbyist Jim Cicconi believes that too, but in a statement to media yesterday, he pointed out that there is "an opportunity for a court challenge" if the FCC doesn't give his company all the spectrum it wants.

Lovely.

Before the FCC even opens a docket about the future wireless spectrum auction, AT&T is already threatening a lawsuit if it doesn't get its way.

That sounds like an empty threat to me. The last time AT&T was in court over an effort to obtain more spectrum was when the U.S. Department of Justice and a bi-partisan group of state Attorneys General sued the company over its proposed takeover of T-Mobile.

We all know what happened then.

Rather than fight the government in court, AT&T chose to leave the courtroom and abandon the transaction, rather than stand by its scorched earth rhetoric.

So yesterday's threat from AT&T sounds like more empty saber rattling to me.

Time will tell.

p.s. Once again, please remember that this is my personal blog and may not necessarily reflect the views of my employer.

Kent German, the CNET columnist, always has strongly expressed opinions. This week's column is no exception. Although his rhetoric is unusually charged, I think most consumers share his view that it's time for AT&T to stop whining, which is exactly what AT&T's CEO Randall Stephenson did on AT&T's Q4 earnings call this week.

The company's earnings were hit by the T-Mobile break fee and Stephenson rivaled Jim Cicconi, AT&T's top lobbyist, in his efforts to play the victim card. Stephenson essentially complained that the FCC is out to get his company and everyone else in the industry, refusing to approve mergers and spectrum transactions.

None of that is backed up by facts though.

As FCC officials pointed out in response to media inquiries, the FCC has approved more than 150 commercial mobile transaction applications last year alone and more than 300 in the last two years, including AT&T's nearly $2 billion acquisition of Qualcomm's spectrum.

(I would point out, the FCC refused to apply any of the conditions that competitors and consumer groups had sought for the Qualcomm deal -- AT&T got everything it wanted with the deal. This was the 15th major AT&T deal that the FCC has approved over the last 15 years.)

This whining and cherry picking of facts by AT&T wasn't limited to Stephenson this week. As I pointed out earlier, AT&T's top FCC lobbyist, repeatedly and falsely charged Sprint with "disinvesting" (sic) in its network in Oklahoma and Kansas -- the charges were made in blog posts where the lobbyist whined and complained about the FCC's decision to ensure that data roaming rates are affordable for all consumers.

Mind you, this was an FCC decision supported by every major consumer group and everyone in the wireless industry except for AT&T and Verizon, but AT&T's lobbying team, chose to single out Sprint as some sort of bad actor.

It's laughable in the minds of observers, of course. Many see it as payback for Sprint's role in opposing the T-Mobile takeover in 2011.

While that's an easy conclusion to draw, it's too simple for me. I have a different view.

I don't think AT&T really has a beef with Sprint. Or for that matter, with the FCC. (Sprint and the FCC are mere strawmen.)

No, AT&T's problem is with consumers. When faced with the choice with doing the right thing for its customers or squeezing more money out of consumers wallets, they almost always make the choice which screws consumers.

That's what the proposed takeover of T-Mobile was all about. That's what the Qualcomm transaction was about. That's what the data roaming fight was about. That's what the special access fight is about. I could go on, but you get the point.

And frankly, for far too long, too many of the wireless carriers have followed that path. There's a reason why so many consumers have a love/hate relationship with their wireless carrier.

Fortunately, because of competition, companies like Sprint and T-Mobile and U.S. Cellular and C-Spire and Cricket and Metro PCS are putting pricing pressure on the Twin Bells. This is how competition benefits consumers.

But given the vast resources of the Twin Bells -- be it spectrum, scale, lobbying muscle, manufacturer relationships, advertising spend, you name it -- it's becoming increasingly difficult for other carriers to bring that kind of competitive pressure to the wireless industry.

