Sanchez: Latinos Would Benefit From AT&T Merger

Alex Nogales’ July 28 opinion piece seriously underestimates the level of support and mischaracterizes the effect of the proposed merger of AT&T and T-Mobile USA on the Hispanic community.

Let’s look at Nogales’ objections in turn.

Nogales leads off by claiming that not all civil rights organizations support the merger. He is correct on this point. Not all do; just a vast majority of the largest civil rights organizations — Latino, African-American and Asian — support the benefits of the merger.

Since his article is about the Latino community, he goes on to list the two Latino organizations that have jointly filed a petition to deny — the National Hispanic Media Coalition and the National Institute for Latino Policy — and one organization — the Latino Business Chamber of Greater Los Angeles — that has expressed concerns.

That is the sum total of the major Latino organizations that he could find to support his bold claim that not all are supportive.

On just one letter alone, filed at the end of May 2011, 14 of the largest national Hispanic-serving organizations — the ASPIRA Association, Hispanic Federation, Labor Council for Latin American Advancement, League of United Latin American Citizens, MANA — A National Latina Organization, National Conference of Puerto Rican Women, National Hispanic Council on Aging, National Hispanic Medical Association, National Puerto Rican Coalition, SER — Jobs for Progress National, United States Hispanic Chamber of Commerce, United States Hispanic Leadership Institute, United States-Mexico Chamber of Commerce, and CNC (formerly Cuban American National Council) — came together to file a letter of support for the potential benefits of the merger.

“As community leaders, we have been advocating for more and faster access, adoption and affordability so that the people we serve will be in a better position to take advantage of the evolving digital economy,” the letter stated. “As such, we believe this merger could provide opportunities to achieve many of these objectives by bringing the possibility of faster, smarter wireless networks to more Hispanics, further shrinking the digital divide, and bringing more Latinos in more places a critical tool to achieve the American Dream.”

These organizations and a majority of other national Latino civil rights organizations — including my own, the National Hispanic Foundation for the Arts — are all expressing optimism for the merger as beneficial to the Latino community for precisely the reasons that Nogales is trying to claim the opposite.

He suggests that “consumers who rely on national providers to ensure they can connect no matter their locale, would be forced to select from one of only three providers.”

His concern is unfounded. Consumers who are mobile would greatly benefit from the expanded broadband footprint, covering 97 percent of all Americans, that the merger will provide them. This expanded map will go to historic lengths to ensure that Latino workers can connect to their friends and families no matter their locale. And if they chose to go to a competitor, customers of the other carriers would still be able to connect with the expanded AT&T network.

He then claims that the merger will lead to price increases and fewer choices that would disproportionately harm Latinos. These arguments are incorrect and misunderstand the basic benefit of the merger for everyone.

First, T-Mobile customers may keep their existing contracts for as long as they keep their phone. Second, Nogales ignores no less of an authority than the Government Accountability Office, which reported that “consolidation may have helped the biggest carriers become more efficient, allowing them to offer more services for similar or lower prices while improving coverage.”

Prices in the wireless industry have dramatically fallen for both voice and data — including after every other industry consolidation. I have to ask, why would this merger be any different and why would competitors not compete after this particular merger?

Next, Nogales suggests, without offering evidence, that the merger will lead to layoffs. Most of the cost savings the merger will bring will come from consolidation of the two companies’ networks, not from large layoffs.

More important, though, AT&T’s $8 billion investment to expand the network to reach tens of millions of underserved Americans around the country will itself bring jobs in all areas of telecommunications, from manufacturing to sales.

The nonpartisan Economic Policy Institute believes that 55,000 to 96,000 new jobs will result from this investment. That’s one reason the Communications Workers of America strongly supports the merger.

Finally, Nogales writes that “Latinos — more than any other demographic group — rely on mobile phones for communication, democratic participation, civic engagement and economic empowerment.” He is precisely correct on this point as well — and that is precisely why the merger and the resulting expanded high-speed broadband network is good for the Latino community, as it is for all Americans.

Felix Sanchez is president and CEO of the National Hispanic Foundation for the Arts.