Hawaii, Massachusetts, Minnesota, and Nevada join lawsuit, growing coalition to 14 attorneys general

June 24, 2019 - SACRAMENTO – California Attorney General Xavier Becerra last week welcomed four additional states to the lawsuit challenging the merger of telecommunications companies T-Mobile and Sprint. The companies – two of only four national wireless providers – offer wireless phone services to over 13 million California consumers. The lawsuit challenges the acquisition of Sprint by T-Mobile because it would lead to higher prices and fewer choices for consumers, particularly low-income subscribers of the companies’ services.

“California consumers can’t afford higher prices and fewer choices,” said Attorney General Becerra. “My office is committed to protecting Californians and meaningful competition in our markets. We’ll do everything necessary to block unlawful mergers, including filing a preliminary injunction, if necessary, as part of our litigation.” 

The current market includes four national network providers: T-Mobile, Sprint, Verizon and AT&T. Sprint and T-Mobile’s proposed union would consolidate these four provider options into three, by combining T-Mobile and Sprint’s market shares. In certain areas of California, the market share of the merged firm would be over 50 percent. Moreover, Sprint and T-Mobile have high market shares among low-income populations. They would become the dominant network provider for prepaid mobile services, which are available without a credit check. Any merger would significantly hurt these communities by diminishing competition and increasing costs to consumers.

This is T-Mobile’s third merger attempt. Each previous attempt has been blocked or abandoned due to opposition from the government based on the same concerns laid out in the lawsuit filed today. In this attempt, T-Mobile and Sprint argue that the merger would allow them to more quickly roll out a next-generation 5G network and more broadly increase service to rural customers. However the companies are already planning to roll out 5G networks, and T-Mobile is already planning increased rural coverage, even without the merger.

A copy of the amended complaint can be found here.
Source: CA. DOJ