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Critics: Fewer Jobs a "Wrong Number" for AT&T, T-Mobile Merger

August 25, 2011

BELLEVUE, Wash. - Experts may differ over the exact number, but if AT&T is allowed to swallow up Bellevue-based T-Mobile and become the nation's largest cell-phone service provider, some 20,000 jobs are likely to be eliminated. Most of those would be held by T-Mobile workers.

As the nation struggles to avoid a double-dip recession, says Chance Williams, government and external-affairs manager of the media watchdog group FreePress.net, approving the takeover doesn't make 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."

T-Mobile is telling customers the merger would provide "even stronger service," and AT&T predicts it will create jobs. A poll just released shows the percentage of telecommunications experts who expect the government to approve the merger has dropped from 54 percent last month to 49 percent. The poll of 32 expert observers was conducted by Stifel Nicolaus & Co. of Washington, D.C.

T-Mobile's traditionally lower-cost plans have made it a popular choice among low-income families and communities of color, says Amalia Deloney, grassroots policy director for the Center for Media Justice. She adds that merger-related job losses will hit hard there, too.

"We're looking at the number of people who are employed currently at T-Mobile, 48 percent of which we know of their employees are employees of color; and then the fact that, if the merger went through, as many as 20,000 people would potentially receive pink slips."

Some high-profile groups, including the National Black Chamber of Commerce, support the merger. However, Williams sees few reasons to OK the merger and many to disallow it.

"You've got unemployment on the rise and the poverty rate at a 15-year high. There's absolutely no reason to approve a deal that's anti-competitive, that's going to cost jobs and, in the end, raise consumer prices."

The proposed merger is being considered by the Justice Department and Federal Communications Commission. Both phone companies are telling customers the process will take a year.

Chris Thomas, Public News Service - WA