1970 Consent Decree Bearing Fruit in Minority Support for AT&T/T-Mobile

Among supporters of the merger have been the national NAACP, and six branch offices, and numerous groups representing women and Hispanics. “Our success has in part been made possible by companies like AT&T who have directed significant portions of their procurement spend to minority-owned businesses,” said the United States Hispanic Chamber of Commerce in a filing typical of those made at the FCC in support of the merger. “AT&T has continually been recognized as a leader in supplier diversity, not only by our association but by other nationally recognized organizations."

The AT&T Foundation made nearly $62 million in contributions in 2009, according to the group’s IRS Form 990. A review of the gifts found some to minority groups, among the thousands of contributions made across the country, many under $1,000. For example, the foundation gave $57,350 to the Community NETwork African American Telecommunication Professionals of AT&T, $50,000 to 100 Black Men of North Metro, Inc., in Roswell, Ga., $5,122 to Asian Pacific Islanders for Professional & Community Advancements and $4,859 to Filipino American Communications Employees

In 1970, the Equal Employment Opportunity Commission, the Department of Labor, the Department of Justice and AT&T, which was then the nation’s largest private employer, signed a consent decree aimed at eliminating discriminatory recruiting, hiring and promotion practices against women and minorities. AT&T agreed to pay out $15 million to 13,000 women and 2,000 minority men and $30 million in immediate pay increases for women and minority employees of the Bell System.

"Forty years after that ground-breaking decree, the minorities and women that AT&T began to hire have reached middle and upper management,” said Andrew Schwartzman, senior vice president of the Media Access Project. “Before and after the breakup of the old AT&T, Ma Bell and its progeny have developed strong relationships with minority communities for the right reasons -- their corporate cultures adapted to changes in American society faster than other companies of the same size."

But Schwartzman, a merger opponent, said AT&T may be misusing the trust from various groups. “I want to be clear that I think in this instance AT&T has exploited these relationships of trust by getting some organizations to sign on to misleading statements and convincing them to believe overblown promises,” he said. “In the end, as these groups begin to understand what is really at issue, AT&T’s hard-won relationships will suffer from this abuse."

David Honig, president of the Minority Media & Telecom Council, which supports the merger, said the 1970 consent decree was critical in shaping AT&T. “AT&T has had a tremendous impact on ensuring a diversified workforce across the nation, providing meaningful career opportunities to minorities and women for over three decades,” Honig said. “The company’s leadership in this area has helped shape and define equal opportunity employment practices in the workplace, and its actions serve in many respects as the benchmark for other companies to measure up against. This is a significant commitment that AT&T has made to their workforce and it shows.”

AT&T’s diversity record isn’t the only reason MMTC supported the deal, Honig said. Broadband deployment is critical for minorities, he said. “We focused on the impact of the merger on the spectrum crunch and, hence, on affordability and adoption as factors in closing the digital divide."

"Though the law and facts will largely guide FCC and Justice Department reviews, it certainly doesn’t hurt that African American groups and other elements of the Democratic base back AT&T’s proposed acquisition of T-Mobile,” said Jeff Silva, analyst at Medley Global Advisors. “However unsavory or cynical the notion may be, it would be naive to believe you can fully separate out policy choices from political considerations with respect to government review of a major merger or most anything else in a presidential election cycle.”

"For decades, AT&T has proudly supported numerous diverse groups and organizations,” a spokesman for the carrier said.

Meanwhile, give and take on the merger continues. AT&T will file its opposition to various petitions to deny at the FCC on Friday.

CPUC to Take Up Merger

The California Public Utilities Commission is slated to consider Thursday an order that would launch a state investigation of the deal. The consumer-oriented Greenlining Institute asked the CPUC to launch a probe. “While regulatory authority to block the merger rests with the federal government, the results of investigations by official state bodies like the CPUC would carry significant weight,” the group said Wednesday.

The FCC received some 50 petitions filed by various parties, including two NASUCA members, asking the FCC to deny AT&T’s proposed buy of T-Mobile, the National Association of State Utility Consumer Advocates said in a filing at the FCC. The New Jersey Division of Rate Counsel and Utility Consumers’ Action Network were among those filing petitions against the merger. “Taken singly or together, these Petitions -- along with the many other Petitions to Deny -- provide more-than-adequate support for the Commission’s denial of this application,” NASUCA said.

Meanwhile Deutsche Telekom sought “second-degree” protection for many of the documents it is filing at the FCC in response to information requests from the agency. “In past transactional proceedings, the Commission has issued second protective orders to exclude access to such information by other parties’ inside counsel who are not involved in competitive decision-making,” DT said. “Similar protections are warranted in this proceeding.”