Sprint's CEO Dan Hesse summed up my personal views best in a conversation with GigaOM's Kevin Fitchard late last year:

"When AT&T announced its intention to take over T-Mobile USA," Hesse said, "It made me realize the industry has been gradually moving toward being a duopoly and how tenuous the competitive situation is in the U.S. wireless industry. . . . [Before the merger was announced] I could see this gradual creep in size and market dominance of the big two — growing gradually each year, though not to the extent that it became alarming. But the attempted acquisition of T-Mobile set off all sorts of alarms and had you step back and notice what’s been happening each year for a number of years."

There was a time in Washington, D.C., where I'd look for groups like Public Knowledge, Free Press, CCIA, RCA, RTG, COMPTEL, Consumers Union, MAP and others to lead the charge in fighting for competition. No doubt, these groups have long stood up for consumers and competition in telecom public policy fights. And they will continue to do so on behalf of all consumers.

But given the consumer outrage over the proposed T-Mobile takeover, the consumer petitions which forced Verizon and Bank of America to back off of new fees, and the unbelievable citizen action to stop SOPA and PIPA, I agree with my friend and colleague Maura Corbett, I think our politics has fundamentally changed.

The interest groups in D.C. still play an important role, but the real power is in the hands of consumers themselves. And that power is far greater than any trade association or public interest group will ever wield.

Businesses, large and small, should not ignore this development. Neither should the politicians.

It's my belief that the smart ones won't.

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Of course, it bears repeating that this is my personal blog and these are my personal views, not those of my employer. For more of a discussion of that, visit my blog's home page.

Media covering AT&T's tantrum over the FCC's decision to make public the results of its investigation into the company's proposed takeover of T-Mobile should know by now that AT&T has repeatedly misled reporters and the public about the facts surrounding this proposed transaction.

The latest example is what AT&T's top lobbyist Jim Cicconi told reporters yesterday about the FCC's decision to release the report on the Commission's investigation into the proposed transaction.

Mr. Cicconi said:

"The decision to issue such a report that has no legal status, without a vote of the Commission, and in a proceeding that has been withdrawn, was also without precedent, and underscores that this was intended more for advocacy and to impact public perceptions. And neither is a proper basis for action by a regulatory agency."

Well, over the last decade, the FCC has released 414 staff written reports that never were voted on by the Commission. So it is simple not true to say that it is "without precedent".

Furthermore, the legal status of the report was established when the FCC voted to approve AT&T's and Deutsche Telekom's request to withdraw their merger application (which is technically an application to transfer spectrum licenses.)

In that order granting the request to withdraw the application, the FCC indicated that the report was "prepared specifically for public release prior to the applicants' filing to withdraw their application." Three of the Commission's four Commissioners issued formal statements strongly supporting this agency action.

What AT&T knows and what it fears is that the courts give great weight to the opinion of the FCC because it is the independent, expert agency charged with reviewing whether or not the proposed transaction is in the public interest. If AT&T doesn't want Judge Huvelle to consider the reports findings, it can and should make that request in court. Just like Verizon, AT&T has a long history of suing the FCC when it doesn't get its way. No one should expect AT&T to abandon its long held legal strategy in combating adverse FCC rulings.

But I go back to this fact: this situation is entirely of AT&T's making. Let's remember, if AT&T didn't want the report to be made public, it could have kept its application on file at the FCC and allowed the matter to go before an Administrative Law Judge.

Now AT&T's lawyers must live with the consequences of a choice which, in retrospect, they likely realize was not in AT&T's best interest.

One last note: it's rather late for AT&T to be concerned about "public perception" surrounding this proposed transaction. Since the proposed takeover of T-Mobile was announced in March, the public has been galvanized against this deal and against AT&T in particular. That's why tens of thousands of individuals took the time to write the FCC to ask it to block this transaction.

Today AT&T's top lobbyist issued a lengthy statement to media complaining that the FCC is being "unfair" in releasing to the public a report on the results of an 8 month investigation into AT&T's bid to takeover T-Mobile.

If AT&T thought this approach would help its case with anyone -- the courts, the FCC, its customers or the general public -- they might want to read the resulting stories.

