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T-Mobile-Sprint Decision Draws Crowd

A district court judge's decision upholding the Justice Department and FCC approval of the Sprint-T-Mobile merger drew immediate reaction from Washington.  

Both the FCC and Justice had argued the deal would help speed the 5G rollout, with conditions that would ultimately create a new, facilities-based, competitor, helping justify the reduction of the Big Four--AT&T, Verizon, T-Mobile and Sprint--wireless carriers to the Big Three. 

Delrahim Derides State Efforts to Derail T-Mobile-Sprint Merger 

“I’m pleased with the district court’s decision," said FCC chair Ajit Pai. "The T-Mobile-Sprint merger will help close the digital divide and secure United States leadership in 5G. After the merger, T-Mobile has committed to bringing 5G to 97% of our nation’s population within three years and 99% of Americans within six years. Its 5G network will also reach deep into rural areas, with 85% of rural Americans covered within three years and 90% covered within six years. This transaction represents a unique opportunity to speed up the deployment of 5G throughout the United States, put critical mid-band spectrum to more productive use, and bring much faster mobile broadband to rural Americans." 

“The New York District Court rightfully came to the same conclusion in considering the T-Mobile and Sprint merger as I did during my review, and I am pleased that the deeply flawed case made by the state Attorneys General was rejected," said Republican FCC Commissioner Michael O'Rielly. "It is time to wrap up the entire process and allow these parties to merge. Once completed, a new T-Mobile will have certain commitments to meet, but I am excited to see it return to its mavericky style, quickly deploying 5G networks and intensely competing in the wireless marketplace, ultimately bearing out our expectation that it will provide consumers with new innovative offerings and a creative choice of packages.”

More than a dozen states had sued to block the deal, saying it would raise prices and reduce competition. 

“I am pleased and agree with Judge Marrero’s decision to deny the injunction, and particularly his conclusion that the department’s divestiture and remedy package resolves the competitive concerns in this case,” said Assistant Attorney General Makan Delrahim , head of the DOJ's Antitrust Division. “This opinion is an important next step toward strengthening competition for high-quality 5G networks that will benefit American consumers nationwide.”

“This is good news for U.S. consumers who benefit from economies of scale and free markets picking winners and losers, not bureaucrats or politicians," said Jessica Melugin, associate director of the Competitive Enterprise Institute's Center for Technology and Innovation. "This merger isn’t about taking the number of wireless providers from four to three, it’s about letting the third and fourth biggest players combine in order to be a third provider of 5G, alongside Verizon and AT&T.” 

"While the expert career staff at the Federal Communications Commission and Department of Justice have already determined this transaction is in the public interest and will promote competition, I look forward to seeing the New T-Mobile continue to deliver on its commitments to serve rural America and inject further competition into the fast-changing wireless marketplace," said House Energy & Commerce Committee ranking member Greg Walden (R-Ore.).

“I’m pleased that Judge Marrero has denied the attempt of a minority of states to second-guess the considered decisions of the Department of Justice and the FCC to allow the T-Mobile/Sprint merger to be consummated," said Free State Foundation President Randolph May. "In comments before the FCC and before the the District Court, I explained that, all things considered, the merger was likely to increase competition and overall consumer welfare not only in today’s wireless marketplace but in the broader telecommunications marketplace as well."

“While NATE as an organization did not take a formal position on the proposed T-Mobile/Sprint merger, the news this week of a favorable merger ruling provides much needed clarity in the industry," said National Association of Tower Erectors Executive Director Todd SchleKeway. "We are particularly pleased that this decision came prior to our annual NATE UNITE 2020 Conference as this merger will be a major topic of conversation at our event. NATE and our 930 member companies are optimistic that this T-Mobile/Sprint merger news will ultimately lead to increased carrier and vendor spending investments that are necessary in order to build, install and maintain the next generation networks and related infrastructure that are so critical to the 5G deployment cycle in the United States."

But not everyone was cheering, including the losing parties, the public interest groups and unions that had fought the deal, and Democratic regulators who had opposed it.

