Update 8:08 a.m. PT: Just after this story was posted, the Department of Justice said that it has gone to court in Washington, D.C., in an effort to block the merger of AT&T and T-Mobile, saying the deal would reduce competition and violate U.S. antitrust laws.
AT&T is using the prospect of more jobs to help make a stronger case for its merger with T-Mobile USA.
If the deal is approved, AT&T today said that it will be able to "bring back" 5,000 call center jobs to the United States that are currently outsourced to other countries. In addition, the company said that it doesn't anticipate any job losses for U.S.-based call center workers after the merger closes.
"At a time when many Americans are struggling and our economy faces significant challenges, we're pleased that the T-Mobile merger allows us to bring 5,000 jobs back to the United States and significantly increase our investment here," AT&T CEO Randall Stephenson said in a statement. "This merger and today's commitment are good for our employees, our customers, and our country."
AT&T announced its plans to acquire T-Mobile USA from Deutsche Telekom earlier this year. If the deal is approved by both the Federal Communications Commission and the U.S. Department of Justice, AT&T will pay $39 billion to merge with T-Mobile USA. If that happens, the combined company will dwarf all other competitors with about 130 million subscribers around the U.S.
Debate rages over whether or not AT&T should be allowed to acquire T-Mobile USA. Those who stand against the deal say that the merger would stifle innovation in the mobile market and drastically reduce competition, thus hurting consumers.
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"[The merger] will likely tend to substantially lessen competition, lead to consumers paying high prices with fewer choices, as well as lessen the innovation that has been the keystone of this industry in the last decade," Sen. Herb Kohl (D-Wis.), one of the more outspoken critics of the deal, wrote to the U.S. Department of Justice and FCC last month.
Sprint, which in particular would be dwarfed by the combined AT&T and T-Mobile USA if the deal is approved, has also expressed concern about it. The company's CEO Dan Hesse said during a speech at the Commonwealth Club in San Francisco in April that the deal must not be allowed to happen.
"Competition will be stifled, growth will be stifled, and wireless innovation will be jeopardized," he said during his speech. "We just can't let this happen."
But not everyone is so concerned. In June, AT&T announced that a host of prominent organizations, including the AFL-CIO and the NAACP, are in favor of the deal.
"These groups and elected officials understand the extraordinary benefits of bringing high-speed wireless broadband to more than 97 percent of the U.S. population, or an additional 55 million more people," AT&T said in a statement at the time, touting its support. "From the most populated areas to large stretches of rural America, consumers will have access to new and innovative technologies and will benefit from increased network capacity and improved service."
Some lawmakers are also coming out in force to support the deal. Earlier this month, Rep. Lamar Smith (R-Texas) said that the proposed merger could greatly benefit consumers by helping to spur innovation, as well as create new jobs. At the time, 26 governors, 92 mayors, and 11 state attorneys general had also announced their support for the deal.
In a statement today on AT&T's announcement of 5,000 new jobs, AFL-CIO president Richard Trumka touted the move, saying that it's what's needed in today's struggling economy.
"These jobs will provide quality wages and benefits and good working conditions for U.S. workers--exactly what's needed to help turn around our struggling economy," Trumka said. "Instead of sitting on more than $2 trillion in assets and sending jobs overseas while millions of Americans are out of work, working people are looking for U.S. employers to follow AT&T's lead. If more employers took this kind of action, we could begin to move our economy forward and strengthen the middle class."
The Communications Workers of America, a union partly made up of employees in the wireless business, including 160,000 AT&T workers, also responded favorably to the announcement, saying that AT&T's decision to "bring back quality jobs" is "big news."
The final decision on the proposed merger is expected to be made by the FCC and DOJ early next year.