Lawyers Enlist AT&T Customers to Murder the Merger

Opponents of the pending US$39 billion merger between wireless carriers AT&T and T-Mobile are taking legal action with New York-based law firm Bursor & Fisher in a bid to block the deal.

Eleven arbitration cases have been filed on behalf of AT&T customers, and the law firm hopes more angry consumers will jump on board with its “Fight the Merger” initiative, which invites anti-merger consumers to join the fight against what critics say would be a duopoly should the companies be allowed to consummate the deal.

“AT&T’s $39 billion takeover of T-Mobile would turn back the clock to the era of the Ma Bell monopoly,” reads a description on Bursor & Fisher’s Fight the Merger website.

The pending merger, which was announced in March but is still in the discussion phase while it awaits negotiations and approval, has received harsh criticism from opponents. Consumer advocacy groups and wireless providers, most notably Sprint, have warned the arrangement would lead to higher prices, poor service and an overall stifling of competition.

AT&T, of course, sees the merger in a different light. In its filing with the FCC that introduces the acquisition plans, the company argues that it faces network and capacity constraints and the acquisition would lead to more complete coverage.

Smaller wireless providers, communication advocacy groups and tech giants Microsoft and Facebook came out in public support of the merger. The move surprised some at first glance, but the companies argued alongside AT&T that fuller, uninterrupted coverage really would lead to greater innovation for engineers, developers and adapters of their app-heavy devices and business models.

Consumer Day in Court

AT&T declined further comment to the E-Commerce Times, and it did not respond publicly to the Fight the Merger initiative. However the carrier has said before the arbitration cases won’t have the authority to block the merger as it goes forward.

Should consumers jump on board with Fight the Merger anyway, each of their arbitration cases via the Clayton Antitrust Act will have to be filed individually, since the AT&T contract prohibits users from raising a class-action suit against the company.

A provision in the Antitrust Act forbids mergers that “may substantially lessen competition or tend to create a monopoly,” though in reality it’s not always that cut and dry.

“The difficulty is that the interpretations of the statute by the courts have tended to require very specific proof that competition in a geographic area is eliminated,” Peter Carstensen, professor of law at the University of Wisconsin in Madison and an antitrust expert, told the E-Commerce Times.

With the widespread use of cellphones and the availability of local providers, it will be difficult to decide who gets their day in court. In addition, as with most lawsuits in the tech sector, rapidly changing environments and a lack of precedents make cases even more difficult to arbitrate.

Not Worth Fighting Now?

With the difficulty in determining arbitration, questions have been raised as to whether it’s even worth launching a legal campaign now, especially since the details of the merger haven’t come through yet. In one way or another, before the deal is finalized, the government will step in to determine whether the acquisition is acceptable.

“I think the bottom line is that in the end, the government is going to require AT&T to make certain concessions, maybe giving away territories, some oversight, or it could be a lot of different things which would be essentially consumer protections,” Joe Bonner, analyst at Argus Research, told the E-Commerce Times.

It could be considered a waste of resources to bring a legal fight forward before customers are certain this is an anti-consumer deal. Until a more clear set of parameters and concessions are known, it may be a non-issue.

“The fact that I’m not paying attention to it, of all the 900 things I think about, means it’s just not on my radar screen,” Peter Rhamey, analyst at BMO Capital Markets told the E-Commerce Times.

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Intuit’s $12B Mailchimp Purchase Breathes New Life Into Email Marketing

Intuit on Monday announced an agreement to acquire Mailchimp, a global customer engagement and marketing platform for small and mid-market businesses, for $12 billion in cash and stock advances. The purchase could be the linchpin that thrusts the mostly financial software company into solving more fertile mid-market business challenges for its customers.

The planned acquisition is part of Intuit’s mission to become an AI-driven expert platform. With the acquisition of Mailchimp, Intuit will accelerate two of its previously-shared strategic big bets: to become the center of small business growth and to disrupt the small business mid-market, said the company in its announcement.

Intuit’s acquisition of Mailchimp sends a great message to all entrepreneurs around the globe that venture capital is not always necessary, observed Michael Kawula, co-founder of CBA, a marketing agency for YouTube monetization. Mailchimp is a bootstrapped success story that has not raised any outside venture capital.

“This is a very clever growth strategy for Intuit, who wants to get in front of SMBs, which is difficult and expensive. Similar to HubSpot’s recent purchase of The Hustle newsletter, a much smaller acquisition, this also is brilliant,” he told the E-Commerce Times.

The acquisition marks a significant impact in industry, according to Osiris Parikh, sales marketing manager at Lilius. He also sees the deal as another reminder that email marketing is not dead — and data is power.

“Intuit has made a strong move to broaden its portfolio and become a leader in catering to the needs of SMBs. It is also a great story of success during Covid-19,” he told the E-Commerce Times.

Deal Basics

Intuit provides a global technology platform that makes TurboTax, QuickBooks, Mint, and Credit Karma. Intuit and Mailchimp will offer an innovative, end-to-end customer growth platform that allows customers to get their business online. It will also enable them to manage marketing, customer relationships, payment processes, and access insights and analytics, along with optimizing their cash flow and staying compliant with experts at their fingertips, according to Intuit.

