Feature Article

March 12, 2013

FCC Pushes to Approve T-Mobile, MetroPCS Deal without Holding a Vote

It appears that the U.S. Federal Communications Commission (FCC) is looking to approve a proposed merger with T-Mobile USA and MetroPCS Communications, Inc. Now this may sound normal, but the fact of the matter is that the FCC wants to do this without a vote.

This, of course, does not sit well with the Communications Workers of America union. Their attorney, Monica Desai said that the FCC may be considering an order to approve the deal “at the bureau level instead of the commission level.” Neil Grace, an agency spokesman, declined to comment today.

The Stifel Financial Corporation was formed as a financial services holding company in July 1983. They offer securities related financial services in the U.S. and Europe. David Kaut, a Washington based analyst said, “I assume it’s good for the deal’s prospects and shows the merger is basically non-controversial aside from the union’s concerns about employment. No one thinks this is going to be blocked.”

In an interview, Debbie Goldman, who is the telecommunications policy director for the Washington based labor union, said “This is outrageous. It’s unprecedented that a deal that is this big and has raised controversies about its employment impacts would not be voted on by the full commission.”

According to a union newsletter, without conditions, the prospects for T-Mobile workers look grim. T-Mobile and MetroPCS claim the merger will result in $1 billion in cost reductions. This will be in both customer support and back office operations. These are euphemisms for job loss and outsourcing.

The reason for the union’s filing, which was submitted on March 4, 2013, is to make the FCC impose requirements aimed at preserving jobs after the companies combine. The union estimates that the merger will eliminate a significant number of jobs.

T-Mobile says that it plans to keep hiring for its call centers which would increase the number of overall U.S. positions. T-Mobile did not give any specific information simply that it plans to continue hiring. It also plans to keep the two brands as separate lines of business and maintain two networks of retail stores and dealer franchises.

The hope for this deal is to reinvigorate T-Mobile. Currently, it is the fourth largest U.S. wireless carrier. With MetroPSC being the fifth largest, the goal of combining the two companies is to challenge the market power that is now being brandished by AT&T and Verizon.

 Everyone seems to feel that the merger will win approval. The union’s concerns are that the merger will cost jobs. The struggle continues, but will the FCC approve, without a vote, what Desai says is the largest transaction creating a company with an estimated workforce of 38,000?




Edited by Brooke Neuman


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