How AT&T Screwed Up the T-Mobile Merger

By now, the AT&T-Mobile merger is on its last legs. AT&T has pulled its formal application to the FCC so it can focus on the doodiestorm that the Department of Justice is bringing down on its head. The Washington Post shows us how it all went so wrong.

After the T-Mobile deal was first announced, AT&T ran out its typical phalanx of lobbyists, politicians it had made campaign contributions to, and interest groups that it funds to bumrush Capitol Hill. And because T-Mobile was sure to be such a controversial acquisition—the biggest such merger in years, actually—AT&T ran a full court press, throwing everything it had at getting the deal through. And it totally backfired:

The letters from third-party groups raised eyebrows at government agencies and on the Hill, where people began wondering why groups with no obvious ties to broadband were writing in. News reports emerged showing that many of the groups had financial ties to AT&T.

Then there were the ads that staff members at the FCC said they couldn't avoid when they opened a newspaper, fired up their iPads or watched TV - all touting the merger's ability to put thousands of Americans to work. But who had ever heard of a big company merger creating rather than destroying jobs?

So AT&T thought everyone on the Hill was an idiot. Not really news, since AT&T think's everyone's an idiot. But its hubris really shines through in the ham-fisted way it handled the DOJ and FCC:

Incredulous staff members at the FCC also sent a harshly worded letter in the fall saying the company had "produced almost nothing" to prove its job claims. Their skepticism grew when an AT&T lawyer accidentally uploaded internal documents to the agency's Web site that showed the company was planning to expand its broadband network even if the merger didn't go through.

Sure, the merger was probably anti-competitive and a total reach under most interpretations of antitrust law, but what really sunk AT&T was its bizarre assumption that it was no big deal to tell seemingly boldfaced lies to investigators and the public without making enough effort to prove otherwise. You know, business as usual. [Washington Post]