Presidential Candidate Rick Perry Backs AT&T and T-Mobile Merger

September 1, 2011 -

Texas Republican Gov. Rick Perry sent a letter to the Federal Communications Commission in May endorsing the proposed merger between telecommunications companies T-Mobile and AT&T. On Wednesday the Justice Department went to court to block the merger. The National Journal reports that one of the leading Republican presidential candidates is backing the proposed AT&T - T-Mobile merger. In a letter dated May 25, Texas Governor and Republican presidential Candidate Rick Perry sent a letter to the Federal Communications Commission urging Chairman Julius Genachowski and the other commissioners to approve the AT&T and T-Mobile merger.

"I believe that this merger will continue to provide for great consumer choice, offer a wide range of service options, and spur continued innovation," Perry wrote. "The future rests in wireless broadband, and the federal government's swift approval of the merger between AT&T and T-Mobile would send a strong signal to employers, consumers, and states that our federal government is serious about meeting the communication and technology needs of Texans and all Americans."

Perry added that "the commitment of at least an additional $8 billion in private investment over seven years as a result of this merger" was a reason for his support.

This comes as no surprise considering that, according to the National Journal (citing the Texas Ethics Commission’s numbers on Perry); AT&T's political action committee has given the candidate $500,000 over the past decade.

Naturally Democrats are jumping on this news.

“This is just one more example of Rick Perry’s pay-to-play network that represents the same old type of lobbyist-first politics. He might try to pretend to be some outsider, but as his record continues to come to light, the American people will see right through his facade,” said Ty Matsdorf, spokesman for American Bridge 21st Century, a Democratic opposition research organization.

Mark Miner, a spokesperson for the candidate, defended the Governor's actions.

"AT&T is a highly regarded Texas-based company, creating thousands of good American jobs and providing critical communications services worldwide," Miner said in a statement to National Journal. "Gov. Perry believes the combination of the two telecom companies will be good for consumers, good for technology innovation, and good for American job creation."

Perry has been pro-business throughout his public service as a Texas Governor, particularly with the tech and entertainment industry, and is the only presidential candidate to ever deliver a keynote address at a major gaming event. He is at least well-respected by the ESA, who (no doubt) appreciate his state's incentives for the interactive entertainment industry.

Source: National Journal


Comments

Re: Presidential Candidate Rick Perry Backs AT&T and ...

Yeah, making the worst telcom in the country bigger will improve all our lives.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

He doesn't really believe any of that. He's only saying it because he knows the loudest republicans will back him no matter what. Now to the "anybody but Obama" crowd anyone who thinks badly of this merger is a filthy liberal-democrat-socailist-marxist-comunnist

Re: Presidential Candidate Rick Perry Backs AT&T and ...

The problem is, regulations = control and control = power. None of the players in the system (including the corporations) really want to give it up, no matter how much they give lip service to it. What they want is to have it on their side. They are more than happy to have their competitors tangled up in the morass as long as they can operate uninhibited (or even protected).

That is the dirty little secret that keeps our government pushing forward w/more and more regulation. Everybody loves it, as long as the crosshairs are painted squarely on a rival.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

"I believe that this merger will continue to provide for great consumer choice, offer a wide range of service options, and spur continued innovation," 

How? Specifically describe how this will drive innovation and better service. When has centralizing market power ever been good for the public? How is less competition and, therefore, less choice going to lead the existing providers to do more for their customers? Let me answer that with a factual response: Competition is what is needed, not consolidation. Competition will force the big bell corps to try to out-perform competitors with better service. Centralizing it will just give the biggest players the power to block others from participating, giving AT&T the ability to be complacent and sit on its laurels. We broke up AT&T when they got too big and became a detriment to the public once already. Didn't you learn anything from that?

"The future rests in wireless broadband, and the federal government's swift approval of the merger between AT&T and T-Mobile would send a strong signal to employers, consumers, and states that our federal government is serious about meeting the communication and technology needs of Texans and all Americans."

No, it would send a strong signal that you don't have to serve the public good by trying harder, if you can get a monopoly. To get technology companies to make a real effort to expand technology and communications, you need more companies out there looking to prove they can provide what we need rather than what merely serves themselves. Innovation is best driven by competing companies playing catch-up with each other, trying to do one better than the other guys. What the merger does is the opposite. It takes away the incentive to do better and lets them focus only on what's best for the company.

-Greevar

"Paste superficially profound, but utterly meaningless quotation here."

Re: Presidential Candidate Rick Perry Backs AT&T and ...

Speaking as a native Texan I apologize for the big friggin' six-pack of crazy that Rick Perry is. I think it would be much better for the human species as a whole if we did not allow him or his children to procreate.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

You shouldn't need to apologize. The one who should is the one who never will, Ricky himself.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

Honestly, this merger wouldn't be a problem if there weren't so many pointless regulations on a national, state and federal level to expansion of cell networks. If AT&T could build when they needed and where they needed with nothing more than permission from the land owner and a guarantee that the towers wouldn't interfere with emergency services and flight paths, they would be able to expand without needing to buy another company.

Also, if it were easier to new companies to enter the market there would be more competition. As it stands now, you have to be huge to lease bandwidth from the FCC. Smaller companies then have to lease from these huge mega corps. If it were possible for smaller companies to get the bandwidth they need, they would be able to compete easier and there would be fewer mega corps.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

I actually wonder how many of those regulations were actually put together by cell phone companies... they are worth a great deal of political captial.. the cell phone companies can complain about them when they want, use them against startups or local governments when they want, and ignore them when they make a deal with state governments.  They have been wonderful for keeping out competition yet seem to never really apply to whichever carrier is dominant in a region.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

You are talking about regulatory capture. Yes, many regulations and licensing programs passed by the government are there to benefit well connected businesses to the detriment of competition.

For example, There is a law suit in Louisiana between a monastery and the government about the ability for the monks to make caskets. According to LA law, only licensed funeral homes can sell caskets. To become a license funeral home, the monks would have to send someone to school for a couple of years, have them become an apprentice at a licensed funeral home for a few more years, perform a couple dozen embalmings all to just sell caskets. The monks have no interest in becoming a funeral home. They just want to sell caskets. But because a few well connected funeral homes were able to get licensing laws passed, they have a choke hold on the casket market.

Same thing here. If you look at Guatemala, they deregulated the phone industry and it is now booming. Phone service is cheaper and more prevalent there that it is in any regulated nation. Yet, somehow people seem to think more regulation makes us better. They are wrong. More regulation means the barrier to entry into a market is raised only letting the largest of businesses enter.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

Well, I think you need to get just the right regulations in place, which can be tricky.

I am not familiar with the Guatemala case.. but generally what happens after deregulation is you get a spurt of competition, then a few big companies become so powerful that they start acting as quasi-state entities.   You can see the effect in our own history.. a deregulated phone system was originally booming, but over time competition decreased as a few monster telecoms took over and were able to lock people down... it took regulation to get the prices (esp cross network) down and force investment in rural areas (game theory issue... everyone stands to profit, but each individual carrier does not want to invest since everyone gains but only they get the cost.. thus no one pulls the trigger).

I would wager in Guatemala's case they still at least have an equivalent of the FCC to keep people playing fair with spectrum... and looking at their case study now, they actually are having some of the same problems the US did, good coverage in the cities, no provider willing to invest in the rural areas.

This actually gets into one of the classic problem with when US analysts look at other countries, we tend to use cities as the primary metric for how well a place is doing... possibly because we are city oriented, possibly because it tends to concentrate wealth and is easier to tour/photograph... and it looks like that is the problem with the Guatemala analysis... it has done great things for the cities but not much for the rest of the country.  It is also TINY in comparison to the US... the larger you have to think the more regulation you generally need... smaller scale requires much less big picture planning.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

You make some very good points.

However, I will point out, in the US the failure of regulation is almost always met with a response of more regulation. Very few people in power ever suspect that it is the existence of regulation that is the problem.

Let's look at another case, the drug war. The US has a massive problem with drugs. We have waged a war on drugs for 50+ years. What has that gotten us? Larger and more powerful drug cartels, murders of thousands of people in the US and Mexico. So what do we do to fight back? We start locking up drug users. People whose only crime was getting high.

One would think that the US would learn from the past and look at what happened during prohibition and how things changed for the better after ending prohibition. Sadly we haven't learned and instead are looking for greater enforcement rather than the more logical alternative of legalization.

This happens in business. We look at this AT&T T-Mobile merger and rant and rave about how it limits competition and raises prices, but we don't realize that this merger is a symptom of a far larger problem, that of too much regulation keeping new companies from springing up and growing.

Same thing in health care. We rant and rave about the high cost of medicine in the US. Then we go and punish Google to the tun of $500 million for connecting sick Americans with cheap medicine from Canada. This doesn't lower the cost of medical care. These actions raise the cost forcing more sick Americans to go bankrupt and/or die.

Policy making seems to be a one way street and that street is headed towards more and more regulation. We don't need to adjust our speed, we need a full stop and a reverse of course.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

So, fewer competitors = more choice, more options, and and more innovation?  Wow.  Thank god (intentional irony) this guy will never actually win the presidency.

Re: Presidential Candidate Rick Perry Backs AT&T and ...

Well, This IS what Republicans in general actually believe.

 
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