FCC Cancels October Meeting on Proposed Merger

The FCC on Friday afternoon canceled its meeting to discuss, and most likely vote on, the pending AT&T Inc.-BellSouth Corp. merger.

An FCC spokesman said only that Democratic Commissioners Michael J. Copps and Jonathan S. Adelstein had requested reviews of the mergers requirements, with Chairman Kevin J. Martin responding in a letter and postponing the agencys consideration of the $80 billion deal.

Martin wrote that he plans to take up the matter again at the FCCs Nov. 3 meeting and asked Copps and Adelstein to raise their concerns sooner, rather than later, to avoid any further delay in our consideration of this transaction.

Copps and Adelstein want some conditions imposed on the transaction, which would make AT&T the largest phone company in the United States. Public comments are due by Oct. 24.

Unlike the megamergers earlier this year between AT&T Inc. and SBC Communications Inc. and Verizon Communications Inc. and MCI Inc., the Justice Department this week said it found no competitive harm from the deal and refused to issue a consent decree. That means the transaction would not be subject to judicial review, like the Tunney Act proceedings that have been ongoing since May regarding the AT&T-SBC and Verizon-MCI combinations.

The FCC meeting to discuss the deal was on hold more than three hours on Friday, until the FCC said the meeting had been canceled.

The delays came as commissioners reportedly continued negotiations with AT&T and handled emergency motions filed by opponents of the $80 billion deal. Various media reported the FCC had met overnight with AT&T executives, and competitive carriers XO Communications Inc. and NuVox Communications responded by maintaining those negotiations violated the FCCs open-disclosure rules. Both XO and NuVox filed emergency motions asking the FCC to disclose all communications it had with AT&T in the hours just before the FCC’s expected vote on the AT&T-BellSouth merger.

AT&T reportedly has submitted concessions on the merger, but it was not immediately known what they were. On Thursday, Reuters quoted a senior AT&T lawyer as saying: We have put a full set of conditions on the table that are reasonable and protect consumers. I want a deal with these guys; we want a 4-0 vote.

Company spokesman Michael Balmoris issued a statement saying AT&T looks forward to the November meeting, when we expect the FCC to complete its review, approve the merger and allow us to begin delivering the numerous benefits of the merger to consumers. He added  the carrier is open to discussing with the Democratic FCC Commissioners reasonable conditions on the merger in order to obtain unanimous approval, so long as they do not affect our ability to deliver merger benefits to customers and shareowners, given the intensely competitive environment in which we operate.

AT&T Inc. www.att.com
BellSouth Corp. www.bellsouth.com
FCC www.fcc.gov