Campbell’s AT&T Crusade Rebuked In PSC Merger Vote

We didn’t get to this last week, but on Wednesday the Louisiana Public Service Commission voted 4-1 not to interfere with a planned merger between AT&T and T-Mobile. The Commission’s lone negative was Shreveport Democrat and potential gubernatorial candidate Foster Campbell, who reports say put on a show for the audience before going down to defeat.

Campbell, we’re told, opened his performance by stating that he didn’t understand all the technical aspects behind the merger – that the infrastructure investments AT&T planned as part of expanding their wireless network in Louisiana together with T-Mobile were over his head. Then he said he opposed the merger anyway.

To boil this down, Campbell as a member of the Public Service Commission has as part of his job the acquisition of a familiarity with that which the PSC regulates – meaning he needs to understand at least some of the technical aspects of things like public utilities and telecommunications systems, because if you don’t know how that stuff works you’re pretty unqualified to regulate it. And since Campbell has been on the PSC since 2003, he admits that he’s still unqualified after eight years on the job to do the job – unless, of course, you believe your job as a regulator is to babble about in pursuit of headlines.

But then Campbell – after admitting that he’s not qualified to intelligently discuss the issue of the merger – takes a position on it. And the position is that the market isn’t allowed to function until the lowest-common-denominator regulator, who after eight years on the job still doesn’t understand what he’s regulating, can be educated on what the market is trying to do.

Does that sound like a recipe for progress to you?

Bear in mind that, as we said in our first piece on this stuff, 45 states – whose regulators assumedly are in general more informed on these issues than Campbell admits to being – have already passed on the question of whether this merger is within their purview.

Naturally, Campbell didn’t persuade anybody. He got killed on a 4-1 vote, and the PSC decided to pass on the issue of the merger.

The PSC’s minutes of the meeting read as follows…

Commissioner [Clyde] Holloway [R-Forest Hill] made a motion to accept Staff Recommendation and approve the acquisition of T-Mobile by AT&T.  Commissioner [Eric] Skrmetta [R-Metairie] seconded this motion.  Commissioner Campbell offered a substitute motion to assign an ALJ and have a full but expedited proceeding.  This motion died for lack of a second.  Therefore, on motion of Commissioner Holloway, seconded by Commissioner Skrmetta, with Commissioners [Jimmy] Field [R-Baton Rouge] and [Lambert] Boissiere [D-New Orleans] concurring and Commissioner Campbell [opposed], the Commission voted to, based upon the information derived in  Staff’s 301.M review, not oppose AT&T’s proposed acquisition  of the stock of T-Mobile USA, Inc.

Commissioner Field directed Staff to intervene in and monitor the federal investigations of the proposed merger and keep the Commission abreast of any developments that suggest negative consequences for the Louisiana consumers.  If such developments occur, the Commission can take appropriate steps to achieve federal safeguards to protect Louisiana consumers.Commissioner Skrmetta directed Staff, in the event this merger is approved, to coordinate with ATT to provide quarterly reports to the Commission regarding access to capital, capital expenditures and the growth of coverage.

Field, long one of the adults on the PSC, correctly noted that the Commission doesn’t even regulate wireless telecommunications other than terms and conditions of cell-phone plans. The PSC handles land-line phone service, a market in which AT&T is a major player, but the merger with T-Mobile doesn’t have anything to do with that.

So Campbell was more or less laughed out of school on Wednesday. Most folks would recognize an epic fail and move on.

Not ol’ Bananas. Word is he’s bucking for another crack at the Governor’s Mansion this fall – and the state Democrat Party is so desperate for a candidate that they’re encouraging him to run – and that means he needs an issue and an accomplishment to run on.

And since he’s hated AT&T like poison for years, why not take this ball and run with it?

So this week Campbell is showing his case of the screaming reds to anybody who cares to look

Louisiana Public Service Commissioner Foster Campbell blasted his fellow Commission members for favoring AT&T’s takeover of T-Mobile, noting that they “missed an opportunity to hold the state’s largest telecommunications company accountable for poor service.”

