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]