AT&T calls out FCC after T-Mobile USA layoffs
Summary: AT&T rails on the FCC for not heeding its predictions about T-Mobile being forced into major layoffs without approval of the merger.
Just one day after T-Mobile USA announced that it was cutting 1,900 jobs from seven call centers, AT&T is calling out the Federal Communications Commission.
Jim Cicconi, AT&T's senior executive vice president of External and Legislative Affairs, wrote a memo on the AT&T Public Policy blog on Friday detailing the company's stance, which basically rails on the FCC for not approving the $39 proposed bid for the merger.
Considering that the acquisition never came to pass, it might seem a bit strange that AT&T is getting involved. Nevertheless, Cicconi argued that "only a few months ago AT&T promised to preserve these very same call centers and jobs if our merger was approved."
Cicconi added that AT&T already predicted that T-Mobile, the nation's fourth largest mobile provider, would have to deal with a significant number of layoffs.
Cicconi continued:
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. Only a few months later, the truth of who was right is sadly obvious.
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.
Sounds a bit bitter, but perhaps AT&T is right here. Then again, how many layoffs would have taken place at other telecommunications companies, such as Sprint and regional carriers opposed to the bid, if AT&T was able to combine forces with T-Mobile?
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Talkback
That's the problem here
1900 is only the beginning. Enough with the job killing policies please.
That 1,900 less AT&T would've laid off
I know the merger was not liked by many
AT&T makes a phone call to the FCC?
Loss of customers, commiserate with a reduction in headcount is smart business, reduces costs, and allows customers to get less-expensive cell phone service through better management, and making the difficult decisions.
AT&T on the other hand, seems to outsource more, leading to inflated prices in relation to the value of the service they provide. Sprint was concerned about this. Before the AT&T/T-Mobile Announcement, Sprint called AT&T out for bilking its customers.
Also, AT&T, and it's 110+ subsidiaries (see the FCC website for a complete list) is probably more difficult to manage headcount-to-subscriber ratio than AT&T does.
T-Mobile may be more transparent, but that's probably because they're run by Germany-based Deutsche Telekom, and have a German CEO, and as everybody knows, German engineering is typically the best on the planet. It's like comparing Mercedes, or a BMW to a Ford Pinto. Once you hit 170,000 miles, the pinto starts leaking oil and breaking apart at the head gaskets and stuff, requiring a complete engine overhaul. German vehicles however, are so rigorously engineered, they just need regular scheduled (and planned) maintenance, which may include an oil change, or in this case, employee attrition when subscriber numbers dwindle.
AT&T hasn't experienced a loss of customers since they inked the exclusive iPhone agreement, so they probably forgot what it's like to loose customers enmasse.
Wha?
Counterpoints
- The merger was designed to happen about a year and a half ago. If it had happened then, those 700,000 people would have been AT&T customers. As it turned out, how many of those 700,000 moved to AT&T?
"Loss of customers, commiserate [sic] with a reduction in headcount is smart business, reduces costs, and allows customers to get less-expensive cell phone service through better management, and making the difficult decisions."
- Surely you'd like to reword this sentence. It sounds like you're advocating a management strategy of loss of customers commensurate with a reduction in headcount. After T-Mobile got its 4.x billion dollar windfall as a result of the deal falling through, it still couldn't manage to avoid layoffs in the immediate aftermath. That doesn't reflect well on management.
"AT&T on the other hand, seems to outsource more, leading to inflated prices in relation to the value of the service they provide. Sprint was concerned about this. Before the AT&T/T-Mobile Announcement, Sprint called AT&T out for bilking its customers. "
- What? No! A direct competitor of AT&T portrayed AT&T in a negative light?!? And what exactly has led you to the impression that AT&T "seems to outsource more" ?
"Also, AT&T, and it's 110+ subsidiaries (see the FCC website for a complete list) is probably more difficult to manage headcount-to-subscriber ratio than AT&T does."
- utterly unintelligible.
"T-Mobile may be more transparent, but that's probably because they're run by Germany-based Deutsche Telekom, and have a German CEO, and as everybody knows, German engineering is typically the best on the planet."
- Ah, the old "everybody knows" premise. Can't very well argue with that rock solid logic. Now,exactly how does "German Engineering" (by which, I assume you mean "German Leadership") lead to transparency?
"It's like comparing Mercedes, or a BMW to a Ford Pinto. Once you hit 170,000 miles, the pinto starts leaking oil and breaking apart at the head gaskets and stuff, requiring a complete engine overhaul. German vehicles however, are so rigorously engineered, they just need regular scheduled (and planned) maintenance, which may include an oil change, or in this case, employee attrition when subscriber numbers dwindle."
- Yeah, let's compare high-end German sports cars to one of the cheapest models Ford has ever put out. That'll prove Germany's better. Unfortunately, not even the spirit of this argument holds true. Compare the total cost of ownership (purchase price, maintenance, parts, resale value) of similarly featured German and U.S. automobiles.
"AT&T hasn't experienced a loss of customers since they inked the exclusive iPhone agreement, so they probably forgot what it's like to loose customers enmasse."
- Last I checked, that exclusivity agreement expired over a year ago. Somebody forgot to tell AT&T's customers to evacuate.
Waiting for endorcement from Hot Air Balloonists...
I'm pretty happy with T-Mobile service. It works better than AT&T, I don't drop calls. At the same time, I don't care what service Hot Air Balloonists use anyway. But their endorsement gave me a chuckle.
Enjoy it while you can.
Maybe then AT&T can pick up the pieces
"the $39 proposed bid"
At least, say, 100 bucks?
;-p
AT&T Layoffs and Promises
Voice Stream which became T-Mobile is doing so poorly that it just gave away every phone in their inventory for zero dollars with a two year contract. Laying off 1900 people does not mean the end of the carrier.
For you who compared german engineering with the Mercedes and the Pinto get a grip. If a Pinto were designed and priced at 50 thousand dollars I chance to say it might last just as long as the Benz. Germans and engineering???? The only thing the Germans ever designed was a blimp that blew up and gas chambers to kill people. Oh yeah, and the Mercedes that shuttled Hitler around town.
AT&T Would Have Destroyed Far More Jobs
Had the AT&T T-Mobile merger gone through there would have been a decline in pre-paid competition also since T-Mobile had recently entered the pre-paid business and reports indicated they planned to expand in pre-paid services if the merger failed where T-Mobile has been more successful as of late than the post-paid contract market. The FCC and the Justice Department made the right call in denying Ma Bell a Ma Cell.
RE: AT&T Would have Destroyed Far More Jobs