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Expanding the network would be free
Expanding the network would be free

The claim: AT&T also stretched the truth about many smaller points. One of note: The company said its merger with T-Mobile would allow the combined company to make its network more efficient and expand capacity at no additional cost.

Another notable claim: AT&T said its data shows that 40% of customers that cancel service due to higher prices will not purchase another cell phone. AT&T said that means the combined company is unlikely to raise prices for fear of losing customers permanently.

The response: The FCC had trouble believing either claim, arguing that AT&T is purposefully inflating statistics to make the proposed merger appear better than it actually would be.

For the network efficiency argument, the regulator said that AT&T neglected to include the costs of integrating the two networks and phones in its cost assessment. That ommission made AT&T's claims of the merger's cost-saving benefits appear far greater than they actually would be.

As for the claim that droves of customers would drop their service and never buy a cell phone again if AT&T raised prices, the FCC called it both "implausible" and "unsupported." AT&T derived that number from its own studies of customers that leave its network, but the FCC said the company's choice in parameters for its calculation were unreasonable.

By David Goldman @CNNMoneyTech - Last updated December 01 2011: 6:07 AM ET
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The Federal Communications Commission on Tuesday blasted AT&T, accusing the telecom giant of lying about the benefits of its proposed merger with T-Mobile.