Key to this process is Intuit’s ability to enable businesses to combine their customer data from Mailchimp and QuickBooks’ purchase data to get the actionable insights they need to grow and run their businesses with confidence.

“We’re focused on powering prosperity around the world for consumers and small businesses. Together, Mailchimp and QuickBooks will help solve small and mid-market businesses’ biggest barriers to growth, getting and retaining customers,” said Sasan Goodarzi, CEO of Intuit.

Mailchimp brings to Intuit technology at scale along with global customer reach.

Founded in Atlanta, in 2001, Mailchimp began by offering email marketing solutions. The company evolved into offering customer engagement and marketing automation processes fueled by an AI-driven technology stack. Mailchimp’s data and technology spans 70 billion contacts and more than 250 rich partner integrations. Its AI-powered automation at scale fuels 2.2 million daily predictions.

“Over the past two decades, we have vastly expanded and evolved Mailchimp’s platform to help millions of small businesses around the world start and grow,” said Ben Chestnut, CEO and co-founder of Mailchimp.

Why Mailchimp’s Worth It

While the email marketing sector is pretty crowded, Mailchimp stands out in terms of size and scope. The company reportedly has 13 million total global users, 2.4 million active monthly users, and 800,000 paid customers, noted Charles King, principal analyst at Pund-IT.

“Plus, half of its customers are outside of the U.S. Additionally, while people tend to focus on the mass/might of large enterprises, small businesses are really the heart and soul of most economies,” he told the E-Commerce Times.

The acquisition likely represents a lucrative opportunity for Intuit to integrate Mailchimp data with QuickBooks and provide greater analytical capabilities to customers. The synthesis of financial and marketing data in this case provides valuable and actionable insights about an organization’s clients, added Lilus’ Parikh.

“It’s also a great diversification of offerings to centralize SMB operations through one platform and benefit from Mailchimp’s established user base,” he said.

Another supporting factor for Intuit’s interest in Mailchimp is the renewed stature of email, according to Elice Max, co-owner of EMUCoupon and someone who has been involved in online marketing for eight years.

“Email marketing has made a comeback in recent years. With increased digitization caused by the pandemic, all digital mediums including email have gained a renewed importance,” she told the E-Commerce Times.

Email Marketing’s Resurgence

Technology giants are looking to build more integrated and holistic solutions. Microsoft recently bought Clipchamp, a video production tool. Both companies are looking to build platforms for the new tech-savvy SMBs, Max Suggested.

“More than anything, it means a renewed confidence in the field. Experts have been talking about the death of email marketing for a while now. But a $12 billion acquisition by a big player like Intuit means email promotion is alive and kicking,” she said.

Another factor is Intuit keeping its eye on the ball. It is important to remember the significance of Mailchimp as the pioneer in marketing automation and email marketing in particular.

“Intuit is looking to make a statement that it wants to become more than a financial software company,” Max observed.

QuickBooks Synergies

One of the motivations that lies behind Intuit’s purchase of Mailchimp is its desire to lead a revolution in the CRM capabilities of SMBs, according to Will Ward, CEO of Translation Equipment HQ . Think about the effect the pandemic has had on the popularity of remote work and the amount of remote SMBs being established.

“You would expect there to be a lot of growth potential here in the next few years. With Mailchimp and QuickBooks, Intuit is providing an end-to-end customer growth platform, and with around $20 billion invested already its belief in SMBs is evident,” Ward told the E-Commerce Times.

Like any other system that handles transactions such as orders and payments, you need to work closer to the actual customer channels. With the Intuit e-commerce product, launched about a year ago, this seems like a natural step by adding marketing automation and reaching out with its e-commerce offering to the MailChimp customer base, suggested Johan Liljeros, general manager and senior commerce advisor, North America for Avensia.

“The acquisition has added synergies between the platforms while still being able to operate as independent platforms. Looking at Intuit’s offerings, it appears they are moving towards expanding [into] digital transactional experience,” he told the E-Commerce Times.

Final Thoughts

Email marketers should be ready for disruption along with other business services providers. Intuit has been both savvy and aggressive in the way it built its business, effectively becoming the 800-pound gorilla of small business accounting and tax solutions, according to Pund-IT’s King.

“With that kind of ally behind Mailchimp, life is going to become a whole lot more ‘interesting’ for other email marketers,” he predicted.

The Intuit-Mailchimp deal should offer Intuit customers significant benefits, such as new solutions and services for bolstering their businesses. At the same time, the deal highlights the fact that old technologies can continue to be vital and dynamic.

“For years, many have claimed that email is dead or dying and quickly being replaced by whatever the tech du jour happens to be. Mailchimp — and now Intuit — beg to differ,” King quipped.

Jack M. Germain has been an ECT News Network reporter since 2003. His main areas of focus are enterprise IT, Linux and open-source technologies. He is an esteemed reviewer of Linux distros and other open-source software. In addition, Jack extensively covers business technology and privacy issues, as well as developments in e-commerce and consumer electronics. Email Jack.

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