Several months ago, the U.S. Court of Appeals for the D.C. Circuit told the Federal Communications Commission that they were not entitled to ask for certain documents in their review of AT&T’s proposed merger with DirecTV. The FCC was asking for documents from the telecom companies that went into detail about TV programming contracts the telecoms had with CBS, Fox, Walt Disney & Viacom. The Court found that the FCC’s demand would potentially reveal sensitive contract information to third parties.
Even though the FCC already has a system in place to protect confidential business information from being released, there was a worry that “rivals were taking advantage of the situation to gain easy access to sensitive details about affiliate fees and other contract points.”
Essentially, the broadcasters were worried that the actual details would be released and the public would see the full extent of the financial agreements that cause their bills to be raised on a monthly basis. We have seen the embarrassment that can be caused when documents are released which clearly contradict the PR spin being put on by the companies wanting to merge.
During the failed AT&T/T-Mobile merger, a law firm working on AT&T’s planned $39 billion acquisition of T-Mobile accidentally released a document which completely tore apart all of the justifications for the merger to be approved.
- While AT&T was publicly claiming that they couldn’t match Verizon’s planned 97% LTE coverage without acquiring T-Mobile, this documents showed otherwise and in fact made the point that AT&T had no interest in substantially expanding their LTE network.
- While AT&T claimed that the merger would be part of an $8 billion investment which would create thousands of jobs, the document clearly shows how AT&T skewed that investment number and never actually proved where these jobs would come from considering AT&T is openly continuing to cut landline jobs.
So, why are we to believe AT&T executives when they tell the public that the DirecTV deal would generate “savings and cost reductions should top $2.5 billion” without providing any substantial facts for those numbers? In fact, considering taxpayers hand over billions upon billions to AT&T and other telecom companies yearly, why would we not be able to see just about every document? Nevermind that the public gets just about nothing from these insane tax breaks given to the telecom companies.
As Sen. Dean Heller (R-Nevada) noted in a letter to the FCC, orders “that have significant impact on the industry are crafted based on information provided in secret and go unchallenged.” Heller also wrote that by making the process as public as possible, we would be putting persons or entities on the record. Which is something that will never happen.
Fast forward to today and now Charter’s acquisition of Time Warner Cable is dealing with another round of what is or isn’t legally mandated to be handed over to the FCC. Due to the recent court decision, everyone is waiting on the FCC to issue new orders which state what information must be submitted in connection with the Charter-TWC merger.
Even though the FCC’s stated goal is to “protect sensitive information while still allowing the public to participate in the process,” I suspect we will see any and all information that puts the companies in a bad light to be put under the rug so that they won’t be forced to deal with those pesky public advocacy groups.