AT&T to fight 'dire predictions' in T-Mobile buyout

AT&T plans to argue that wireless competition is robust and consolidation inevitable as it works to usher its purchase of T-Mobile past regulators at the Justice Department and the Federal Communications Commission (FCC). 

AT&T's top policy executive, Jim Cicconi, said in an interview Sunday that he is prepared to confront the serious competition concerns that may be raised on Capitol Hill and in the administration.  

"I think there's an argument that, one way or another, consolidation would've occurred in this direction," Cicconi said. 

He added: "You start out hearing dire predictions about the impact on consumers, but almost none of those have proven true in the wireless industry." 

Congressional Democrats have objected to what they view as a dangerous lack of competition in the mobile service market. Senate Commerce Chairman Jay Rockefeller (D-W.Va.) promised Sunday to scrutinize the deal, and urged federal regulators to "leave no stone unturned" in their reviews.  

"Obviously we understand the questions and the concerns and we feel we have good answers," Cicconi said. "We took a very hard and close look at this and we feel the facts support the deal." 

Consumer groups are already urging the government to block the deal, saying the market lacks competition. The top four wireless carriers, including T-Mobile, serve more than 90 percent of wireless subscribers, according to a Government Accountability Office (GAO) study released in August.  

Cicconi downplayed that concern, arguing that competition is strong in the wireless marketplace. 

"There is a great deal of competition in just about every market and T-Mobile isn't even the number four in every market," he said. "Competition is robust in the wireless market and this merger won't change that." 

He noted that the company is being "realistic" about prospective conditions. 

"I think the biggest thing I'd like people to focus on is the public interest benefits [of the transaction]," Cicconi said. He cited President Obama's call for wireless broadband to reach all Americans and noted that wireless prices have dropped over the last decade. 

The company pinged the FCC about its plans — Chairman Julius Genachoswki got a call from AT&T chief executive Randall Stephenson. 

Genachowski is thought to have a positive relationship with Cicconi. While Verizon sued the FCC over Genachowski's signature item — net-neutrality rules — AT&T offered qualified support.  

A good call, in hindsight?: "I think my answer would be: I never relish going to court with the FCC under any circumstance," Cicconi said. 

The FCC has yet to comment on the merger. Republican Commissioner Meredith Baker says she hopes the FCC review will be "careful, timely and focused on competitive issues directly related to the proposed transaction." She has previously critiqued the agenda-oriented direction of FCC merger reviews.