FCC to accept withdrawal of AT&T, T-Mobile merger (updated)

The Federal Communications Commission is expected to accept the withdrawal of AT&T and T-Mobile’s merger application, clearing the way for the companies to concentrate on their separate antitrust battle with the Justice Department. The companies hope to win their federal lawsuit against Justice and then reapply for their merger with the FCC. The agency is also expected to announce the release a report on its findings from its merger review — a move the companies have protested because the findings could influence the Justice Department’s separate lawsuit against the merger in the U.S. District Court of the District of Columbia.

The wireless giants argue that to release the report would go against FCC protocol. Dick Wiley, AT&T’s outside attorney, called FCC Commissioner Mignon Clyburn, saying that the merger application has already been withdrawn and that any documents related to the agency’s review of the deal should remain sealed. “Releasing staff workproduct concerning a matter no longer before the Commission would be unprecedented,” Wiley said in an ex-parte filing with the FCC. “In this case, the workproduct is highly deliberative in nature as it is a draft for consideration by the Commissioners that, if finalized and approved, would merely provide the basis for issues to be considered by an Administrative Law Judge. This workproduct would in no way constitute official findings of the Commission.”

Update:

The FCC staff report says AT&T failed to make the case that the merger would create up to 96,000 new jobs in the U.S. and allow the carrier to roll out 4G service to an additional 17 percent of the U.S. population. Instead of increasing jobs, the merger would likely lead to major layoffs as the combined company cut duplicative positions, FCC officials said Tuesday.

AT&T and T-Mobile did not "attempt to give specifics or quantify their claims with respect to the number of indirect jobs that will be crated by the proposed transaction, making it impossible to assess whether any indirect employment gains, even if transaction specific and realized, will outweigh the direct employment losses," the staff report said.

The FCC cannot consider indirect jobs that "might" be created as a benefit "in the absence of concrete evidence," the report said.

Read the Order http://transition.fcc.gov/transaction/DA-11-1955.pdf

Read the staff report http://transition.fcc.gov/transaction/ATT-TMO-redacted-PDF-final.pdf