DOJ approves merger of T-Mobile & Sprint, but states' lawsuit awaits [u]

Posted:
in iPhone edited July 2019
The U.S. Department of Justice announced on Friday that it has approved a proposed $26 billion-plus merger of Sprint and T-Mobile, though with major concessions, and a lawsuit from 13 state attorneys general still pending. [Updated with Dish's multi-billion payouts]

T-Mobile store


Under the terms of the agreement, Sprint will have to divest itself of several prepaid brands including Boost Mobile and Virgin Mobile. Most significantly, both Sprint and T-Mobile are handing some of their wireless spectrum over to Dish Network, along with 20,000 or more cell sites and hundreds of stores.

As anticipated, Dish will also have access to T-Mobile's network for seven years while it builds up its own 5G services.

"With this merger and accompanying divestiture, we are expanding output significantly by ensuring large amounts of currently unused or underused spectrum are made available to American consumers in the form of high quality 5G networks," wrote DOJ antitrust chief Makan Delrahim.

The merger can't be finalized however until a lawsuit from 13 state attorneys general and the District of Columbia is concluded. A trial date is set for Oct. 7, though that date could be pushed as late as Dec. 9.

It's also possible that the case could be settled out of court, since it revolves around a lack of competition in the national wireless space. With Dish being propped up as a replacement for Sprint, there may not be reason to continue.

"We're reviewing the announced settlement, but our bottom line remains the same: protect consumers and competition," said a spokesperson for California Attorney General Xavier Becerra, speaking to CNBC.

Today's news was met with skepticism by Democratic FCC Commissioner Jessica Rosenworcel.

"Today the Department of Justice gave its blessing to the largest wireless merger in history," she wrote on Twitter. "I remain skeptical that this combination is good for consumers, good for competition, or good for the economy. Before the @FCC votes on this new deal, the public should have the opportunity to weigh in and comment. Too much here has been done behind closed doors."

Sprint and T-Mobile have repeatedly attempted to merge, trying the first time in 2014, then again in 2017. The first instance collapsed because of regulatory issues -- in the second case, Japan's SoftBank was reluctant to give up its control of Sprint.

The current effort, so far the most successful, began over a year ago. The Republican-controlled FCC was relatively quick to throw its weight behind the merger, doing so in May 2019. As a condition, T-Mobile and Sprint agreed to improve rural coverage and build out 5G networks.

Update: Dish is paying $1.4 billion to claim Sprint's prepaid operations, and $3.6 billion for wireless spectrum.

Comments

  • Reply 1 of 12
    SpamSandwichSpamSandwich Posts: 33,408member
    The divestitures make no sense, but at least the deal finally went through for the sake of both companies.
    applesnorangescurtis hannahrepressthis
  • Reply 2 of 12
    GeorgeBMacGeorgeBMac Posts: 10,710member
    Blocking this merger never made sense to me:   I would much rather have 3 strong, major companies competing than two colluding with each and then a couple "also ran's" tagging along for the ride.
    applesnorangesbig kcanantksundaramcurtis hannahrepressthis
  • Reply 3 of 12
    georgie01georgie01 Posts: 403member
    Years ago when the merger was on the table I was totally against it—I switched to T-Mobile from Sprint because Sprint had astoundingly deceptive customer policies and T-Mobile had astoundingly good ones.

    Back when I used Sprint they not only refused to unlock paid off iPhone 4s’s (they still won’t...!), they constantly and deliberately lied and misled their customers who were trying to get them unlocked—there were forums after forums with Sprint representatives saying the same lies, with customers reporting the same deceptive tactics while talking to customer service (I had the exact same experiences). I’ve never seen such blatant dishonesty from a company in my life.

