**Editor’s Note: Please click here for a recap of the biggest channel-impacting merger and acquisition news from August.**
The Communications Workers of America (CWA) is giving the Federal Communications Commission (FCC) reasons to put the kibosh on a merger between wireless giants T-Mobile and Sprint — despite the fact that a potential tie-up remains only speculation.
The union, which represents 700,000 workers in communications jobs around the country, said on Tuesday that 20,000 jobs could be lost if the companies get the green light to merge. Not only that, it would “[reduce] competition and [reward] two companies that illegally have ‘crammed and slammed‘ millions of customers,” references to the carriers allowing unwanted third-party charges to appear on customers’ bills.
CWA President Chris Shelton wants the FCC and Department of Justice to apply an eagle eye to any T-Mobile-Sprint deal, noting that his union will “fight back against” it.
“Allowing Sprint and T-Mobile to merge guarantees the loss of tens of thousands of U.S. jobs that would result from store closures and the consolidation of administrative work,” Shelton said. “Corporations and Wall Street applaud this ‘synergy,’ but employees and their families would bear all the costs of this merger.
“One of the FCC’s responsibilities is to ensure that mergers and other corporate actions are in the public interest. The massive job loss that this merger would cause is not in the public interest. The Sprint-T-Mobile merger would enrich a few corporate owners and investors at the expense of workers and consumers,” he added.
The job-loss estimate comes from a study by industry analyst Craig Moffett, who predicted that 3,000 retail stores would close if Sprint and T-Mobile joined forces, resulting in 15,000 personnel cuts. Another 5,000 jobs would go by the wayside at the companies’ corporate headquarters in Overland Park, Kansas (Sprint), and Bellevue, Washington (T-Mobile US).
Furthermore, “both Sprint and T-Mobile have a track record of closing U.S. call centers, committing workplace violations like cheating workers of overtime pay, and allowing abusive practices in the workplace,” the union stated.
As is customary when mergers are still just rumors, Sprint and T-Mobile are not commenting. And while this has been considered a possibility for years now, a Reuters report last month indicated that a deal could finally come to fruition.
If you think the CWA would naturally oppose all mergers of this ilk – not just large ones – the union claims that is supports telecom mergers when “the partners are fully committed to expanding their workforces and investing in our communities through improved services and broadband buildout.” Clearly, the CWA doesn’t feel that is the case here; although it’s worth noting that the Moffett analysis was done more than a year ago.
A merger of this size would no doubt draw close scrutiny from regulators, although not on the same scale that AT&T did in its pursuit of T-Mobile a few years ago — one that ended with the former backing away when it became evident it wouldn’t be approved. A Sprint-T-Mobile tie-up, while controversial, would still leave three large competitors of similar sizes duking it out for the consumer’s wireless dollar.