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FCC's McDowell out on AT&T/BellSouth merger

by Matthew Lasar  Dec 18 2006 - 3:15pm     

Federal Communications Commissioner Robert M. McDowell announced today that he will not vote on AT&T's proposed merger with BellSouth.

"The American people expect their public servants to make tough decisions, and I have not hesitated from doing so in my brief tenure here at the Commission," McDowell told reporters at a press conference held this afternoon. " . . . All too often, especially recently, they have been disappointed by those who hold public office. I hope that this is one instance where they are not disappointed."

McDowell, a former lobbyist for the Comptel telecommunications trade group, cited an ethics agreement he signed with the FCC just prior to his appointment to the agency. The document required him to absent himself from any matter concerning Comptel for a year following his resignation from the group.

"The AT&T/BellSouth merger would be just such a matter," McDowell explained.

The Commission has been deadlocked 2/2 for months over whether to approve the merger, which would give AT&T control over almost half the land lines in the United States. The agency's two Democrats and two Republicans have been unable to agree on the conditions under which the FCC would grant AT&T the right to buy BellSouth.

Last week, at the request of FCC Chair Kevin Martin, the agency's General Counsel Sam Feder ruled that, based on past precedent, McDowell's voting on the AT&T/Bellsouth question would not constitute an ethics violation. But McDowell called the decision a weak gesture that omitted any discussion of the ethnics agreement.

"In all candor, however, I had expected a memorandum making a strong and clear case for my participation," he said. "Instead, the Authorization Memo is hesitant, does not acknowledge crucial facts and analyses, and concludes by framing this matter as an ethical coin-toss frozen in mid-air. The document does not provide me with confidence or comfort."

McDowell argued that his absence should not prevent the FCC's four Commissioners from coming up with a compromise approval on the merger.

"I have also tried hard to encourage some of my colleagues on the Commission to negotiate in good faith – sadly, to no avail," he said. " . . . It appears that the lingering question of my involvement is being used as yet another excuse for delay and inaction. So, to remove that excuse from the equation, I am announcing my decision this evening."

In the short run, McDowell's absence from this decision either stalls the merger, or will force AT&T to make concessions to win its goal. In October, prior to the deliberations over McDowell's possible involvement, AT&T offered the FCC a series of commitments on net neutrality, service rollouts to low income areas, and even a one million dollar donation to a public safety foundation.

It is unclear whether the FCC will revisit those offers now that McDowell has taken himself out of the picture, at least until May 31st 2007, the one year anniversary of his resignation from Comptel.


 
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