US Justice Department allegedly wants new spinoff carrier as condition of Sprint & T-Mobil...
The U.S. Department of Justice is reportedly adding an unusual request for the proposed merger between T-Mobile and Sprint -- the spinoff of a new wireless carrier.
The existing carriers are still discussing concessions that could appease the DOJ, Bloomberg sources said. Past reports have indicated Department resistance, given antitrust concerns -- there are just four major national carriers in the U.S., a number that could shrink down to three.
It's unknown what a spinoff carrier might look like except that it would run on the Sprint/T-Mobile network, Bloomberg noted.
The companies have already tendered several concessions, such as selling off Sprint's Boost Mobile brand, committing to a three-year 5G expansion, and avoiding price hikes while that network is under construction. The new entity would still control Metro and Virgin Mobile USA however, giving it huge influence over both the postpaid and prepaid markets.
The deal is valued at about $26.5 billion and already has the backing of FCC chairman Ajit Pai. Both the FCC and the DOJ must sign off ahead of Sprint and T-Mobile's self-imposed July 29 deadline.
The existing carriers are still discussing concessions that could appease the DOJ, Bloomberg sources said. Past reports have indicated Department resistance, given antitrust concerns -- there are just four major national carriers in the U.S., a number that could shrink down to three.
It's unknown what a spinoff carrier might look like except that it would run on the Sprint/T-Mobile network, Bloomberg noted.
The companies have already tendered several concessions, such as selling off Sprint's Boost Mobile brand, committing to a three-year 5G expansion, and avoiding price hikes while that network is under construction. The new entity would still control Metro and Virgin Mobile USA however, giving it huge influence over both the postpaid and prepaid markets.
The deal is valued at about $26.5 billion and already has the backing of FCC chairman Ajit Pai. Both the FCC and the DOJ must sign off ahead of Sprint and T-Mobile's self-imposed July 29 deadline.
Comments
We have t-mobile and I’m happy with them for the most part. Their billing practices are much more transparent and better than AT&T or Verizon and I hope they stay in the market. This request by the DOJ doesn’t make any sense to me though - They’re ok with two companies merging as long as they spin off another company making...two companies. What’s the point?
I buy an iPhone and Sprint charges me $2.99/mo for Visual Voicemail.
VVM is a feature on the iPhone!
Give me a break!
Do not allow this merger!
How about stop using Sprint?
I don't agree with any of that. First, without what regulation? Are you just talking anti-trust? Anti-trust actions are quite rare. Monopolies themselves are not illegal....they have to violate the law. Secondly, creating a monopoly is not "the easiest way to raise profits." Millions of businesses compete in the free market system. The easiest way to make a profit is to have a great product, good marketing, and solid cost control. Apple didn't make its hundreds of billions in profit over the last 20 years by being a monopoly. They were selling the right thing and managing their business the right way. Monopolies can lead to increased profit, obviously. This is why we need to be vigilant for illegal monopolies. But regulation? It's not clear that "regulation" is beneficial in most cases.