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Would Perry-Backed Wireless Merger be a Texas Jobs Killer?

August 22, 2011

RIO GRANDE VALLEY, Texas - Experts may differ over the exact number, but if Dallas-based AT&T is allowed to swallow up T-Mobile and become the largest cell phone service provider in the country, tens of thousands of jobs are likely to be eliminated. Low-level T-Mobile workers are expected to take the biggest hit - such as those in retail and customer-service capacities that would be duplicated by a merger. The company has three call centers in Texas.

As the country struggles to avoid a double-dip recession, Chance Williams, government and external affairs manager with the media watchdog group, says approving the takeover makes no sense.

"I think it's 100 percent clear that this merger is a job-killer. This is a massive horizontal merger, and that's the kind that always costs jobs."

The Justice Department and Federal Communications Commission are currently weighing the $39 billion takeover. Williams says in light of today's stubborn unemployment - and poverty at a 15-year high - the deal should be blocked. He fears it will also lead to increased wireless rates on consumers.

AT&T has said the merger will eventually create jobs because it will expand broadband service. Amalia Deloney of the Center for Media Justice disagrees, predicting minority workers will especially feel the impact.

"We're looking at the number of people who are employed currently at T-Mobile across the country. Forty-eight percent are employees of color. If the merger went through, as many as 20,000 people would potentially receive pink slips."

In a letter to the FCC supporting the merger, Gov. Rick Perry praised the "light regulatory touch" that has kept the wireless marketplace competitive. Critics say there's a simpler reason the governor is willing to risk so many Texas jobs: AT&T has given Perry $692,000 in campaign contributions since 2002.

Two of the Texas T-Mobile call centers are in the Rio Grande Valley, where Latinos make up about 90 percent of the population and unemployment is hovering around 13 percent. Nearly half of Valley residents have no health insurance, according to South Texas activist Ron Rodgers, a member of the Rio Grande Valley Equal Voice Network. He says call-center employment has been essential to the region in recent years.

"Historically, call centers come to the Valley. We have a lot of them. They need folks who are bilingual. If the merger happens, it'll hurt. They don't cut at the top, they cut at the bottom. Rio Grande Valley is at the bottom."

Peter Malof, Public News Service - TX