AT&T is heating up its retaliatory campaign against the Federal Communication Commission for denying its $39 billion acquisition of T-Mobile. Speaking at conference, AT&T CEO Randall Stephenson claimed once again that the merger’s death directly resulted in AT&T raising mobile data prices 30 percent earlier this year, The Hill reported.
Stephenson chose an apt pulpit. He delivered his speech before the Milken Institute, founded and named after junk-bond trader Michael Milken, who was convicted of felony securities violations in 1990 and sentenced to 10 years in the federal pen. Neither Milken, nor Stephenson, have any great love for regulators.
We’ve heard Stephenson’s refrain before. Stephenson tried to make the same case to analysts and investors in fourth quarter earnings call, claiming that the FCC was picking winners and losers in the mobile industry. Without T-Mobile’s 4G airwaves, AT&T doesn’t have enough capacity to meet the enormous mobile data deluge generated by millions of new smartphones, which in turn is forcing AT&T to raise data prices – or so Stephenson’s argument goes.
The truth is no one forced AT&T to raise prices. AT&T just raised prices because it wanted to. It’s just scapegoating the FCC, whether to make some petty point or to deflect attention away from a good-old fashioned money grab. AT&T had, and still has, plenty of head room to grow its network capacity. Let’s break down why:
This isn’t the last we’ve heard from Stephenson on the issue. Much of AT&T’s public communications since the merger’s failure have been direct or indirect assaults on regulators. Ma Bell even used the Super Bowl as an excuse to decry its so-called capacity problems. And as long as AT&T keeps making these claims, we’ll continue to dispute them.
Related research and analysis from GigaOM Pro:
Subscriber content. Sign up for a free trial.