THE LEDE: The chairman of the Senate Judiciary Committee's antitrust subpanel, Sen. Herb Kohl (D-Wis.), came out against AT&T's proposed $39 billion acquisition of T-Mobile USA on Wednesday in a seven-page letter to Federal Communications Commission Chairman Julius Genachowski and Attorney General Eric Holder, urging them to block the transaction. Kohl laid out an exhaustive argument against approving the transaction, arguing it would harm consumers, lessen competition in a crucial sector and ultimately leave the wireless market in the hands of AT&T and Verizon Wireless. He dismissed AT&T's promise to build out its next-generation mobile broadband network as speculative and closed by noting the merger would effectively reverse the breakup of Ma Bell in the 1980s.
Opponents of the merger such as Public Knowledge, DISH Network and competitor Sprint hailed Kohl's opposition while AT&T and T-Mobile remained confident the merger will be approved. The Communications Workers of America issued a statement arguing there is no future for T-Mobile as a standalone firm and that AT&T would be a preferable merger candidate because of its unionized workforce. More than 70 House Democrats have already backed the deal publicly, but three of the more prominent members of the caucus called it a backward step for public policy on Wednesday.
"Sprint shares Senator Kohl's extensive concerns and believes that the growing chorus of concern from policymakers, public interest advocates, and industry officials, along with tens of thousands of consumers who have filed objections with the FCC, cannot be ignored by the DOJ and FCC. In spite of AT&T's ongoing campaign to convince the public that this takeover is already a done deal, we are confident that, like Senator Kohl, the DOJ and FCC will see this takeover for what it is — a bad deal for consumers, competition, and our nation's economy." —Vonya B. McCann, SVP for Government Affairs, Sprint
"T-Mobile has been losing market share and customers, and has experienced declining profits and revenue since 2008. Its own CEO made clear in testimony before a United States Senate subcommittee that there would be no further investment in T-Mobile USA that would enable the company to provide the 4G service that is necessary to be competitive in this industry. T-Mobile was up for sale." —Communications Workers of America in an emailed statement
House panel approves data security bill: Brendan Sasso reports that Republicans pushed a data security bill through a House subcommittee Wednesday despite complaints from Democrats that the measure does not do enough to protect consumer privacy. The SAFE Data Act, sponsored by subcommittee Chairman Mary Bono Mack (R-Calif.), would establish a national standard for when companies are required to notify consumers that their personal information has been hacked. The bill would require companies to notify consumers within 48 hours of discovering their information was breached, and gives the Federal Trade Commission authority over nonprofits for the purposes of the bill.
Latest on News Corp.: The phone-hacking and bribery scandal continued to dog News Corp. in Washington on Wednesday as two separate letters from Senate Democrats called for more scrutiny on the owner of The Wall Street Journal, New York Post and Fox News, among others.
Sen. Frank Lautenberg (D-N.J.) wrote the Justice Department to remind it of a 2005 letter he sent on behalf of the marketing firm FLOORgraphics, which accused News Corp. subsidiary News America Marketing of hacking into its system to obtain confidential business data. News Corp. reportedly settled the case in 2009 for almost $30 million, and bought the firm soon after.
Sens. Jay Rockefeller (D-W.Va.) and Barbara Boxer wrote separately to the members of the Special Committee created to oversee Dow Jones as a condition of its 2007 sale to News Corp. by the Bancroft family. The letter primarily concerns the hiring of former Dow Jones CEO and Wall Street Journal publisher Les Hinton in 2007 following his tenure as executive chairman of News International during the time of the alleged criminal activities. The senators argue recent reports have called into question Hinton's previous testimony on the phone-hacking incidents, and ask whether Dow looked into the incidents or expressed any concerns before hiring Hinton in 2007.
Lawmakers rally for public-safety network: Lawmakers appeared with 9/11 first responders at a press conference on Capitol Hill on Wednesday to push for a measure that would allocate a section of spectrum known as the D block to first-responders. Senate Commerce Chairman Jay Rockefeller (D-W.Va.), the bill's author, has said he wants to pass legislation creating the public-safety network before the 10th anniversary of the attacks.
Opponents of the bill argue that the government should auction the valuable D block spectrum to commercial providers instead of allocating it. They argue that an auction could raise billions of dollars for the federal government to pay off the nation's debts and to fund a public-safety network for first-responders. In response, Rockefeller and co-sponsor Kay Bailey Hutchison (R-Texas) pointed to a CBO score released Wednesday that found the bill (S.911) would reduce the deficit by $6.5 billion.
Identity theft bill passes: The House Judiciary Committee reported a bill that would increase the penalties for identity theft on Wednesday after a lengthy markup that featured several Democratic amendments that were ultimately rejected.
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