UPDATED 12:26 EDT / AUGUST 09 2011

AT&T Under ‘Monopoly’ Review by FCC, Rivals Take More Jabs

Aside from its plans to buy T-Mobile, AT&T is also looking to acquire Qualcomm’s spectrum.  AT&T may be trying to do too much, as the FCC recently announced that they will combine the review of both deals, as they’re related.

“The commission’s ongoing review has confirmed that the proposed transactions raise a number of related issues, including, but not limited to, questions regarding AT&T’s aggregation of spectrum throughout the nation, particularly in overlapping areas.

“As a result, we have concluded that the best way to determine whether either or both of the proposed transactions serve the public interest is to consider them in a coordinated manner at this time, without prejudice to independent treatment at a later date.” wrote Wireless Telecommunications Bureau Chief Rick Kaplan.

The reason for AT&T wanting to acquire Qualcomm’s spectrum is to bolster its next generation wireless broadband efforts, while the T-Mobile acquisition is for service expansion.  So with the FCC reviewing the acquisitions together, it might not go in AT&T’s favor, as both deals will result in the company’s stronger hold on the communications industry, moving towards a monopoly.

There are supporters and detractors of the merger, from consumers to lawmakers, and Senator Al Franken (D-Minn.) is one of those against the deal.  Franken is concerned what the impact will be for consumers, while two Republican senators, Mike Lee, the top Republican on the Senate’s antitrust subcommittee, and colleague John Cornyn sent a letter to the U.S. Justice Department and Federal Communications Commission stating the benefits of the merger.

“The testimony and materials presented to the Antitrust Subcommittee highlight potential benefits to consumers that deserve meaningful attention…”

While AT&T steadily forges ahead with its merger goals, competitor Sprint is using AT&T’s dilemma in its favor.  Sprint’s new ads for Virgin Mobile prepaid devices show T-Mobile being ‘contractually obliged’ to stand by AT&T’s side.

“It’s a competitive market and we’re not going to shy away from an opportunity to debate things publicly so that consumers can see both sides of a story,” said Virgin Mobile marketing VP Bob Stohrer.

But T-Mobile communications director Hernan Daguerre reacted to the ad, saying Sprint is just feeling a bit threatened.

“And this is because consumers looking for a great prepaid rate plan also want cutting-edge devices on a nationwide 4G network, which is exactly what they get from T-Mobile,” Daguerre said. “It’s flattering to see their marketing efforts center around our advertising properties, but consumers will see right through their gimmicks.”


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