FCC taking comments on potential $59 billion combination of Sprint and T-Mobile US
Since opening up the public input period last month, the U.S. Federal Communications Commission (FCC) has received more than 300 comments on the proposed merger of T-Mobile US and Sprint. While some of the filings are from industry trade groups and involved companies, many are from consumers across the country. Based on a review on the public documents, it seems consumers are acutely focused on the impact a combination of the two carriers would have on pricing, although there’s not a clear consensus on whether a tie-up would help or hurt the average ratepayer.
The companies announced in April the proposed $146 billion transaction, which values Sprint at $59 billion. T-Mo parent Deutsche Telekom would control the so-called “New T-Mobile,” while Sprint parent SoftBank would take a back seat. Executives from the two U.S. service providers, in their effort to build regulatory approval, are playing up the importance of a merger in delivering 5G in the domestic market. Specifically, execs point to Sprint’s 2.5 GHz holdings as well as T-Mobile US’ spectrum at 600 MHz, and held up their vision as the way for the U.S. to “take its rightful place” as a global 5G leader, in the words of T-Mobile US CEO John Legere.
In addition to pricing concerns, some consumers who provided comment to the FCC are also aware of the 5G conversation. Consider what Bill from Fort Lauderdale, a former Sprint customer, said: “Increase in pricing and diminishing service, that is what we will get. T-Mobile’s parent company is Deutsche Telekom AG (Germany) which by revenue is the largest telecommunications provider in Europe. They have both the technical capability and the available funds (publicly traded company), to complete upgrades to the network within the U.S. to 5G…or to provide other service improvements without a merger. I for one will move to another carrier if the merger takes place and Sprint has any authority within T-Mobile.”
Daniel Dodd of Mount Pleasant, Iowa, is also concerned the merger “will do more hard than good. The merger would limit the variety on cell phone carriers in the nation which means lack of competition in the market.” Dodd is a prepaid user and worries “the prices will go up for everyone that is on both sides of this merger.”
On the other side of the question, Daniel Barrera of San Antonio, Texas, took a page from Legere’s book, opining that AT&T and Verizon “have had too much control over the wireless industry for too long. Only when T-Mobile began to challenge them with low prices and various other tactics they have begun to offer reasonably priced service and more data and now unlimited plans. This will be good for consumers.”
Richard Wright of Roswell, Ga, agrees that a merger “will increase competitiveness of the markets which will lead to better total quality of service and prices for all consumers.” He described the current cellular service provider market as “bifurcated” and “metro-focused.”
By way of a timeline, petitions to deny the deal are due into the FCC by Aug. 27, oppositions are due Sept. 17, and replies are due Oct. 9.
