T-Mobile Lays Off 1,900 Workers, AT&T Tells FCC "Told ya so"
March 23, 2012 4:30 PM
comment(s) - last by
AT&T still isn't done badmouthing the FCC
Yesterday, T-Mobile made the decision to axe 1,900 workers in the U.S. Most of the layoffs will come from call centers located in Pennsylvania, Florida, Texas, Kansas, Colorado, and Oregon.
T-Mobile USA CEO and President Philipp Humm explained, "These are not easy steps to take — or, I know, to read. We must address our business realities so we can focus on getting T-Mobile back to growth."
AT&T, which has a
serious axe to grind
following the failure of its acquisition of T-Mobile, took the opportunity to kick some mud in the face of the Federal Communications Commission (FCC). Jim Cicconi, AT&T's Senior Executive Vice President of External and Legislative Affairs, made it clear that had the merger gone through, the jobs at T-Mobile's call centers would have been preserved.
"Only a few months ago AT&T promised to preserve these very same call centers and jobs if our merger was approved," Cicconi chided. "We also predicted that if the merger failed, T-Mobile would be forced into major layoffs."
Cicconi didn't stop there, however. He continued his rant against the FCC and didn't hold back any punches:
The FCC argued that the merger would cost jobs, not preserve them, and that rejecting it would save jobs. In short, the FCC said they were right, we were wrong, and did so in an aggressive and adamant way.
Rarely are a regulatory agency’s predictive judgments proven so wrong so fast. But for the government’s decision, centers now being closed would be staying open, workers now facing layoffs would have job guarantees, and communities facing turmoil would have security.
So what’s the lesson here? For one thing, it’s a reminder of why “regulatory humility” should be more than a slogan. The FCC may consider itself an expert agency on telecom, but it is not omniscient. And when it ventures far afield from technical issues, and into judgments about employment or predictions about business decisions, it has often been wildly wrong. The other lesson is even more important, and should be sobering. It is a reminder that in government, as in life, decisions have consequences.
It's understandable why AT&T is still fuming mad over the loss of T-Mobile. The company had to pay a $4 billion USD "breakup fee" when it
decided to walk away from the table
after the FCC made it clear that the acquisition wouldn't be approved. For its part, T-Mobile reported that it
lost 700,000 customers in Q4 2011
. Philipp blamed the lost of customers on its inability to obtain Apple's popular iPhone 4S for its network.
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RE: Not Bloody Likely
3/27/2012 7:26:06 PM
Actually, I believe a Sprint/T-Mobile merger makes more sense than it might first appear. The merged entity would have to continue to operate both a CDMA and a GSM network side-by-side for many years (although there might be some cost-savings and/or improved coverage from consolidating tower locations). But they'd have to do that whether they merge or not
The biggest issue for Sprint and T-Mobile is financing an LTE build-out to match the Verizon and AT&T LTE build-outs. A merged entity would have a much larger customer base to amortize that over than each carrier trying to do it on their own.
The real problem with the merger would be figuring out how to take advantage of the different spectrum that Sprint & T-Mobile own in each market. To take full advantage of T-Mobile's AWS spectrum would require multi-band LTE handsets. Hopefully the phone manufacturers can handle that technically, but Apple alone could probably mess the whole thing up.
"Let's face it, we're not changing the world. We're building a product that helps people buy more crap - and watch porn." -- Seagate CEO Bill Watkins
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