The chairman, Julius Genachowski, made the move after the commission’s staff concluded that the deal would harm consumers, kill jobs and result in an overly concentrated wireless phone industry, F.C.C. officials said.
The decision puts another large roadblock in front of ATT, the nation’s second-largest wireless phone company, in its effort to buy T-Mobile, the fourth-largest carrier. In August, the Justice Department filed a federal antitrust lawsuit to block the merger, saying it would stifle competition.
Mr. Genachowski on Tuesday notified the other three F.C.C. commissioners that he intended to refer the proposed merger to an administrative law judge for a trial-like hearing in which ATT would be required to show that the deal was “in the public interest.” The commission — currently composed of three Democrats, including Mr. Genachowski, and one Republican — is likely to vote on the chairman’s plan in the next couple of weeks, an agency official said.
The merger is subject to F.C.C. approval because the joining of the two companies will require transfer of licenses to use public airwaves for cellphone signals and wireless Internet access. The judge will weigh the evidence and render a decision, which then will be reviewed by the F.C.C. for a final judgment.
A hearing before the administrative judge would not happen until after the antitrust trial, scheduled for February in United States District Court in Washington, is completed.
Larry Solomon, senior vice president for corporate communications at ATT, called the F.C.C.’s action “disappointing.”
“It is yet another example of a government agency acting to prevent billions in new investment and the creation of many thousands of new jobs at a time when the U.S. economy desperately needs both,” Mr. Solomon said in a statement. “At this time, we are reviewing all options.”
Consumer groups and ATT rivals, who have strongly opposed the merger, hailed Mr. Genachowski’s move. “As Chairman Genachowski said in August when the Justice Department filed its antitrust lawsuit against ATT, the record before the F.C.C. presented ‘serious concerns about the impact of the proposed transaction on competition,’ “ said Vonya McCann, senior vice president for government affairs at Sprint, the third-largest carrier, which has filed its own lawsuit seeking to block the merger. (Verizon is the largest carrier.)
ATT has sought to shift the focus of the public debate about the merger to jobs in recent months, casting the deal as crucial to meeting President Obama’s goal of expanding high-speed Internet.
“This merger is going to be a driver of innovation, it’s going to result in further investment in rural America and more jobs in rural America,” Robert Quinn, ATT’s senior vice president for federal regulatory and chief privacy officer, said in an interview earlier this month.
But the company has been carefully circumspect about providing details about how its direct employment in the wireless business will be affected by the merger. Asked by the F.C.C. last month for specifics on how many workers the combined company would employ, the company said that many jobs would be eliminated and offered a confidential estimate of “payroll and other job-related savings” whose language strongly implied the number would go down instead of up. That has left F.C.C. officials unimpressed. “The record clearly shows that, in no uncertain terms, this merger would result in a massive loss of U.S. jobs and investment,” said a senior F.C.C. official, who spoke on the condition of anonymity because of confidentiality agreements involving ATT’s estimates. The official declined to provide specific figures for jobs lost.
ATT struck back at that statement, noting that the F.C.C. said its own plan for a $4.5 billion annual investment to expand broadband in rural areas would create 500,000 jobs in six years.
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