Current Events > FCC Chairman Endorses T-Mobile Merger With Sprint

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https://www.npr.org/2019/05/20/725038799/fcc-chairman-endorses-t-mobile-merger-with-sprint

A telecom merger that has been years in the making is poised to clear a major regulatory hurdle.

Ajit Pai, the Federal Communications Commission chairman, said Monday that he endorses the merger of T-Mobile and Sprint, a $26 billion deal. This came after the companies agreed to various concessions, including a pledge to not raise prices for three years.

"I believe that this transaction is in the public interest and intend to recommend to my colleagues that the FCC approve it," Pai stated. "This is a unique opportunity to speed up the deployment of 5G throughout the United States and bring much faster mobile broadband to rural Americans. We should seize this opportunity."

As NPR's Alina Selyukh reported, "the full FCC is likely to soon approve the deal, while the Justice Department finishes its own review." The Justice Department is specifically looking at antitrust concerns.

If approved, it would reduce the number of major U.S. wireless telecom carriers from four to three. The merger would combine third-largest T-Mobile with fourth-largest Sprint in competition with the two biggest providers, Verizon and AT&T.

Pai said discussions with the companies resulted in specific commitments to improve 5G networks and if they do not live up to these commitments, they could be fined billions of dollars.

The companies have agreed to deploy a 5G network that would cover 97% of the U.S. population within three years, and 99% within six years. The 5G network would cover 85% of rural Americans within three years and 90% within six years, the companies said.

Under the terms of the agreement, the companies also committed to not raise their rates for three years after the merger.

And the companies said they will sell the prepaid brand Boost Mobile. According to terms of the deal, this is intended to "remove any remaining doubts regarding the impact of the merger on prepaid wireless customers and competition," nodding to concerns about the effect on lower-income Americans. The companies will continue to own two other prepaid brands, Virgin Mobile and Metro.

"The New T-Mobile will be a disruptive rival with the resources to go toe-to-toe with established behemoths to drive competition and innovation that benefits everyone, everywhere," T-Mobile U.S. CEO John Legere said in a statement. T-Mobile is controlled by Deutsche Telekom, and Sprint is primarily owned by Japan's SoftBank.

"We've seen this kind of consolidation in airlines and with drug companies," said FCC Commissioner Jessica Rosenworcel, who is a Democrat. "But now the @FCC wants to bless the same kind of consolidation for wireless carriers. I have serious doubts."

Gigi Sohn, a public interest lawyer who worked as a counselor to former FCC Chairman Tom Wheeler under President Obama, said the deal is "still anticompetitive and anti-consumer." Wheeler has previous warned that such a deal would cause prices to rise.

"Does anyone really believe that this FCC, which has asked nothing of the big mobile companies for over 2 years will require the companies to abide by these commitments? ...The handful of unenforceable promises made by the merging companies does no more than put lipstick on a pig," Sohn said in a statement. "The DoJ and the FCC should block it."

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Not everyone agrees on how it will impact consumers. "I don't think it will make a significant difference in prices going forward," Roger Entner, the founder of telecom insight firm Recon Analytics, told NPR. "It helps them to roll out faster. ...T-Mobile has dominated the wireless industry for the last four years and grown faster than everybody else combined. And this just will strengthen that trend."

He said the timing of Pai's blessing the merger is likely linked to new U.S. restrictions on Chinese tech giant Huawei.

"Huawei is a significant provider for rural broadband telecom companies. Like a quarter of small remaining broadband providers use Huawei equipment," he said. "By endorsing the T-Mobile deal, and T-Mobile's commitment to rural broadband, you're creating another competitor there where there is none today."

Entner added that this deal is likely to put intense pressure on those small rural carriers. "I would expect quite a few small rural telecos to go out of business or sell because the magenta giant comes in and rolls over them. ... It's like Wal-Mart coming to a mom and pop shop, to a small town in Kansas."

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3 years till they screw over everyone?
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How has Ajit Pai not been impeached yet
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Just business as usual under Ajit Pai
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Weird a former Telecom lackey is all for telecoms to come back together. Weird
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Actually I think this is good. This is like, poetic justice after Verizon and AT&T, in cooperation with Qualcomm deliberately went out of their way to fuck over those two companies. I hope it passes.
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Agreeing to not raise prices for three years...lmao. They already charge an arm and a leg...they should not need to increase prices, like, ever in our lifetimes.
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2 bad providers merging lmao
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LightHawKnight posted...

3 years till they screw over everyone?

this

what a weak-ass concession
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khajiit pai has internet if you has coin
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I'm guess the only people who hate this are those with stock in AT&T or Verizon, and are afraid that the new merger would threaten your position.

HiddenRoar posted...

I'm guess the only people who hate this are those with stock in AT&T or Verizon, and are afraid that the new merger would threaten your position.

hurrrr

A shit pie.
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or maybe its a really shitty merge of 2 shitty companies
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Bluebomber182 posted...

or maybe its a really shitty merge of 2 shitty companies

Which shouldn't affect you.

Presumably because you aren't a member of either, considering how lowly you think of their service. Perhaps merging would make them less shitty, as it's unlikely that they would, individually, have the resources to compete against the top two.

Korea's mobile phone industry is significantly ahead than the U.S.'s, and gasp, they only have major 3 providers.

It's either merge or Sprint dies.

From what I've read from people on the T-Mobile sub-reddit (not everyone supports it), Sprint is kind of on life-support. T-Mobile is the only one who wants to take it over because of a bunch of unused spectrum (I think that's what it is. It's something to do with that though).

Also T-Mobile has gotten much better and I don't pay AT&T/Verizon prices, so.....
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HiddenRoar posted...

Korea's mobile phone industry is significantly ahead than the U.S.'s, and gasp, they only have major 3 providers.

they also have regulatory bodies that aren't total shitshows

Also AT&T/Verizon have like 60-70% of the market currently. T-Mobile/Sprint COMBINED don't equal AT&T OR Verizon in market share.

https://www.statista.com/statistics/199359/market-share-of-wireless-carriers-in-the-us-by-subscriptions/
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treewojima posted...

they also have regulatory bodies that aren't total s***shows

Are you sure about that.
lol.

ToadallyAwesome posted...

Weird a former Telecom lackey is all for telecoms to come back together. Weird

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untrustful posted...

What a punchable face
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HiddenRoar posted...

treewojima posted...

they also have regulatory bodies that aren't total s***shows

Are you sure about that.
lol.

yes. for starters, they actually have healthy competition among Internet service providers, coupled with subsidies that incentivize said providers to treat network traffic as equally as possible. in other words, they took the free market approach and made it work for everyone, rather than claim to be for the free market while jerking off Big Telecom with one hand and flipping off consumers with the other

treewojima posted...

yes. for starters, they actually have healthy competition among Internet service providers, coupled with subsidies that incentivize said providers to treat network traffic as equally as possible. in other words, they took the free market approach and made it work for everyone, rather than claim to be for the free market while jerking off Big Telecom with one hand and flipping off consumers with the other

Uh... we're talking about mobile service providers? not internet service providers (Last I checked, T-mobile, Sprint, AT&T, and Verizon are the former)

lol, this guy thinks cellular voice service isn't just data on an IPv6 network

sktgamer_13dude posted...

Also AT&T/Verizon have like 60-70% of the market currently. T-Mobile/Sprint COMBINED don't equal AT&T OR Verizon in market share.

https://www.statista.com/statistics/199359/market-share-of-wireless-carriers-in-the-us-by-subscriptions/

This. T-Mobile and Sprint are so far behind, that their merger presents exactly zero risk of them forming a monopoly.
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