(Fred Weinberg/The Penny Press) – Last week, some very nice people from AT&T came by our Elko offices to enlist our support in the battle they are waging with Federal regulators for approval of their acquisition of T-Mobile.
Since I happen to be a veteran of battles at the Federal Communications Commission, I told them that I really didn’t need to hear their pitch because I could not imagine a circumstance under which we would be against two telecommunications companies merging in the United States of America.
As regular readers know, we happen to own radio stations in the Western United States, but when the National Association of Broadcasters (NAB) decided to take the wrongheaded position that XM and Sirius Satellite radio should not be allowed to merge, we took the opposite position.
When that same august body of lobbyists decided that it would go against DirectTV and DISH Network merging—they were ultimately successful—we suggested that the NAB should worry about crappy radio and television and not the business arrangements of two satellite TV companies.
Whenever you hear someone blathering on about “restricting competition,” that’s usually code for “We don’t want to have to compete,” or “We’re looking for a way to shakedown a successful company.”
In the United States of America, anti-trust regulation has become a code for shaking down companies that are innovative and successful.
Technology has a way of making sure nobody has a monopoly on anything for too long.
Remember IBM? Your government spent millions trying to break it up. What broke up IBM’s monopoly was the personal computer, not the government.
Which brings us around to AT&T.
Back when Alexander Graham Bell invented the telephone (“Mr. Watson, come here. I need you.”), the only way two telephones could talk to each other was to be connected through a central switching office. And the only way someone in Brooklyn could talk to someone in Peoria, Illinois, was to have a wire network connecting those central switching offices.
So, the Bell Telephone Company was founded, which later grew into American Telephone and Telegraph. Because someone had to build a network of wires. And as it grew, AT&T set the standards for that network. But by the 1970s, plenty of manufacturers had developed their own phones to hook onto the AT&T network and AT&T fought it hammer and tong.
The concept of cellular phones had been invented in the 60s (by AT&T Labs) but our government wasn’t wild about the idea. So that technology wasn’t rolled out until the mid-1980s, and then only with the government’s very heavy thumb on the scale.
In the meantime, another branch of the government was breaking up AT&T.
And the reason AT&T was willing to be broken up was that their executives and scientists understood that a new era of network communications and wireless communications was coming soon and technology would have broken them up anyway.
Now, the laws of economics have reassembled the old AT&T into a new AT&T. They have a thriving Internet, network and cell phone business.
But do you really think that buying T-Mobile from the Germans is going to give them a monopoly?
You know who is against the merger?
People with no concept of what the Federal Government is supposed to do.
The truth is that not only is this merger not an impediment to competition, it will actually create it.
Let me explain.
Say I want to start Fred’s Cell Phone Company or FCPC for short.
I go to AT&T, Verizon, or Sprint and tell them that I want to be an MVNO (Mobile Virtual Network Operator).
They will compete with each other to set me up in business just like they helped set up Tracfone in business. In fact, they each have sales reps waiting to encourage me to become a cellular company. They’ll sell me minutes and even handsets to get me to market FCPC because if I get rich, they do OK as well. In fact, Tracfone happens to be among AT&T’s and Verizon’s largest customers.
With two-and-a-half really big companies (Sprint is kind of a self-made cripple) competing for minutes, do you really think cell prices are going to go up?
Even if they do, something else will come along to knock them off their pedestal.
Worrying about competition in the cell phone industry is such a waste of the Government’s time that Barack Obama ought to be ashamed of himself for allowing the executive branch to even get involved.
And that there is even a question here shows how far socialism has invaded our Government.