T-Mobile-Sprint Merger Clears FCC Hurdle
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The Federal Communications Commission on Tuesday issued its formal approval of the merger of T-Mobile and Sprint, a proposed $26 billion tie-up that would unite the No. 3 and No. 4 U.S. telecom providers. The party-line vote was held last month but officially revealed today.
The news comes after the U.S Department of Justice in July agreed to approve the merger, with the condition that the newly combined entity agree to sell Sprint’s Boost Mobile, Virgin Mobile and Sprint-branded prepaid mobile services to Dish Network for $1.4 billion. Dish has been attempting to pivot from its longtime satellite foundation toward a future as a mobile player.
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The proposed divestiture of assets is designed to preserve competition, while the merger would make the newly combined T-Mobile a larger rival to sector leaders AT&T and Verizon.
Other commitments highlighted by the FCC on Tuesday included the new company deploying 5G service to cover 97% of the American people within three years, and 99% of all Americans within six years, with a focus on rural access. It also pledged that within six years, 90% of Americans would have access to mobile service with speeds of at least 100 Mbps and 99% of Americans would have access to speeds of at least 50 Mbps.
“After a lengthy and painstaking review process, the Commission has correctly concluded that this transaction is in the public interest,” FCC chairman Ajit Pai said. “In particular, the transaction will help secure United States leadership in 5G, close the digital divide in rural America, and enhance competition in the broadband market.”
In the meantime, attorneys general in 14 states and the District of Columbia have sued to block the deal, which they say will raise wireless prices for customers. That was a main sticking point of the two Democrats on the FCC, Jessica Roseworcel and Geoffery Starks.
“The T-Mobile-Sprint merger will end a golden age in wireless that helped bring to market lower prices and more innovative services,” said Roseworcel in her dissenting statement released Tuesday. “It will mean an end to the competitive rivalry that reduced prices by 28 percent during the last decade.”
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