WASHINGTON (AP) — Top executives from AT&T and T-Mobile USA will appear before a Senate panel Wednesday to try to convince lawmakers that their proposed $39 billion combination will benefit consumers and still leave plenty of competitors in the wireless industry.
Randall Stephenson, president and CEO of AT&T, and Philipp Humm, president and CEO of T-Mobile USA, are scheduled to testify Wednesday before the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights.
Although it will ultimately be up to the Justice Department and the Federal Communications Commission to approve or block the transaction, Congress will likely influence the outcome of the government review.
AT&T, the nation's second-largest wireless carrier, is seeking federal approval to acquire T-Mobile USA, the fourth-largest, from Germany's Deutsche Telekom AG. The cash-and-stock deal would catapult AT&T past Verizon Wireless to become the biggest cellphone company in the country.
AT&T argues that the purchase would lead to fewer dropped and blocked calls and faster mobile Internet connections for subscribers. They say the deal would allow the companies to combine their limited wireless spectrum holdings and make more efficient use of the critical airwaves needed to handle mobile apps, video and other bandwidth-hungry online services.
AT&T warns that it is running out of airwaves, particularly in dense metropolitan areas, as sophisticated new mobile devices like the Apple iPhone put enormous strain on its network.
AT&T has also said the purchase of T-Mobile would enable it to cover more than 97 percent of the U.S. population with its new high-speed, fourth-generation wireless service. Ensuring that all Americans, particularly those in rural areas, have access to affordable Internet access is a top priority of the FCC and the Obama administration.
The executives are likely to face skepticism not just from lawmakers, but also from their fellow witnesses. Also scheduled to testify are Daniel Hesse, chief executive of Sprint Nextel, and Victor "Hu" Meena, president and CEO of Cellular South.
Even as AT&T maintains that there would still be multiple wireless carriers — and plenty of competition — in most markets even after the deal goes through, Sprint and Cellular South have warned that allowing AT&T to buy T-Mobile USA would make it nearly impossible for smaller carriers to compete and turn the market into a duopoly.