Sprint: AT&T, T-Mobile deal could kill jobs

This isn’t much of a surprise given how adamantly Sprint has opposed the AT&T, T-Mobile merger but a new Sprint-commissioned study said that the potential mega-merger could lead to jobs losses.

AT&T is saying that the merger could lead to up to 5,000 new jobs in the United States but the study, done by Professor of Economics and Director of the Center for Economics & Public
Policy at UC Irvine, said this is likely not the case. One of the executive summary bullet points said:

The merger may or may not have other benefits that have to be weighed against its potential costs. But there is no basis for claiming that job creation is one of these benefits, and the direct effect of the merger is far more likely to be many thousands of lost jobs.

I don’t teach economics but even I know that a merger of this size would lead to some redundancies and some job cuts. This part may not even matter that much, as the Department of Justice recently sued to block the deal on antitrust grounds.

AT&T isn’t giving up yet though, as the deal is not fully dead. There’s still a chance that it could negotiate with the DOJ and the Federal Communications Commission to work out some divestitures and other requirements to make the acquisition go through. It will also be facing a multi-billion dollar breakup fee if the buy doesn’t work, so you can be sure it will be working over legislatures.

[Via Sprint, hat tip to TechCrunch]

About The Author

Marin Perez

Marin Perez has torture tested cell phones and smartphones for industry leaders like CNET and InformationWeek. He remembers when 4G was just a screen on PowerPoint presentations and is fascinated with the amount of innovation out there. Marin has spent a lot of time with BlackBerry and Android but he finally broke down a bought an iPhone to see what all the hype's about. He also has too many tablets.

Anonymous

I applaud Sprint and Mr. Dan Hesse for there stance on this matter tmobile deserves to remain tmobile and there customers shouldn’t have to be forced to become At&t simple as that.
http://twitter.com/WillieFDiazSF William Diaz ?

Where I live in San Francisco, Ive seen some T-Mobile stores on Market Street DIRECTLY across the street from AT&T stores. In malls, there are kiosks and even full stores in other places of the city that are directly next to or across AT&T stores as well. How can AT&T say “We will bring 5000 new jobs” is beyond me. Sure there will be 5000 NEW jobs, and 10,000+ old jobs gone away, that leaves a net NEGATIVE 5000 jobs from this merger. Different talent will move into different divisions of the company where needed. Leaving most of the sales, retail stores, call centers, and telesales out in the dust. Not to mention they are gonna kill off the non-union employees first as there is less backlash than there is killing off the CWA union emps.

You know it, I know it, AT&T knows it and T-Mobile knows it – this is a bad deal that only benefits AT&T and not even AT&T’s customers are gonna benefit from any part of this merger, except that they will get to still flaunt in T-Mobile customers faces that sure while they pay more, they still have the iPhone and still have a bigger covered 3G network. Of course NONE of that means anything to me, since I know for a fact based on experience that not only is T-Mobile a better EDGE network, but a better 3G UMTS/HSPA AND 4G HSPA+ network that works in more areas than any of AT&T.
Omgabear

When exactly did people forget how to read? The press release clearly states at&t said they’ll bring 5,000 call center jobs that are currently outsourced overseas back to the US. They never said they’d create 5,000 new jobs. Of course there will be redundancies in stores and other positions but it seems obvious to me and most people with half a brain that they’ll be doing this to compensate for that. I expect this from the angry masses but not Intomobile. The fact that Sprint commissioned a study on it is just sad or laughable, I can’t decide which.
Anonymous

But they have money, so rest assured that all the right pockets will be “lubed” to make it all happen.

privacy-online.tk
http://www.facebook.com/posix.1c Jamey Hopkins

What people don’t realize is that T-Mobile is most likely for sale. The parent company has expressed an interest in getting out of the US market. If AT&T doesn’t get it, then Sprint is a likely buyer. So, of course Sprint wants to make a sale to AT&T look bad. Then there is Google, which could always step in and make the purchase too.