Labor and the AT&T-DirecTV Merger

By SETH SANDRONSKY

Under monopoly capitalism, big firms get bigger to rule markets. We turn to the proposal of AT&T, the large wireless provider, to spend $48.5 billion to buy DirecTV, a major satellite broadcaster, a sum roughly half of the general-fund budget for the state of California now. What does this proposed communications merger mean for employees at both companies? Jeff Kagan is an industry analyst.

“It’s too early to say at this stage,” he said in an email. “There are many reasons AT&T wants to acquire DirecTV. One of them is simply to grow to keep investors happy.” Happiness for investors is clear. Their investment grows when market share and profits rise.

“Another is to become more competitive with more services on a national rather than regional scale,” according to Kagan. “I see DirecTV continuing to offer traditional satellite television services to customers, and I also expect to see AT&T work to blend it into their larger bundle of services for customers, nationwide.”

A radical writer sees a broader issues at play in the economy.

In The Theory of Monopoly Capitalism: An Elaboration of Marxian Political Economy (Monthly Review Press, 2014), John Bellamy Foster critiques the global system’s trend to concentrate and centralize capital that in part destroys paid work. This in turn weakens demand. The proposed AT&T merger with DirecTV comes on the heels of a proposal for Comcast to acquire Time Warner Cable. The merger could if it goes forward result in an unprecedented Internet and television monopoly of the number one and two telecommunications firms. Meanwhile, Kagan does not see layoffs, at least at DirecTV.

“I don’t see DirecTV workers losing their jobs,” he said. “I think AT&T and DirecTV are two different businesses and because of that DirecTV workers will be needed.”

We turn to a view of what awaits employees for AT&T and DirecTV.

“This compelling and complementary combination will bring significant benefits to all consumers, shareholders and DIRECTV employees,” said Mike White, president and CEO of DirecTV in a May 18 statement. “US consumers will have access to a more competitive bundle; shareholders will benefit from the enhanced value of the combined company; and employees will have the advantage of being part of a stronger, more competitive company, well positioned to meet the evolving video and broadband needs of the 21st century marketplace.”

Asked to comment on the proposed merger’s impact on workers at both companies Mark Siegel, the executive director of the company’s media relations, steered a reporter to the May 18 news release above.

A statement from the head of Time Warner Cable about the proposed merger with Comcast reads a bit like that of his counterpart at DirecTV. “This combination creates a company that delivers maximum value for our shareholders, enormous opportunities for our employees and a superior experience for our customers,” said Robert D. Marcus, Chairman and CEO of Time Warner Cable. Kim Hart is press secretary for the Federal Communications Commission. The FCC regulates interstate and international communications by radio, television, wire, satellite and cable. Hart declined to reply to an interview request on what AT&T’s proposed purchase of DirecTV might mean for both companies’ employees.

In response to an email query on the impact of the proposed merger of AT&T and DirecTV on their respective work forces, the US Department of Justice, like the FCC, had an allergy to a reporter’s interview query.

The Communications Workers of America, AFL-CIO, represents more than 700,000 men and women around the US, Canada and Puerto Rico. CWA’s May 19 statement on AT&T’s plan to buy DirecTV is instructive.

“CWA is optimistic that this deal will improve services and make even more content available for millions of customers. We also believe that it will provide better employment opportunities for tens of thousands of employees at both companies. We look forward to learning more about the details in the days ahead. AT&T’s commitment to provide high speed Internet services to 15 million non-urban locations is a positive move toward expanding Internet access and availability to more Americans.”

Sandy Rusher is CWA’s organizing director. He declined to answer a request for comment on the commitment of AT&T to CWA to extend or live up to the terms of its wireless card check and neutrality agreement as organizing ground rules for employees soon to be added to its workforce as part of this new “line of business.”

Craig Aaron heads Free Press, a nonpartisan group that advocates for “universal and affordable Internet access, diverse media ownership, vibrant public media and quality journalism.” A close look at the filings of AT&T and DirecTV is necessary to grasp the relevant details involved, according to him.

“But I have yet to see a merger that created more jobs,” Aaron said via email. “Big companies merge to cut suddenly “redundant” positions … so if you work at a call center or as an installer for one of these companies, especially DirecTV, then you have good reason to be worried about the outcome of this deal. Same if you are in middle management.”

Perhaps workers who lose their jobs in such mega-mergers of telecommunications firms will have more time to view cable television. That is, of course, as long as their unemployment insurance can pay the subscription costs.

Seth Sandronsky is a Sacramento journalist and member of the freelancers unit of the Pacific Media Workers Guild, which is a local office of The Newspaper Guild, which is part of Communications Workers of America.

From The Progressive Populist, July 1-15, 2014