Crumpton

NAACP national board member and former Missouri Public Service Commission member Harold Crumpton believes that combining AT&T and T-Mobile will create 100,000 new jobs, despite the fact both companies have promoted “cost savings” from eliminating redundant services and winning “increased efficiencies.”

That’s code language for layoffs, and it has been that way with every telecommunications merger in the last decade.  But Crumpton prefers to deny reality in a guest opinion piece published today in the St. Louis Post-Dispatch:

Most mergers result in — and pay for themselves with — job losses and higher prices. Not this one.

If, to use the government antitrust lingo, there is a “relevant product market” for this merger, it would be “jobs” because jobs are the No. 1 product of the broadband factory. The AT&T and T-Mobile merger is structured as an engine of job creation — yielding 100,000 new jobs by delivering on President Obama’s call for a national high-speed broadband network. That’s far more jobs than would be lost because of AT&T and T-Mobile overlaps.

Ironically, AT&T announced the repatriation of 5,000 call center jobs and pledged not to terminate call center employees because of the merger. Two hours later, without warning to AT&T, the Justice Department filed its suit. Suffice to say that President Obama, our greatest champion of job creation, was not well-served that morning.

How will AT&T produce all these new jobs? By creating the first national next-generation high-speed (4G) mobile network. The merger is what will make the network possible, and it will do that by aggregating and redeploying spectrum T-Mobile can’t use for 4G. In this way, the network would reach 55 million more Americans than 4G currently reaches.

AT&T couldn’t have argued the case better.  Oh wait.  They have, in the company’s advocacy package mailed to the NAACP and dozens of other groups who receive the company’s financial support.  Those talking points inevitably end up in the guest editorials penned by Crumpton and others.

While the bloom is clearly off the rose of the AT&T/T-Mobile merger, thanks in part to consumer groups and the U.S. Department of Justice who filed a lawsuit to stop it, AT&T is still flailing about trying to find some way to get the deal done, if only to avoid the outrageous break-up fee self-imposed by the telecommunications giant if the deal falls apart.  AT&T’s promise to bring an end to the obnoxious practice of offshoring their customer support call centers — if the merger gets approved — has been compared with blackmail by some customers who have spent an hour or more negotiating with heavily accented customer support agents that companies like Discover Card routinely mock.

AT&T promises customers a solution to the "Peggy Problem" if their merger with T-Mobile gets approved.

It clearly wasn’t enough to move critics of the deal to reconsider — AT&T could voluntarily hire American workers who speak the language of their customers for the benefit of those customers with or without a merger with the fourth largest wireless carrier in the country.

Crumpton argues President Obama was not well served by the Justice Department.  Consumer groups argue T-Mobile and AT&T’s customers will not be well-served if this merger ever happens.

As Stop the Cap! has repeatedly argued, both AT&T and T-Mobile will construct 4G mobile broadband networks in all of the places where the economics to deploy those networks makes sense.  No more, no less, no matter if AT&T and T-Mobile are two companies or one.

Crumpton might as well have argued the merger would deliver 4G service to Sprint customers as well.  It’s the same disconnected logic.

Crumpton thinks AT&T’s high-priced, heavily-capped 4G network will somehow solve the pervasive problem of the digital divide — the millions of poor Americans who can’t afford AT&T’s prices.  Incredibly, Crumpton’s answer is to allow one of the most price-aggressive, innovative carriers in the country favored by many budget-conscious consumers to be snapped up by the lowest rated, if not most-hated wireless company in the country.

It just doesn’t make sense.  But it does make dollars… for the NAACP, which receives boatloads of corporate money from AT&T.  It’s no surprise the pretzel-twisted logic that drives merger advocates like Mr. Crumpton comes fact-free.  The money makes up for all that.

“The NAACP stands ready to work with the public and private sectors to ensure that every American has an equal opportunity to participate in and benefit from this awesome ‘broadband revolution,'” Crumpton writes.

We can only hope that is true.  The NAACP can get started by admitting publicly it receives substantial support from AT&T and it will either agree to remain neutral in corporate advocacy issues to avoid conflicts of interest, or return AT&T’s money.  After all, it sounds like they need it to build the digital divide-erasing 4G network Crumpton is purportedly so concerned about.

Cicconi

Jim Cicconi, AT&T’s chief lobbyist told Politico the company’s practice of encouraging civil rights and charity groups to advocate on its behalf was “entirely natural,” and claimed opponents of the proposed merger of AT&T and T-Mobile were doing the same thing.

“The difference is that we seem to be having success and they are not. We attribute that entirely to the obvious benefits of the merger and the history of what we have stood for as a company,” Cicconi said. “What seems unnecessary is for opponents to attack the motives and credibility of those who have chosen to support our position and not theirs.”

AT&T has made substantial contributions, both financial and through involvement by key AT&T executives on various boards of directors of non-profit groups, as part of its corporate strategy.  Often, many of the non-profit groups involved thank AT&T by submitting letters of support for various business activities AT&T is engaged in, including public policy debates, mergers and acquisitions, and legislation that could impact the company’s bottom line.

On occasion, the connection between AT&T’s large financial contributions and the advocacy letters that often result becomes a point of contention with rank and file members of the organization, as happened in June with a gay rights organization that culminated in the resignation of its president and an AT&T-connected board member.

But more often than not, the corporate money-and-influence-connection goes unnoticed by the constituents of these organizations, many of whom will be disadvantaged, charge critics, by an outcome favorable to AT&T.

Politico explored the links between AT&T executives, lobbyists, money and civic groups and charities and discovered plenty:

Somehow, letters from the National Urban League and...

• Norelie Garcia, associate vice president of federal affairs at AT&T, who is an executive committee chair on the National Puerto Rican Coalition’s board of directors. The group wrote to the FCC May 27.

• Jerry Fuentes, president of AT&T for the Arizona and New Mexico regions, is the vice president for corporate policy on the National Hispanic Caucus of State Legislators’s business board of advisers. The organization wrote to the FCC backing AT&T on May 26.

• Barbara Winn, AT&T’s Sacramento-area director of external affairs, is listed on the letterhead of the Greater Sacramento Urban League as executive committee chairman in the filing the group sent to the FCC supporting the deal June 17.

• Tanya Lombard, assistant vice president of public affairs at AT&T, is a board member of the National Coalition on Black Civic Participation. The group wrote to the FCC May 25, saying “We believe it will help fulfill President Obama’s vision of an America in which everyone has affordable access to high-speed Internet service.”

AT&T is listed as a sponsor of the Cuban American National Council , the National Puerto Rican Coalition, and among the National Coalition on Black Civic Participation’s 35th anniversary partners. Meanwhile, it costs $25,000 annually to be a full member of the National Hispanic Caucus of State Legislators’s business board of advisers, as AT&T’s Fuentes is.

In 2009, the AT&T Foundation gave the local chapters of the Urban League in Chattanooga, Tenn.; Columbia, S.C.; and Knoxville, Tenn., a total of $45,000.

The National Urban League in 2009 received more funding — $100,000 — from the Sprint Foundation. But Sprint, which has been the most vocal corporate opponent of the AT&T/T-Mobile deal, does not have executives on the boards of any of those groups, the company said.

...the National Action Network turned out to be nearly identical.

Politico found many of America’s most influential civic rights groups received private briefings from AT&T executives promoting the deal — meetings which ultimately led to letters of support from those organizations, despite their having little or no input from those opposed to the merger.  AT&T also has dispatched “advocacy kits” to many groups filled with sample letters and talking points the company encourages groups to use as a template for letters of their own.  Not counting on the laziness among many tasked with writing the letters ultimately dispatched to the Federal Communications Commission, there is often a striking resemblance of correspondence favoring the merger.

Politico notes the text in two filings submitted last month to the FCC by the National Urban League and Al Sharpton’s National Action Network regarding the acquisition are nearly identical.

All of this disturbs ColorofChange, a civil rights group not on the payroll of either those supporting the merger or opposed to it.

“There are long-standing relationships AT&T has with these organizations that we think unfortunately have led some of them to take AT&T’s position on an issue that will negatively impact black people,” Rashad Robinson, executive director of ColorofChange told Politico.

AT&T just disclosed its latest lobbying reports, showing the company has increased its lobbying budget by nearly $1,000,000 compared with the same quarter last year — spending $6.84 million during the first quarter of 2011 alone on lobbying the federal government.

Sprint Nextel, seen by many as the primary opponent of the deal, actually reduced its own lobbying expenses during the same period, spending just $583,000 during the first quarter, down 25% from the $774,100 spent a year earlier.