From Engadget

AT&T blows a gasket, calls FCC report 'an advocacy piece, not analysis'

"You know who's madder than hot fury right now? That guy you picked last on your recreational kickball squad. Also, Jim Cicconi, AT&T Senior Executive Vice President of External & Legislative Affairs.?"

From Ars Technica

AT&T lobbyist: government is out to get us, report "lacks all credibility"

"...now that that both the Department of Justice and the Federal Communications Commission (FCC) have opposed the deal, AT&T's chief lobbyist has bared his fangs."

"...the bellyaching is a bit rich after AT&T's own game playing. The company withdrew its merger petition from the FCC only hours before Thanksgiving Day in what appeared to be a clear attempt to avoid a negative outcome at the FCC. But the FCC, whose staff labored on the deal for months, went ahead and released the report anyway."

From DSL Reports

AT&T angry FCC pointed out just how bad the T-Mobile deal is: Jim Cicconi upset nobody will believe his made up facts this time

"Cicconi is a man whose company has orchestrated one of the largest disinformation efforts in recent history to get their awful deal approved, throwing money at everyone from Cattle Rancher organizations to homeless shelters with the expectations that they'd parrot whatever Cicconi and staff tell them to. Cicconi accusing anybody of factual inaccuracies is like Al Capone criticizing someone for having bad table manners."

"For AT&T to insist anybody is stretching the truth after months of lying is comical."

From Android Police

Hell hath no fury like a corporation scorned: AT&T responds to the FCC's merger report

"Well, AT&T got wind of that report, and they are not happy. Today they responded with all the composure of a rejected middle schooler."

Jim Cicconi, AT&T's top lobbyist, is apparently the company's top economist, too.

Hours after Attorney General Eric Holder told the U.S. Senate that the Justice Department is, "ready and eager to go to court against AT&T," Cicconi goes on a mini media tour repeating the claim that if AT&T is allowed to takeover T-Mobile it will create up to 96,000 jobs.

Of course, that is not true at all.

The study AT&T cites never said that and that claim simply doesn't square with the fact that the company told Wall Street it would eliminate jobs. (That's where the company comes up with $40 billion in merger synergies.)

Karl Bode with Broadband Reports explains it very clearly:

"In fact, the job creation numbers cited rely entirely on AT&T's claim that network investment will be increased as part of the deal, which isn't true. While AT&T and the CWA are busy telling regulators the deal will increase network investment by $8 billion, AT&T is on the record telling investors the deal will reduce investment by $10 billion over 6 years."

Nevertheless, Mr. Cicconi put on his economist hat yesterday and repeated the lies to any reporter who would listen.

My favorite whopper he delivered was what he told Politico Pro (sub. req.). In criticizing research by labor economist David Neumark of UC Irvine, Cicconi says Neumark's research is "the musings of a single professor, who, absurdly, estimates job losses several times higher than the total employment at T-Mobile."

Except Professor Neumark never wrote that and never said that. Ever.

What he did do was to apply EPI's theories about capital expenditures and "job-years."

EPI, the Economic Policy Institute, was asked by CWA, AT&T's union, to conduct a study which would estimate how many jobs would be created based on the assumption that AT&T would invest $8 billion after the company is allowed to takeover T-Mobile.

EPI estimated that up to 96,000 job years would be created in that scenario. A job year is a job that lasts one year.

That is NOT the same thing as creating 96,000 jobs.

At any rate, Professor Neumark looked at AT&T's public statements to Wall Street, which shows an overall lowering of investment (see Karl Bode's article above.)

Using EPI's own logic, and AT&T's own statements to Wall Street, Neumark concluded that AT&T claims about job creation are "unfounded" and that the proposed transaction would actually lead to job losses in the thousands.

That's why the rest of what Cicconi told Politico about Professor Neumark made me laugh:

"Frankly, opponents are letting their fervor cause them to make arguments that are illogical and, in some cases, downright silly."

Actually, that describe what everyone thinks about AT&T and CWA's claims that "up to 96,000 American jobs will be created" with the T-Mobile takeover.

It's downright silly.