DOJ, AT&T and Latinos: What Now, and What’s Next?
Jason Llorenz, Esq. (twitter: @hispanicttp)
As has been widely reported, the Department of Justice just took a week that is traditionally quiet in Washington, and turned the telecommunications industry and the multitude of advocates who follow one of America’s growing, profitable, job-creating industries, on its ear. AT&T’s planned acquisition of T-Mobile for $39 billion is another example of national Latino leaders carefully, thoughtfully examining the facts of the deal, and ultimately, widely supporting the transaction, expecting that, in ongoing DOJ and FCC review, conditions on the transactions’ close (which could include any number of concessions, from sale of portions of AT&T or T-Mobile’s assets, to ceding spectrum to competitors) would result in a transaction that could strengthen and expand the mobile broadband marketplace, make good, efficient use of limited spectrum resources, and save the jobs of more than 20,000 T-Mobile workers who remain in the lurch as T-Mobile faces failure and a longer period of uncertainty. These goals are key to Latinos’ interests. And so, what now?
First, DOJ action takes this to a judicial proceeding that all agree is uncertain . Antitrust review has not been a subject of comment by HTTP members and the other Hispanic organizations who weigh in on this transaction. But what has always been at the crux of the value of this deal for this coalition and other supporters, is that the AT&T purchase offered an opportunity to 1) expand the opportunity to unionize to T-Mobile workers, 2) to add to AT&T’s industry-leading supplier diversity program, which delivers billions of dollars to Latino, African American, and women and other minority-owned small business around the country, and 3) to expand high-speed, wireless broadband access to millions of communities who are on the wrong side of the digital divide. These are important goals that were to be accomplished through this deal.
While the transaction is not dead, one must hope that any negotiations that take place with the DOJ’s anti-trust division continue to consider the opportunities presented for Latino entrepreneurship and expanded job creation and security in the deal. Speculation on alternate buyers feature several experiments – including a cable industry conglomeration, purchase by Apple or Google or a group of VC investors. None of these offer the record of AT&T in community investment, diverse hiring, nor supplier diversity – which must continue to be the focus of any analysis of this deal, proposals to salvage it, or new entrants to purchase.
Robust government review of this, and any deal is expected, but the DOJ’s action this week stymies the Latino community’s efforts to continue advocacy on the deal to ensure its ultimate structure would benefit this community.
Lillian Rodriguez-Lopez, President of Hispanic Federation, an HTTP member, said it best:
The Justice Department’s action seems premature and perplexing given the level of public discourse currently underway across the country on the merger. More than most groups, Latinos depend on wireless and mobile broadband connectivity; and our organization, like many, was focused on fully reviewing the merger and advocating where necessary for enhanced benefits and protections for our community…
Detractors have fiercely worked to derail this deal, many of which claim victory this week, as if T-Mobile has been saved, jobs guaranteed, and investments secured that would keep T-Mobile a viable entity. In truth, the hard questions of what happens to T-Mobile without the investments that would have come with the proposed merger remain more important than ever. If the AT&T transaction ultimately fails, will new buyer(s) of T-Mobile come to the table with a commitment to supplier diversity? What about treatment of its workforce or expedient investment to expand high-speed broadband? Important for those claiming a win this week — can T-Mobile’s pricing structure remain while securing similar commitments to bring 5,000 call center jobs back to American shores, as AT&T did this week? The answers to many of these questions are likely to be a resounding “no.” And that may be a net loss to this community.
Jason Llorenz, Esq. is Executive Director of the Hispanic Technology and Telecommunications Partnership (HTTP)