New York Attorney General Letitia James, whose state was one of the leads in the suit, was not pleased.

“Today’s decision marks a loss for every American who relies on their cell phone for work, to care for a family member, and to communicate with friends," she said. "We disagree with this decision wholeheartedly, and will continue to fight the kind of consumer-harming megamergers our antitrust laws were designed to prevent." 

That could include appealing the decision to a higher court.  

"As we review our options, including a possible appeal, Americans should continue to hold the companies to account for their promises," she said. 

“The merger between T-Mobile and Sprint will dramatically alter America’s wireless landscape," said Democratic FCC Commissioner Geoffrey Starks, who voted against the merger. "The state Attorneys General presented a strong case. The court saw it differently. In particular, given how central DISH’s future role as a wireless competitor was to the court’s decision, I remain disappointed that those facts were not fully vetted in the merger that I voted on. Nevertheless, the merging parties have made significant promises – to lower prices, to deploy 5G throughout the country, and to increase the diversity of their suppliers, employees and executives. Moreover, DISH has promised to build a 5G network from scratch in a few short years. I look forward to seeing how these companies will fulfill their promises to the American people.” 

“This is disappointing," said Commissioner Jessica Rosenworcel, the other "no" vote in the FCC's 3-2 approval of the deal. "I am concerned that antitrust enforcement is not working for consumers. Going forward it is absolutely essential that the FCC enforce the promises made by these companies in their effort to secure approval from this agency. Any other outcome would be unacceptable—because in our 5G future we cannot afford to leave anyone behind.”

"We are profoundly disappointed that the judge approved a merger that will harm communities of color and low-income communities across California," said Greenlining Institute Technology equity director Paul Goodman. "T-Mobile's tepid promises to offer low-cost services were contradicted by T-Mobile's own experts, and T-Mobile's commitments are too vague and full of loopholes to ensure that the merger is in the public interest. The Greenlining Institute will continue to fight the merger at the California Public Utilities Commission to ensure that communities of color have access to affordable, high quality service." 

“How many times will judges and antitrust enforcers be fooled by the empty promises these companies make to get these deals approved?" said Free Press VP of policy and general counsel Matt Wood. "Using an unhealthy mix of hubris, bad judgment, and petty politics, the FCC’s Republican majority and Donald Trump’s attorney general for antitrust decided to wave this deal through — reportedly ignoring the advice of staff at both agencies who had called to reject it. More than a dozen state AGs rightly stepped in to fill the void, making the obvious case that the competition between Sprint and T-Mobile benefits all wireless users and especially those who seek out lower-priced plans and greater value." 

“Today's decision is a tremendous loss for consumers, the American economy, and antitrust law itself," said Joshua Stager, senior counsel at New America's Open Technology Institute. "This merger was plainly illegal from the moment it was announced, which is why the Trump Administration twisted itself into knots devising one of the most convoluted antitrust remedies in living memory.

“Markets don’t recover from mergers like this one—they turn into oligopolies marked by high prices, collusion, and inequality," Stager said. "Unfortunately, the court fundamentally misunderstood how the wireless market operates, and consumers will quite literally pay the price for its misguided ruling." 

“Throughout this process, regulators who are supposed to be protecting the public interest have ignored clear evidence that this merger would result in significant job loss for wireless workers,” said Communications Workers of America President Chris Shelton in a statement. “We are grateful to the attorneys general who stepped in to try to protect workers and customers after President Trump’s appointees at the FCC and Department of Justice ignored their concerns. This decision does not mean that we will stop fighting to protect jobs and raise standards for workers across the industry.

“We are deeply disappointed in the Court’s decision to approve the T-Mobile-Sprint merger, which will have significant consequences for consumers and competition," said Michael Copps, special advisor to Common Cause and former Democratic FCC chairman. "All of the evidence in this proceeding shows that this merger is inherently illegal under antitrust law. Even evidence presented at the trial revealed the companies’ executives acknowledged prices for wireless service would rise if the merger was approved. The Court’s decision will reduce the wireless market from four to three national carriers, undoubtedly raising prices on wireless customers."