April 1, 2011 / 2:00 AM / in 7 years

FCC's Copps not pleased with AT&T bid for T-Mobile

WASHINGTON (Reuters) - The wireless megamerger of AT&T Inc (T.N) and T-Mobile will be a tough sell, said the senior Democrat at the U.S. Federal Communications Commission in an interview with C-SPAN provided to reporters on Thursday.

<p>Reflections are seen in the window of an AT&amp;T store in New York March 21, 2011. REUTERS/Brendan McDermid</p>

FCC Commissioner Michael Copps said AT&T’s $39 billion bid to buy Deutsche Telekom AG’s (DTEGn.DE) T-Mobile USA “may be an even steeper climb” than the Comcast-NBCU merger, which he voted against.

Still Jim Cicconi, AT&T’s chief of public affairs who is leading the lobbying effort for the merger, told reporters this week he was optimistic the merger would be approved.

The deal would concentrate 80 percent of U.S. wireless contract customers in just two companies -- AT&T/T-Mobile and Verizon Wireless, a joint venture of Verizon Communications (VZ.N) and Vodafone Group Plc (VOD.L).

Copps said he was concerned about the amount of power and influence the merged company would hold, given that two companies would virtually control the wireless landscape.

The merger requires approval by the FCC and Justice Department.

The deal seemed to be distracting the FCC from other issues, Copps said in the interview, which will air on Saturday. “This affects so much of what we’re doing.”

He said the “paradigm-altering transaction” could affect incentive auctions to compensate broadcasters for giving up some of their spectrum for sale to wireless companies.

Copps said if AT&T were to get a majority of the FCC on board, conditions for approval would need to include market-by-market divestitures and a requirement to preserve the openness of the Internet.

AT&T’s Cicconi told reporters he expected regulators to hone in on certain areas. “We’ll do our best to answer their questions and their concerns in that process, and if need be come up with creative ways of doing that,” he said.

Cicconi said official merger documents would be filed with the FCC in a few weeks.

Reporting by Jasmin Melvin; Editing by Richard Chang

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