Leads coalition opposing the merger, which would lead to reduced competition and higher prices

July 28, 2019 - SACRAMENTO – California Attorney General Xavier Becerra, leading a coalition of 14 attorneys general from across the nation, on Friday expressed concern about a newly announced deal — approved, in principle, by the United States Department of Justice (U.S. DOJ) — supporting the proposed megamerger between telecommunications giants T-Mobile US Inc. and Sprint Corporation.

“Here in California and across our coalition of states, our concerns with this merger have been, are, and continue to be about the harms posed by over-consolidation and diminished market competition,” said Attorney General Becerra. “A marketplace with fewer active competitors drives up costs, reduces consumer choice, and thwarts innovation. We intend to be prepared to go to trial to fight for a fair, competitive, and equitable marketplace for consumers nationwide.”

California Attorney General Xavier Becerra and New York Attorney General Leticia James led the filing of the complaint blocking the merger on June 11 in United States District Court for the Southern District of New York — alleging that the merger of two of the four national mobile network operators would harm mobile subscribers nationwide by reducing access to affordable, reliable wireless service, and that it would hit lower-income and minority communities particularly hard. The coalition today reaffirmed its commitment to opposing this merger, which would reduce competition and increase prices for consumers.

T-Mobile currently has more than 79 million subscribers, and is a majority-owned subsidiary of Deutsche Telekom AG. Sprint Corp. currently has more than 54 million subscriber, and is a majority-owned subsidiary of SoftBank Group Corp.

The U.S. DOJ indicated earlier today it would approve the merger of T-Mobile and Sprint based on promises made by the two companies, including an agreement to divest Sprint’s prepaid subscription service and potentially a slice of its wireless spectrum to satellite TV operator DISH. Though DISH has never owned any kind of mobile wireless business and has no experience building or operating a nationwide mobile wireless network, both T-Mobile and Sprint claim that this deal will create a fourth national network operator that will preserve a competitive market for consumers.

The states continue to have serious concerns with the merger and whether the deal with DISH would meaningfully address the loss of competition otherwise caused by this megamerger. Among those concerns:

• DISH has never shown any inclination or ability to build a nationwide mobile network on its own and has repeatedly broken assurances to the Federal Communications Commission about deployment of its spectrum;
• DISH does not have the network to operate as an independent competitor, like Sprint does today, and will, instead, remain reliant on the T-Mobile network for the foreseeable future; and
• T-Mobile and Sprint are asking Americans to trust that this new mega-corporation will act directly against its own economic interests by helping transform DISH into an independent competitor that rivals this new company.

The states remain committed to protecting competition in the marketplace and lower prices for consumers. In addition to Attorney General Becerra, the plaintiffs currently include New York, Colorado, Connecticut, the District of Columbia, Hawaii, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, Virginia, and Wisconsin.
Source: CA. DOJ, Photo credit: NIH

FCC Chairman Pai Statement On Justice Department’s Proposed Settlement Of T-Mobile/Sprint Merger

July 28, 2019 - WASHINGTON - The U.S. Department of Justice on Friday filed a proposed settlement in the U.S. District Court for the District of Columbia that, if approved by the court, would resolve the Department’s concerns about the purchase by T-Mobile US, Inc. of Sprint Corp. Federal Communications Commission Chairman Ajit Pai issued the following statement:

“I am pleased that the U.S. Department of Justice has reached a settlement with T-Mobile and Sprint. The commitments made to the FCC by T-Mobile and Sprint to deploy a 5G network that would cover 99% of the American people, along with the measures outlined in the Department’s consent decree, will advance U.S. leadership in 5G and protect competition. In addition, the transaction has garnered bipartisan support, including from Governor Laura Kelly (D-KS), Congresswoman Anna Eshoo (D-CA), and former FCC Commissioner Mignon Clyburn.

“Because of this transaction’s potential to help close the digital divide in rural America and maintain our nation’s leadership in 5G, as well as the commitments made by T-Mobile and Sprint to the FCC, I plan to present my colleagues soon with a draft order, consistent with the Department’s filings, favorably resolving the FCC’s review of the transaction.”
Source: FCC