“Over the past 12 months I’ve had 639 telecom complaints in my north Louisiana PSC district, and 593 of them – more than 90% – were about AT&T,” Campbell said.

He added, “Now the Commission has voted 4-1 to allow AT&T to grow even bigger with this $39-billion takeover of T-Mobile. There was no investigation and no conditions imposed.”

Campbell said, “I cannot operate on blind faith. I voted no. Allowing AT&T to grow even larger when it has a terrible service record in Louisiana is a big mistake.”

He also expressed concern about the impact of the merger on jobs.

The Advocate’s writeup of Campbell’s tantrum has a little more…

“I hate to see something this big zooming through here without asking any questions,” said PSC Commissioner Foster Campbell, of Bossier Parish.

Campbell said 593 of the 639 complaints involving phone service that his office received during the past year were about AT&T.

“The service can’t get worse,” Campbell said.

Campbell was the sole vote against approving the merger. He asked his fellow commissioners to slow down and hold hearings and collect information and opinions. Obtaining written promises from AT&T to invest more in Louisiana is easier to get when the company wants something, Campbell said.

“It’s good common horse sense,” he said.

Notice how Campbell is now saying he wants to ask questions. Why? He’s already taken a position on the issue, and he’s already said he doesn’t know anything about this stuff. What’s the point of wasting the PSC’s time – not to mention that of the interested parties – with a full hearing for his benefit? If he needs an education certainly he’s got the contact information from AT&T or T-Mobile, or even the Sprint people who are lobbying against this merger (more on that in a second) – he can ask them questions with a reasonable certainty that somebody will give him information. They might even speak slowly, or write in small words so he can read them. What’s more, if you’ll notice in the minutes of the PSC’s meeting there’s a reference to the “Staff recommendation” – meaning that there was research done into the issue and a report prepared. You can actually read that for yourself, and we’ll get into it below.

As for these complaints Campbell has received, it seems a pretty disingenuous claim.

Think about it. First of all, you don’t complain to the PSC about your phone service if it’s a wireless phone you’re complaining about, because as Field notes they don’t regulate the service but only the terms and conditions of your plan. If it’s a land line, you might complain. And second, most folks wouldn’t bother to complain to the government if they don’t like their phone service; they’ll just change to another provider.

For example, here at Castle MacAoidh I have a land line through Cox as part of that bundle thing they do. I never use it and it’s hooked up to a fax machine I haven’t sent or received anything on in weeks, but I have it. But if I should decide I’m not happy with the service, I’ll just call AT&T and get a line in here. I’m not going to call Jimmy Field’s office and make a stink; what’s the point? Firing Cox and hiring a new provider goes a lot further in fixing my problem.

The only folks who can’t do that are folks who live out in the sticks and don’t have access to multiple land-line providers. And guess who’s the only company in the game for the vast majority of them? If you said AT&T, you get the gold star. There are some smaller rural telecoms who service the country folks in Campbell’s district – some of whom are pretty chummy with the Commissioner, as it turns out – but AT&T is the overwhelming provider. And if you’re the only phone company, it’s you that the complainers are going to complain about.

And 593 complaints in a year from a district with a population of over 700,000 or so really doesn’t sound like a whole lot. That comes to about 50 a month, or two a day on weekdays. Big freakin’ deal.

Most obnoxious, though, is Campbell’s openly suggesting that the PSC subject AT&T to regulatory harrassment so as to leverage more money out of them. If that doesn’t just scream Latin America to you, you’re not paying attention.

The one point Campbell’s been making about all this which might have some validity to it – and of course this, again, doesn’t involve the PSC’s mission – is that AT&T’s wireless network in Louisiana stinks. Well, let’s go look at some maps.

First, this is Verizon’s Louisiana map…

And this is AT&T…

You can see that Verizon’s coverage is a bit better than AT&T’s is, and as such (as we explained in our previous piece on this issue) AT&T wants to make an investment in improving its network so as to compete with Verizon – and AT&T says the merger with T-Mobile is part of that.

