It is hard to avoid becoming cynical when watching the federal government interact with big corporations like AT&T. So when AT&T announced it would merge with T-Mobile, giving AT&T and Verizon a combined 3 out of 4 cellular subscribers, I thought two things:

1) What a terrible idea. Higher prices, fewer jobs, less choices, etc.

2) The Federal Government will likely not prevent it - instead opting for some minor concessions that no one will bother to enforce.

Sometimes, it is very good to be wrong.

Cecilia Kang of the Washington Post, decodes the language from Wall Street to explain the biggest winner from the federal government blocking the merger: consumers.

“Without the combination, we think the wireless industry will be further weakened by continued hypercompetitive activity, particularly regarding subscriber acquisition costs,” said Nomura Securities analyst Mike McCormack.

That means customers can still get lower rates as the industry competes for their dollars. T-Mobile, for example, will continue to be a low-cost competitor, according to consumer advocacy group Consumers Union. A survey showed that data plans from T-Mobile were $15 to $50 less per month than those offered by AT&T.

An excellent reminder that what is best for Wall Street is not what is best for the 99%. Big companies like AT&T find competing for customers a hassle that lowers their profits -- they consider a market with four sellers to be hypercompetitive. In wireline, they have acquiesced to the "competition" of two competitors -- cable and DSL.

This is one reason communities build their own networks -- the private sector is not truly competitive when it comes to ISPs and most communities have no prospect real of improvement absent a public investment.

But we should rejoice in this victory -- because we earned it. Without the hard work of many grassroots groups, it is hard to imagine the Department of Justice or FCC standing up to such a powerful corporation.

Some quotes from some of the many organizations responsible for protecting the 99% of us who don't benefit from higher prices and fewer choices.

Andrea Quijada of the Media Literacy Project:

“The end of AT&T’s campaign to eliminate mobile competition and jobs is a gift to working class New Mexican families this holiday season. However, we know that this decision was not the result of AT&T putting people before profit. This result was won by media justice advocates and our allies in New Mexico and nationwide. Though we are certain this is not the last we’ve heard from AT&T/T-Mobile, we want to take a moment to acknowledge this victory for consumers.

The National Hispanic Media Coalition spoke out against the merger and celebrated its demise:

"AT&T has finally accepted that its bid for T-Mobile has run its course. NHMC is very pleased that the FCC and the DOJ have so justly put the little guys ahead of giant corporations in their review of this merger. Latinos pay more for cell phone service than any other ethnic or racial group, paying the most on AT&T and the least on T-Mobile. In addition, because T-Mobile's workforce is nearly 50% people of color, and an estimated 20,000 T-Mobile employees would have lost their jobs as a result of this merger, Latinos and other people of color would have been disproportionately harmed. For these reasons, NHMC has worked hard over the past seven months to educate people about the harms of merger. We are ecstatic to have defeated it," comments Jessica González, NHMC's Vice President of Legal and Policy Affairs.

The Center for Media Justice issued these comments:

amalia deloney, Media Policy Field Director of Center for Media Justice stated, “Since AT&T first announced its intent to takeover T-Mobile, the Center for Media Justice has continuously raised concerns about what role a duopoly would mean for historically marginalized communities— particularly communities of color and America’s poor who disproportionately rely on access to mobile broadband to find employment, access healthcare, advance their education and organize for social and economic justice.”

This holiday season, millions of folks across the country will not be blind-sided by high phone bills, and T-Mobile employees – many of whom are people of color and all of whom are nonunion- will get to keep their jobs. Today marks an important victory for rural and poor communities, people of color, and the hard workers of America who simply can’t afford to pad the pockets of the corporate CEOs.

And finally, the Media Acess Project:

Today’s announcement proves that law trumps politics. This anti-competitive transaction clearly exceeded permissible standards. AT&T and T-Mobile thought they could push it through by using lobbyists and political pressure, but the FCC and Department of Justice held firm.

