AT&T/T-Mobile merger flopped despite governor, advocacy support

Despite galvanizing governors and special interest groups, AT&T has given up on owning T-Mobile and its tantalizing prize of broadband spectrum--nine months after shocking the U.S. with news of the proposed buyout.

AT&T, T-Mobile's broken merger

From the outset, it appeared that AT&T had all the political elbow grease it needed to complete its ultimately failed takeover of rival carrier T-Mobile.

Yet pressure from Sprint, the Department of Justice (DOJ), antitrust interests, and finally the Federal Communications Commission (FCC) had AT&T fighting to revise the terms of its buyout proposal. Today, after a nine-month drama of diminishing opportunities to pass the merger, AT&T finally threw in the towel.

Although the deal may have been doomed for some time, early signs pointed to AT&T pocketing T-Mobile's assets. It had the cash ($39 billion, to be precise), the support of T-Mobile parent company Deutsche Telekom, and good friends in the form of lawmakers and policy advocates of all levels.

Here's an overview of some of the most notable supporters (and detractors) of AT&T's acquisition with T-Mobile.

As of June, 76 of approximately 200 democrats in the House of Representatives supported AT&T's annexation of T-Mobile for the sake of hurrying along the carrier's widespread deployment of 4G LTE.

Sprint CEO Dan Hesse was a fervent and vocal agitator against the AT&T and T-Mobile merger. Kent German/CNET

A group of 15 House democrats even went as far as drafting a letter asking President Obama to intercede with the Justice Department on AT&T's behalf.

Back in August, House Representative Lamar Smith (R-Texas) spoke out against anti-merger arguments that told "only one side of the story." Creating jobs and encouraging innovation among a smaller cast of wireless competitors were two benefits Smith cited.

Meanwhile, Sen. Herb Kohl (D-Wis.), leader of the Senate Judiciary Antitrust Subcommittee, spoke out against the merger on the grounds that it would stifle competition. Other lawmakers--like Reps. John Conyers (D-Mich.), Anna Eshoo (D-Calif.), and Ed Markey (D-Mass.)--went on record to question a "troubling backward step" that could lead to "a duopoly in the wireless marketplace."

State governors
27 state governors went on record to support the merger, ranging from Arizona to West Virginia. All wrote letters to the FCC from May to August, 2011 spelling out how consolidating the No. 2 and No. 4 U.S. wireless carriers would benefit their constituents. Most justifications echoed AT&T's own--chiefly fewer dropped calls and expanded network coverage, especially to rural or more tucked-away communities. Again, speedier LTE deployment across the U.S. was another cited perk. (See the chart at the end for the complete list of governors in favor of the merger.)

Attorneys general
The attorneys general of 11 states submitted a joint letter to the FCC on July 27 to cast their lot with AT&T: Arkansas, Alabama, Georgia, Kentucky, Michigan, Mississippi, North Dakota, South Dakota, Utah, West Virginia, and Wyoming.

Although support was strong in AT&T's favor, as in all levels of politics, there was also a strong current of dissent. In March, New York Attorney General Eric Schneiderman revealed his intentions to review AT&T's proposal with an eye on competition. More recently, on September 16, the attorneys general of California, Illinois, Massachusetts, New York, Ohio, Pennsylvania, and Washington submitted their opposition to the FCC.

These advocacy groups supported AT&T's T-Mobile buyout.
LULAC, GLADD, and the NAACP supported AT&T's T-Mobile buyout. Composition by Jessica Dolcourt/CNET

Advocacy groups
A diverse group of advocacy organizations also took AT&T's side. The Communication Workers of America, a union of telecommunications workers, estimated that buying up T-Mobile would generate 100,000 new jobs. (AT&T estimated that it could create 5,000.) Other groups included the NAACP, GLADD, and the Sierra Club.

Governors in favor

Action taken?Who sent it?Date
AlabamaLetter to FCC (All letters are in PDF format)Gov. Robert Bentley (R)June 14
ArizonaLetter to FCCGov. Jan Brewer (R)June 20
ArkansasLetter to FCCGov. Mike Beebe (D)May 23
ColoradoLetter to FCCGov. John Hickenlooper (D)May 27
ConnecticutLetter to FCCGov. Dannel P. Malloy (D)June 10
DelawareLetter to FCCGov. Jack Markell (D)June 8
FloridaLetter to FCCGov. Rick Scott (R)June 22
GeorgiaLetter to FCCGov. Nathan Deal (R)May 17
IdahoLetter to FCCGov. C.L. Otter (R)May 17
IowaLetter to FCCGov. Terry Branstad (R)May 26
KentuckyLetter to FCCGov. Steve Beshear (D)May 26
LouisianaLetter to FCCGov. Bobby Jindal (R)May 19
MaineLetter to FCCGov. Paul LePage (R)May 19
MarylandLetter to FCCGov. Martin O'Malley (D)June 20
MichiganLetter to FCCGov. Rick Snyder (R)May 19
MissouriLetter to FCCGov. Jay Nixon (D)August 12
NevadaLetter to FCCGov. Brian Sandoval (R)May 27
North CarolinaLetter to FCCGov. Beverly Perdue (D)May 31
North DakotaLetter to FCCGov. Jack Dalrymple (R)July 1
OhioLetter to FCCGov. John Kasich (R)June 9
OklahomaLetter to FCCGov. Mary Fallin (R)May 16
South CarolinaLetter to FCCGov. Nikki Haley (R)May 21
South DakotaLetter to FCCGov. Dennis Daugaard (R)June 20
TennesseeLetter to FCCGov. Bill Haslam (R)May 27
TexasLetter to FCCGov. Rick Perry (R)May 25
VermontLetter to FCCGov. Peter Shumlin (D)June 20
West VirginiaLetter to FCCGov. Earl Ray Tomblin (D)June 21
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