Wow! Well, this is a bit of a surprise. The US government, who had been rubber stamping various mergers for a while now, especially in the telco/broadband space, may finally have had enough. The Justice Department has officially moved to block the merger, technically filing a lawsuit against it on antitrust grounds. From the beginning, most people had assumed that no one would block the merger, though in the last few weeks there were definite rumblings suggesting that the tides were shifting. Even so, having the DOJ jump in with a lawsuit is a surprise. AT&T insists that the move was a surprise to it as well, which is also a bit odd. Typically, the DOJ tends to telegraph this kind of move, in order to either pre-emptively end the merger attempt or to get much greater concessions. It's not entirely clear what pushed the DOJ off the fence on this one, but AT&T accidentally revealing that it had lied about the key reasons for the merger couldn't have helped...

Sometimes you wonder if there's some sort of competition between airlines, banks and telcos as to who can come up with the more ridiculous "fees" to add. AT&T, which last we checked, was still trying to get a merger approved that it claims will benefit customers, has now decided to add a $2/month fee for people who don't have a long-distance plan. In other words, pay more, for less! This comes on top of a whole series of other ways to limit consumer choice while increasing what they have to pay. As Broadband Reports notes:

AT&T imposed new usage caps on broadband users without making sure the meters work. They followed that up by cracking down on unofficial tetherers (imposing a fee for doing nothing while crippling smartphones) and then substantially jacking up the price of SMS service by killing off one of their most popular SMS plans.

But have no fear, once AT&T gets T-Mobile and there's even less competition in the mobile space, we're sure that such practices will only... er... increase.

A few weeks ago, AT&T accidentally revealed that it had a plan to cover 97% of the population with its 4G/LTE service. That's a big deal, because a big part of the rationale for the T-Mobile merger was that it simply could not deliver that kind of coverage without the merger. AT&T has worked furiously since then to basically deny what the filing clearly stated. They've been doing so by trying to change around what basic words mean (which is kind of funny). However, it looks like they haven't convinced one rather important player. The FCC is now asking for evidence that AT&T actually needs T-Mobile as it keeps claiming. It's still pretty likely that this all gets approved, but it definitely has presented pretty clearly how the rationales being given for why this deal is "necessary" are hogwash. No one denies that it will be much easier for AT&T, but that's not the same thing as necessary.

One of the key talking points from AT&T in support of the T-Mobile merger is that it "needs" T-Mobile's spectrum in order to expand its planned 4G/LTE networks to cover 97% of the population. And, there's no doubt that having T-Mobile's spectrum will make it easier, but that's not the same as it being necessary. As Broadband Reports has been pointing out for a while, Verizon has less spectrum than AT&T but can cover the same 97% of the population with it. Apparently a lawyer for AT&T accidentally posted a document to the FCC's site that more or less admits that AT&T doesn't need T-Mobile's spectrum, and that it could invest $3.8 billion to catch up to Verizon in terms of LTE coverage. $3.8 billion is a fair bit of money, but it's a hell of a lot less than the $38 billion that it's spending for T-Mobile. Yes, AT&T also gets T-Mobile subscribers with that, but it certainly raises questions about AT&T's claims that it would be too "costly" to invest to get to 97% coverage with its existing spectrum. As BBR notes, the timing of the letter also suggests that AT&T knew it was planning to buy T-Mobile when it decided to claim that it would "not" build out its network, perhaps recognizing that this would help give it a talking point for why the merger should be allowed.

For years, we've covered how slimy DC-insiders and secretive "lobbying" firms have a list of "interest groups" that they "fund" in order to use them to support various initiatives they don't really care about. The telling quote from someone involved in these astroturfing efforts:

"You go down the Latino people, the deaf people, the farmers, and choose them.... You say, 'I can't use this one--I already used them last time...' We had their letterhead. We'd just write the letter. We'd fax it to them and tell them, 'You're in favor of this.'"

AT&T has been working overtime on this front, and we've seen random groups who really are unlikely to have any interest in the AT&T/T-Mobile merger come out in favor of it, culminating in the ultimate in ridiculous arguments, from a rural education group, that the merger would help kids do better in school (yes, seriously).

Of course, this still goes on because there's almost no downside. We can call it out every time it happens, and most people just don't seem to care very much. But, every so often, actual members of these groups recognize the problems with such things, and they speak up. Broadband Reports has the news of how GLAAD's boss has been pressured into resigning after membership grew quite concerned about GLAAD's sudden endorsement of the merger -- and some connections between the company and the organization are suddenly being scrutinized. Whether or not you agree with the merger, it seems pretty sleazy to line up random interest groups in support of or against it.

It's tragic that this is the way of DC. It's not about doing what's right, or focusing on the best argument possible. It's a purely cynical land grab about who can do whatever it takes to get certain things rammed through. It's nice that, just once, there are repercussions for some of the organizations that let themselves be flat-out used in this manner.

In the typical push to get big mergers approved, we often see particularly dumb arguments. Sometimes these involve astroturfing attempts or lobbyists signing arguments for others (or sometimes forging the letters entirely). And then, sometimes, the companies just get people to push crazy arguments on the off chance that someone might believe them. Take, for example, this absolutely bizarre claim from the executive director of the Texas Rural Education Association, Don Rogers, that allowing AT&T to buy T-Mobile would be good for Texas schools:

The proposed merger between AT&T and T-Mobile will be a giant stride toward providing ALL Texas children quality educational opportunities and experiences. Every Texas student, whether they attend school in inner-city Houston or in rural West Texas, should have access to modern technological advancements, including high-speed wireless Internet.