Meanwhile, this is Sprint’s map…

Sprint is all over the country lobbying against AT&T’s merger, and they were on hand at the PSC meeting last week. As the Advocate reported…

“The resulting market dominance would dwarf Sprint and the remaining carriers,” said William R. Atkinson, senior counsel for regulatory affairs, for Sprint Nextel, which would be the third largest.

Atkinson asked PSC members not to approve the merger.

As it turns out, Sprint has zero plans to upgrade its network in Louisiana. Prior to last week’s PSC meeting, the Commission’s staff put out a memo analyzing the pleadings in advance which didn’t favor Sprint’s position at all – it basically found all their claims to be groundless.

Campbell repeated those claims, as it happens. Particularly the one about how the AT&T merger would kill jobs – it’s hard to see how that would be the case if the company makes its planned investment to expand the wireless network in Louisiana, but that’s what Sprint claimed and Campbell repeated the claim after the fact. It’s almost like he didn’t read the staff memo; or maybe he did and didn’t like the conclusions in it so he pretended it didn’t exist.

Which is what you might do if you’re trying to cast yourself as Joe Six-Pack who’s just looking out for other Joe Six-Packs in taking an axe to those city slicker fellers in their fancy Eye-talian suits. It’s not what you do when you’re actually serious about doing your job.

Is it a little worrisome that the wireless market might be consolidating into a Verizon-vs.-AT&T competition? Probably. But you can look at those maps above and recognize that if the other guys aren’t making the investment to give you wireless coverage, then they’re not serious about competing in the marketplace. And if regulators protect the folks who aren’t serious about competing from the folks who are, they’re not serving the marketplace.

You know what the marketplace does to you when you don’t serve it properly? It takes an axe to you – or at least it does if you’re a private-sector player and you can’t get a politician/regulator to help you out.

Everybody hates a monopoly or an oligopoly, though ironically enough the whole purpose of the PSC isn’t to stop the creation of those but to keep them from screwing their customers once they already exist. And the deal which often gets cut is the regulators stand in the way of innovation (read: competition from new players in the market) in return for making utilities and other service providers genuflect to them before making changes to their prices.

After all, by the time Verizon and AT&T are finished building out these wireless networks and capturing 100 percent of the cellular service market there is absolutely no guarantee that somebody won’t have come along with a next-generation telecom technology that makes what they’re currently working on obsolete. At one point people were decrying the dominant market share Blockbuster Video had in the home video market – how’s that working for them now?

You could make the argument that what’s going on here is that Sprint, whose network in Louisiana generally stinks compared to the two big dogs in the market now and will get even worse by comparison if AT&T makes its move, is trying to stop the merger so it doesn’t have to upgrade its network. That’s not a hard conclusion to come to when you look at this thing. And you could ask the question whether Campbell isn’t carrying Sprint’s water here.

There’s no immediate paper trail leading from Sprint to Campbell. In fact, his most recent campaign filing, which still lists a run for his PSC seat as his target, contains a $2,000 contribution from AT&T last year. If he got cash from Sprint employees, or if he picked up money from Sprint earlier this year that hasn’t made it to his latest disclosure form – and Campbell didn’t put one out last week like most of the rest of the declared candidates in the state did – we haven’t been able to document it.

So we’re not alleging Campbell is crooked, or bought or anything. We’re wondering if there’s a Sprint connection, but it doesn’t really matter. Campbell’s campaign filing says he uses Verizon for his cell phone. Seriously, it does. We got a kick out of that.

What we are alleging is that he’s using this case, in which his position holds zero water regardless of whether you think AT&T is a good company or provides good service, to generate headlines and posture himself as a fighter for the common man. It’s old-line Longite populism, and in the bad old days it would have carried the day.

But in 2011 it gets blown out on a 4-1 vote. Even Lambert Bossiere, who’s a Democrat from New Orleans, took a look at this thing and realized Campbell was all wet.

That’s progress, and it gives us hope. We’ll have even more hope when Campbell isn’t in an elected position to make Louisiana look like a bunch of cutthroats and morons.



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