    I didn’t want T-Mobile to be anything like Sprint. I became less bothered about the merger when I heard that John Legere would lead the company, but it still makes me feel unsettled. T-Mobile has completely shaken up the industry for the better, lower prices, more data, actual device payments instead of an inflated monthly contract, etc.
    applesnorangescurtis hannahrepressthiscornchip
  • Reply 4 of 12
    eightzeroeightzero Posts: 2,648member
    What is a "democratic FCC commissioner?" Is that different than the FCC Commissioner? FCC is like the DOJ - an executive agency, right? 
    curtis hannah
  • Reply 5 of 12
    Roger_FingasRoger_Fingas Posts: 148member, editor
    eightzero said:
    What is a "democratic FCC commissioner?" Is that different than the FCC Commissioner? FCC is like the DOJ - an executive agency, right? 
    It's just her political affiliation. The FCC chairman, Ajit Pai, is Republican-leaning and tends to vote/lead along party lines.
    GeorgeBMac
  • Reply 6 of 12
    GeorgeBMacGeorgeBMac Posts: 10,710member
    eightzero said:
    What is a "democratic FCC commissioner?" Is that different than the FCC Commissioner? FCC is like the DOJ - an executive agency, right? 
    Like the DOJ, it's SUPPOSED to be impartial and apolitical.  That used to be the theory anyways....
    cornchip
  • Reply 7 of 12
    davgregdavgreg Posts: 921member
    Sprint has been a dead man walking for a long time now and T-Mobile needed to grow in order to become fully competitive against AT&T and Verizon.

    The argument about competitiveness in wireless is really not valid as the overwhelming majority of Americans have choice in the wireless space. Where the concern should be is the lack of competition for fixed internet- wired or wireless. Internet connectivity has become an essential utility unless you want to live a monastic life out in the sticks.
    GeorgeBMac
  • Reply 8 of 12
    davgregdavgreg Posts: 921member
    Sprint has been a dead man walking for a long time now and T-Mobile needed to grow in order to become fully competitive against AT&T and Verizon.

    The argument about competitiveness in wireless is really not valid as the overwhelming majority of Americans have choice in the wireless space. Where the concern should be is the lack of competition for fixed internet- wired or wireless. Internet connectivity has become an essential utility unless you want to live a monastic life out in the sticks.
  • Reply 9 of 12
    anantksundaramanantksundaram Posts: 20,252member

    Today's news was met with skepticism by Democratic FCC Commissioner Jessica Rosenworcel.

    "Today the Department of Justice gave its blessing to the largest wireless merger in history," she wrote on Twitter. "I remain skeptical that this combination is good for consumers, good for competition, or good for the economy. Before the @FCC votes on this new deal, the public should have the opportunity to weigh in and comment. Too much here has been done behind closed doors."
    Let me see: (1) It brings additional competition to an entrenched, rapacious duopoly (ATT and Verizon), and incentivizes them to accelerate their 5G plans; (2) T-Mobile and Sprint have agreed to roll out 5G that covers 97% of the US population within three years; (3) T-Mobile and Sprint have agreed to not raise prices for three years; (4) T-Mobile and Sprint have agreed to onerous divestiture terms with a gun pointed to their heads.

    What exactly is this Jessica-person smoking? What planet is she from? For whom does she actually work?
    edited July 2019
  • Reply 10 of 12
    anantksundaramanantksundaram Posts: 20,252member
    davgreg said:
    ... as the overwhelming majority of Americans have choice in the wireless space. ...
    Yeah, between TweedleDee and TweedleDum.
    cornchip
  • Reply 11 of 12
    waltgwaltg Posts: 90member
    This is great, Finally!! It will make a much better company than the two separate, I will also give the two biggies(that are setting on their backsides charging high rates) some more competition and make the market much better for the end consumer,, ME!!! I live in a rural community, SLOW DSL is the ONLY game, tried a version hot spot, in the evenings it was so slow the DSL was faster! More power to them if they can build out a 5G network that includes the people that live in the country to get better and faster service!!!!
  • Reply 12 of 12
    I actually like the sound of this. We get one more competitor in Dish since they've had a boner for 5G a long while now. There's even a countdown until they launched some big thing in all their call centers. It was hyped up during training. They are so happy about this. They get access to T-Mobile's network while they build up their own 5G, but they've been headed that way with the mmwave shit this whole time anyway and now have a pathway to a network to expand their reach beyond densely packed suburban areas they admitted was their only downside. A satellite-based service can't severely limit its access like that. They've seen the path television is taking and they're heading it off. We're consuming so much media online now and while cable is the big dog in broadcast television, there's some big money in the onlines. They already sling it to you and sell it a-la-carte. They really do want to please those people who hate cable and everybody's starting walling off their own gardens. It's a good bet. 

    We could also possibly get one more large, national carrier in their spin-offs merging. You have to be big to survive covering such a large and varied landmass. It's just the nature of this beast and we'll have to accept that it's not going to be an easy task. We need more carriers, but they all have to be gargantuan. Sounds like maybe we should have better regulation, but let's take this one step at a time because right now we need the numbers. 
    cornchip
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