If you aren't familiar with SOPA - the "Stop Online Piracy Act" or its companion in the Senate (called PIPA or Protect IP), you should be. This is legislation that would allow the US government to require Internet Service Providers block web sites without due process. Sascha Meinrath and James Losey from the New America Foundation explain the threat in Slate:

The interconnected nature of the Internet fostered the growth of online communities such as Tumblr, Twitter, and Facebook. These sites host our humdrum daily interactions and serve as a public soapbox for our political voice. Both the PROTECT IP Act and SOPA would create a national firewall by censoring the domain names of websites accused of hosting infringing copyrighted materials. This legislation would enable law enforcement to take down the entire tumblr.com domain due to something posted on a single blog. Yes, an entire, largely innocent online community could be punished for the actions of a tiny minority.

If you think this scenario is unlikely, consider what happened to Mooo.com earlier this year. Back in February, the Department of Justice and Department of Homeland Security seized 10 domains during a child-porn crackdown called “Operation Protect Our Children.” Along with this group of offenders, 84,000 more entirely innocent sites were tagged with the following accusatory splash page: “Advertisement, distribution, transportation, receipt, and possession of child pornography constitute federal crimes that carry penalties for first time offenders of up to 30 years in federal prison, a $250,000 fine, forfeiture and restitution." Their only crime was guilt by association: They were all using the Mooo.com domain.

From our point of view, what is most interesting is not who is pushing this bill (Hollywood and the usual suspects that tried to kill the VCR because it would obviously destroy the movie industry) but who is not resisting. After all, whenever the issue of network neutrality comes up, the big telecom companies pay a bunch of organizations like Americans for Prosperity to create astroturf movements to oppose a "government takeover of the Internet." Of course, network neutrality is the opposite - a set of rules where the government requires corporations not dictate how subscribers use the Internet.

But here we have a literal government takeover of the Internet. Should SOPA pass, the federal government would decide what sites are allowed to be accessed by Americans and which cannot. The evidence thus far suggests that more sites will be harmed by incompetence as opposed to intentional political censorship but the entire approach is troubling, to say the least.

To get a sense of which elected officials are supporting this legislation, here are the cosponsors for HR 3261 in the House and cosposors for S 968 in the Senate. More details on how you can be involved at Demand Progress.

Many of the organizations who have strongly fought for an open Internet with strong network neutrality rules are pouring resources into stopping SOPA. This includes Free Press's Save the Internet, Public Knowledge, and others. Some of the network neutrality opponents, like the Wall Street Journal and Cato Institute have also warned against SOPA but other groups -- like Americans for Prosperity have been fairly silent. The next time AT&T and Time Warner Cable-sponsored groups start fear-mongering around policies that threaten to bring competition against their corporate sponsors, we must ask them where they were when the future of the Internet was truly threatened.

The Future of Music organization has reviewed an alternative to SOPA that may be a much better approach.

Below is a video about SOPA.

Image credit: monkeyc on Flickr.

CNN Money has profiled 7 government-backed inventions.  Most of us know the Internet would not have been possible without the research and development funded by tax dollars, but fewer know that the GPS and microchip were also created as a direct result of "big government."

Beyond those inventions, I was suprised to find that aerodynamic trucks (tractor trailers on the highway) were designed by NASA.  Bar codes -- imagine modern commerce with the ubiquitous bar code -- were developed with funding from the National Science Foundation.  

As a nation, we greatly appreciate the innovation that comes from the private sector (especially you Apple fan-boys) but it is beyond time we recognize the role of the public sector in innovation as well.  Heck, just how much innovation would we see on farms if they were still only connected with dirt roads??  How much more will we see when they are all connected with fast, affordable, and reliable connections to the Internet?  

An excellent satirical look at those who believe government is the root of all problems. Modern society has many problems that cannot be solved by individuals acting autonomously -- we need to work together to solve them.  "Government" is one of the key entities we use to work together to solve problems. 

Video: