FCC Formally Approves Merger of T-Mobile and Sprint

The U.S. Federal Communications Commission on Tuesday formally approved the $26 billion merger between T-Mobile and Sprint. The approval was the last regulatory hurdle to creating a new mobile carrier.

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The FCC filing means T-Mobile and Sprint will be allowed to join together as "New T-Mobile" to become a dominant third carrier in the United States alongside Verizon and AT&T. The Department of Justice approved the merger in July.

The finalized order came after a 3-2 vote along partisan lines, with both Democrats against it. FCC boss Ajit Pai said in a statement that the merger would be good for consumers and the U.S. as a whole:

"It would bring the benefits of the next generation of wireless technology to American consumers and advance American leadership in 5G. It would help millions in rural America benefit from high-speed 5G mobile broadband service... and it would promote competition."

However, FCC Commissioner Jessica Rosenworcel was one of the dissenting voices, and argued that the consolidation of the two companies would likely follow the same path as previous mergers, leading to higher prices and poorer service for the majority of customers:

"We've all seen what happens when market concentration increases following a merger. A condensed airline industry brought us baggage fees and smaller seats, even as the price of fuel fell. A condensed pharmaceutical industry has led to a handful of drug companies raising the prices of lifesaving medications, taking advantage of those struggling with illness. There's no reason to think the mobile-phone industry will be different."

Together, the two companies have committed to building out a nationwide 5G network covering 97 percent of the U.S. population within three years and 99 percent within six years. T-Mobile and Sprint have also promised that they will not raise prices for three years following the completion of the merger.

In an attempt to ensure a competitive wireless carrier market, the FFC also wants to see Dish become the fourth nationwide facilities-based wireless carrier in the United States. Dish has announced that it plans to deploy a 5G broadband network capable of serving 70 percent of the U.S. population by June 2023.

A number of states have filed an antitrust lawsuit in U.S. federal court to block the proposed transaction, arguing that the merger is not in the public interest, just like AT&T's attempted acquisition of T-Mobile in 2011 and the attempted merger between Sprint and T-Mobile in 2014, both of which regulators blocked. The lawsuit filed by the bipartisan coalition of more than a dozen state attorneys general remains on the docket and must be resolved before the merger can go forward.

T-Mobile and Sprint anticipate that the merger will be permitted to close by the end of the year. If it does go ahead, it will combine two of the four major wireless carriers in the United States, giving the new company nearly 100 million customers.

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Top Rated Comments

DoctorTech Avatar
60 months ago
As of 3Q18 (the most recent data I could find in a quick search) Verizon had 35% of the US wireless carrier market, AT&T had 34%, T-mobile had 17% and Sprint had 12%. While I generally agree that mergers = less competition = bad for consumers, this case might be an exception. Because the 2 biggest players control nearly 70% of the market, T-mobile and Sprint individually are a distant 3rd and 4th place but combined they would be a close 3rd place. That might actually make them more of a competitor to the big 2.
Score: 24 Votes (Like | Disagree)
maflynn Avatar
60 months ago

Hopefully, they replace the T-Mobile management with the people from Sprint.
Why, Sprint is the worst, I hope its the opposite and to my knowledge, its T-Mo taking over Sprint
Score: 23 Votes (Like | Disagree)
tdar Avatar
60 months ago
I would normally be against this merger. But not in this case. Why? First Sprint is not a stable company that is able to compete well enough to be able to survive long term. Secondly, as is part of the talking points of the companies, 5G changes the game. Without this merger, neither Sprint or T-Mobile will be able to have a full and effective 5G network. So rather then reducing competition, the combined company will be able to offer it to ATT and Verizon. For those that are concerned that this reduces us to only 3 carriers, the 5G market without the merger would have reduced us to 2. And that would have been a disaster for consumers.
Score: 15 Votes (Like | Disagree)
BuffaloTF Avatar
60 months ago

T-Mobile uses GSM while Sprint uses CDMA; any idea how this merger affects their network?
What is this, 2000? Not a concern, hasn't been for a long time. Cricket was CDMA, Metro PCS was CDMA, Alltel was CDMA. They were each bought by either AT&T or T-Mobile and migrated without a hitch. Why?

Everyone uses LTE. GSM is long dead, CDMA is on life support. GSM died at EDGE, it was replaced by W-CDMA, or UMTS (3G). UMTS is still hanging on, but being phased out. CDMA is being shut down by Verizon at the end of the year, and everyone must be off by December 31, 2020 when they flip the final switch.

LTE is part of the GSM *ASSOCIATION* upgrade path. And it is totally different technology than GSM, CDMA, and W-CDMA.
Score: 11 Votes (Like | Disagree)
nfl46 Avatar
60 months ago
We can expect low prices in the beginning, but don’t worry, they will gradually increase. Think of the live TV streaming services. They had us fooled. Now, their prices are increasing every few months or so.
Score: 10 Votes (Like | Disagree)
brgjoe Avatar
60 months ago
Yeah, I have mixed feelings on it as well.

I am a Sprint customer (ok, quit that laughing). I have had very good service in my town for quite awhile with it though. And T-Mobile's coverage is still spotty around this area, from what I have been told.

But...it could be argued that a Sprint/T-mobile merger would be a good thing in that it will be a company large enough to effectively compete with the larger carriers out there (Verizon and AT&T).

I guess we shall see...
Score: 8 Votes (Like | Disagree)