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US senator seeks answers from AT&T, T-Mobile execs
May 6, 2011 / 9:15 PM / in 7 years

US senator seeks answers from AT&T, T-Mobile execs

* Klobuchar questions AT&T, T-Mobile on merger

* Seeks consumer protections, commitments on pricing

* Senate panel holds hearing Wednesday

By Jasmin Melvin

WASHINGTON, May 6 (Reuters) - A senator is asking AT&T Inc (T.N) and T-Mobile about their commitment to lower-priced plans and to maintaining current employment levels ahead of a congressional hearing on their proposed merger.

Senator Amy Klobuchar sent a letter to the companies raising a series of concerns about the deal prior to the May 11 hearing by the Senate Judiciary’s antitrust subcommittee.

“AT&T and T-Mobile ought to be forthright and transparent with their customers about the potential effects the merger might have on prices and the quality of service,” Klobuchar said in a separate statement.

AT&T announced plans in March to acquire Deutsche Telekom AG’s (DTEGn.DE) T-Mobile USA in a $39-billion bid.

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

AT&T, the No. 2 U.S. mobile carrier, has argued the merger would spur innovation, improve the quality of its services and expand wireless service to 97.3 percent of Americans. The combined companies would overtake current industry leader Verizon.

Klobuchar, a Minnesota Democrat and member of the antitrust panel, sent her letter to AT&T Chief Executive Randall Stephenson and T-Mobile USA CEO Philipp Humm.

She asked whether the merger would allow the combined company to reach more rural areas than simply signing data roaming agreements with T-Mobile and other carriers. And she questioned the effect of less competition on early termination fees and cell phone exclusivity clauses.

“We’ve received the letter and look forward to providing the Senator with information on the consumer benefits of the merger between AT&T and T-Mobile,” an AT&T spokesman said.

Congress has no direct role in reviewing the merger but has oversight of the Federal Communications Commission and Justice Department. Those two agencies are expected to take a year to complete their reviews.

Stephenson and Humm are due to testify on Wednesday to the Senate panel, along with major critics of the deal: Sprint Nextel Corp (S.N) CEO Daniel Hesse and Cellular South [TELAPC.UL] CEO Victor “Hu” Meena. (Reporting by Jasmin Melvin; Editing by Tim Dobbyn)

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