AT&T AND T-MOBILE MERGER:

A BAD DEAL FOR COMMUNITIES OF COLOR AND THE POOR

If the purchase of T-Mobile by AT&T is approved by federal regulators, it will be a disaster for all mobile phone users especially for people of color and low-income communities in rural and urban areas, who depend upon mobile phones for their primary access to communication and often as their only gateway to the Internet. The takeover will inevitably lead to fewer choices and higher prices for mobile service, and a loss of as many as 20,000 jobs for T-Mobile employees, many of whom come from communities of color.

WHATS AT STAKE If the merger goes through, just two companies, AT&T and Verizon, will control nearly 80% of the mobile market in this country. The loss of a low-cost wireless carrier like T-Mobile will negatively impact communities of color.

THIS MERGER WILL COST JOBS With unemployment still around 9% and millions of people underemployed, its more important than ever that we protect as many jobs as possible. Reality: Unemployment remains stubbornly high, standing at 9.1% in July 2011. During this same period, the unemployment rate was 11.3% for Latin@s and 15.9% for blacks.1 Merger Concerns: In 2009, T-Mobile ranked among the 100 Best Companies to Work For according Fortune magazine. In that survey, T-Mobile was in the top 10 companies when it came to workforce diversity, reporting that 48% of its 39,000 workers at that time were minorities [sic].2 If the merger goes through, as many as 20,000 of those T-Mobile workers could lose their jobs.3

1 Bureau of Labor Statistics, August 5, 2011, Employment Situation News Release. Retrieved August 5, 2011, from United States Department of Labor: http://www.bls.gov/news.release/pdf/empsit.pdf 2 http://money.cnn.com/magazines/fortune/bestcompanies/2009/minorities 3 http://www.hu ngtonpost.com/art-brodsky/labor-leads-netroors-and_b_883131.html

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AT&T AND T-MOBILE MERGER: A BAD DEAL FOR COMMUNITIES OF COLOR AND THE POOR

THIS MERGER WILL DECREASE THE AFFORDABILITY OF MOBILE SERVICE T-Mobile plans are more affordable than comparable plans of other carriers. Cost is a major barrier to accessing services. Reality: The poverty rate reached a 15-year high in 2009, with 13.4% of the population living in poverty (below $22,050 per year for a family of four). This rate is even higher in communities of color, with 21.9% of Latin@s and 25.1% of blacks living below the poverty line.4 Merger Concerns: Between 2001 and 2007, the amount consumers spent on telephone service increased each year. In just six years, the average amount consumers spent on these services went up by nearly $200.5 T-Mobile plans cost $15 to $50 less per month than comparable plans from AT&T. If the merger goes through, new subscribers will no longer have T-Mobile as a lower-cost optionwhich would both restrict access and allow AT&T and all other providers to raise rates more easily. Even current T-Mobile subscribers who migrate to AT&T plans should expect a signicant price increase.6 While AT&T has suggested that T-Mobile customers can keep their current rates as long as they stick with comparable devices, AT&T has not explained just how this supposed commitment will workespecially if current T-Mobile customers want to or are forced to upgrade their phones. That means roughly 15.9 million people of color who are T-Mobile customers can expect to see a price increase for their mobile phone service if this merger is approved.7

THIS MERGER WILL REDUCE CHOICES FOR MOBILE VOICE AND INTERNET ACCESS A horizontal mergerbetween AT&T, the second-largest mobile phone service provider in the U.S., and T-Mobile, the fourth-largestwould create a consolidated mobile phone market, with little to no meaningful competition. Reality: There is already a lack of competition in the wireless market, and consumer choice is limited by lengthy service contracts and high early-termination fees that make it difcult to switch to a new service provider. Merger Concerns: If the merger is approved, mobile phone users who want nationwide service or a good phone will be forced to select from one of only three providers: AT&T, Verizon, or Sprint. Even worse, AT&T and Verizon will control nearly 80% of the market. Neither Sprint nor other small carriers will be able to compete with AT&T or Verizon.
4 U.S. Census Bureau, 2010, Selected Characteristics of People at Speci ed Levels of Poverty in the Past 12 Months. Retrieved June 14, 2011, from U.S. Census Bureau: http://fact nder.census.gov/servlet/STTable?_bm=y&-geo_id=01000US&-qr_name=ACS_2009_5YR_ G00_S1703&-ds_name=ACS_2009_5YR_G00_ 5 Bureau of Labor Statistics, January 14, 2009, Consumer Expenditure Survey. Retrieved June 14, 2011, from United States Department of Labor: http://www.bls.gov/cex/cellphones2007.htm 6 Blyskal, J., April 8, 2011, CR Analysis: T-Mobile Is Cheaper than AT&T. Retrieved June 7, 2011, from Consumer Reports: http://news. consumerreports.org/electronics/2011/04/cr-analysis-t-mobile-is-cheaper-than-att.html 7 T-Mobile USA, February 25, 2011, T-Mobile USA Reports Fourth Quarter 2010 Results. Retrieved June 13, 2011, from T-Mobile: http://s.tmocache.com/Cms/Files/Published/0000BDF20016F5DD010312E2BDE4AE9B/5657114502E70FF3012B5A79D454F2C8/ le/ TMUSQ42010PressReleaseFinalv2.pdf; Rocha, J.,2010, Mobile and Social in Hispanic America 2010. Retrieved June 7, 2011, from Slide Share: http://www.slideshare.net/jerryrocha/hispanic-mobile-and-social-networking-for-ad-tech-11410

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AT&T AND T-MOBILE MERGER: A BAD DEAL FOR COMMUNITIES OF COLOR AND THE POOR

THIS MERGER WILL HARM ADOPTION OF INTERNET AND ADVANCED COMMUNICATION SERVICES AMONG PEOPLE OF COLOR The world is changing and, increasingly, access to the Internet determines who stands to benet from the new economy, and who is left behind. Nowhere in the U.S. is the shift to Internet access through mobile phones making as much of an impact as in black, Latin@, and low-income householdswhere mobile phones are often the primary tool used to get online. Reality: 46% of blacks and 51% of Latin@s access the Internet via mobile phones, versus 38% of the general population. Merger Concerns: For many people of color, a mobile phone is the only point of access to the web, with 18% of blacks and 16% of English-speaking Latin@s being cell-only Internet users, compared with 10% of whites.8 Nearly 50% of T-Mobiles customers are people of color, which is higher than every other wireless carrier.9 This merger would lead to increased prices, reduced choice, and reduced innovation, all of which would depress adoption rates among communities of color.

THIS MERGER WILL INHIBIT COMMUNITY ENGAGEMENT AND DEMOCRATIC PARTICIPATION People of color are among the fastest-growing constituencies in the United States and the most active users of mobile devices as a primary tool for activism, community engagement, and democratic participation. Mobile devices are being used for online organizing, text-based migrant rights campaigns, voter registration, and more. Reality: Without accessible mobile communications services, communities of color will lose this crucial venue for civic participation. Yet the free ow of ideas, creativity, information, and entrepreneurship is essential to our democracy. Merger Concerns: AT&T opposes any mobile Network Neutrality requirements, and it has a history of denying its customers access to the applications that they want. For example, AT&T has blocked Google Voice, Skype, and Slingbox applications in the past.

8 Smith, A., 2010, Mobile Access 2010 (Washington, DC: Pew Internet & American Life Project). 9 Rocha, J.,2010, Mobile and Social in Hispanic America 2010. Retrieved June 7, 2011, from Slide Share: http://www.slideshare.net/ jerryrocha/hispanic-mobile-and-social-networking-for-ad-tech-11410

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