The resources made available by the merger would make high-speed wireless available to many Texans, both rural and urban. This is vitally important for schools in rural Texas that will finally have the ability to access a high-speed wireless broadband network and all it brings.

He doesn't explain much further. He does explain the importance of wireless broadband, which is great, and we agree that there should be more of it, especially for schools. But what does allowing AT&T and T-Mobile to merge have to do with that at all? The real answer is nothing whatsoever. Nothing in the merger will make it any more or less likely that Texas schools will get mobile broadband. But, Rogers is sure of it:

I know of what I speak when I say that Texas--in particular our rural schools--will benefit substantially from this merger. To deny the educational opportunities this merger would provide to students living in rural areas would do our children a disservice. This merger will ensure that every young Texan will be learning and performing to the best of their abilities.

I know of what I speak when I say the above is pure hogwash. Whether or not you think the merger makes sense, it has nothing whatsoever to do with broadband in schools. And it certainly would not "ensure" that "every young Texan will be learning and performing to the best of their abilities." It's incredibly disingenuous for someone supposedly heavily involved in children's education to suggest that some totally unrelated corporate merger will somehow "ensure" that kids are learning to the best of their abilities.

Following the story of FCC commissioner Meredith Atwell Baker joining Comcast as a lobbyist just a few months after approving that company's buyout of NBC Universal, the group Free Press is asking the remaining FCC commissioners to take a pledge that, if they vote to approve the AT&T/T-mobile merger, they won't then take a lobbying job with AT&T. Of course, if any of them took the pledge, it's not clear what's to stop them from then breaking the pledge...

While there's been plenty of concern in the past couple weeks about Apple's iPhone/iPad location data, followed by Google's Android location data, plenty of people pointed out from the beginning that what both companies have done completely pales in comparison to the sort of data that mobile phone operators regularly collect on you. Even as lawsuits have been filed against both Apple and Google, few of the people who are really upset about those two companies seem to recognize that what the operators have is much, much more complete. The mobile operators, apparently fearing that people may start to realize this, have become a bit proactive and are trying to convince everyone that the real problems are elsewhere -- specifically with apps on phones, not with the service providers. You see, don't worry about all the data we collect. Just look at what those apps are doing:

AT&T noted it “plays no role” in what kind of information smartphone apps collect, while T-Mobile pointed out the ways in which that data can be used.

Sprint lamented “consumers no longer can look to their trusted carrier with whom they have a trusted relationship to answer all of their questions,” particularly on privacy.

And Verizon Wireless called out smartphone app makers directly on the issue, stressing “location-based applications and services (whether provided by us or third parties such as Google) should give customers clear and transparent notice” and control.

This was in response to questions from Congressional Reps. Ed Markey and Joe Barton, leading all of the operators to also admit that they collect such data as well, but really, apps. Apps are a bigger issue. Just focus on the apps. Really. Apps.

A few years back, we discussed an article by Declan McCullagh, which laid out some of the sneakier tactics of lobbyist groups to pressure the government to support some position using letterhead from various special interest groups:

"You go down the Latino people, the deaf people, the farmers, and choose them.... You say, 'I can't use this one--I already used them last time...' We had their letterhead. We'd just write the letter. We'd fax it to them and tell them, 'You're in favor of this.'"

It looks like AT&T's lobbyists went through the list and they're back around to the top with the "Latino people." Suddenly, and for no clear reason, The Hispanic Institute and the Latino Coaltion have decided that supporting the merger of AT&T with T-Mobile is of utmost importance to them. They've put out statements with such nonsensical claims like:

The proposed merger of AT&T and T-Mobile holds great promise for all Americans, and especially those of Hispanic heritage.

What's in it for these groups? Money, mainly:

One DC insider informs us that rumblings on K Street suggest AT&T had called every civil rights group in the United States for support within fifteen minutes of the deal being announced. Fearful of losing AT&T donations -- most of these groups quickly got to parroting prepared AT&T statements, unconcerned about the actual impact of a T-Mobile deal. Getting funding for a new events center apparently dulls any ethical pangs felt using your organization as a hired stage prop.

It's really difficult not to be cynical when you see this kind of thing playing out. What's really depressing is that no matter how many times this rather obvious practice is exposed, it just keeps on happening.

We just wrote about how Max Davis, who's trying to create a silly and totally pointless compulsory licensing system for MMS content was more or less laughed out of court in the lawsuit he filed against the mobile operators, claiming that they were running illegal P2P file sharing programs in the form of their MMS capabilities. It apparently took him all of a few days to come up with a new, perhaps even more ridiculous strategy: he's suing AT&T, Verizon, Sprint, T-Mobile and TracFone for supposed antitrust violations over the same basic issues. Once again, it seems clear that this is an incredibly weak (and almost certainly unproductive) attempt at getting these companies to agree to his pointless licensing scheme.

So how are these mobile operators guilty of antitrust violations? According to Davis:

Defendants purposely conspired via collusion to install themselves as the new primary gate keepers and sole beneficiaries of multimedia content sharing through their new MMS technologies.

Except, of course, that's ridiculous. These companies did agree to set up MMS systems, but that's because they're the mobile operators who run the mobile networks. That's not collusion. And it's not antitrust. The filing gets more ridiculous as it goes on. He claims that these operators do not qualify as DMCA service providers, contrary to the pretty clear language of the law and plenty of case law. The whole thing seems frivolous, and it seems likely that this lawsuit will reach a similar conclusion to the previous one.