Oregon becomes the 15th state suing to block T-Mobile from combining with Sprint

Oregon becomes the 15th state suing to block T-Mobile from combining with Sprint
With the FCC and U.S. Department of Justice (DOJ) both giving a green light to the $25.6 billion T-Mobile-Sprint merger, there is just one matter holding things up. Back in June, the attorneys general from nine states and Washington D.C. filed a suit seeking to block the deal. Since then, the number of plaintiffs has continued to grow and Reuters reports that Oregon's attorney general is the latest to join the fray. That brings the total number of states involved in the suit to 15 (not including the Washington D.C. attorney general, of course).

T-Mobile says that it doesn't plan on closing the merger while the suit remains open, and with more states getting involved the chances of reaching a settlement grow slimmer. The plaintiffs argue that combining T-Mobile and Sprint is anti-competitive and will cost residents of their states more than $4.5 billion every year. The trial won't begin until December 9th after a U.S. District Court in Manhattan granted the states the additional time they requested to work on the case.

T-Mobile wants to get its hands on Sprint hoard of mid-range spectrum


Analysts at New Street Research said last week that Sprint and Dish Network have much more to lose if the merger is blocked than T-Mobile does. That's because the latter remains the fastest growing wireless provider in the states; the company just reported another 710,000 net postpaid smartphone additions for the three months from April through June. Sprint lost 128,000 connections in the same category during the same three month period, and even though it has a deep-pocketed parent in Japan's SoftBank, Daddy is no longer interested in shelling out cash for its wayward child.


Dish has just committed billions of dollars to buy Virgin Mobile, Boost Mobile, Sprint's branded prepaid business and some 800MHz spectrum with the goal of turning it into the "fourth nationwide facilities-based network competitor." It also will have to spend billions to build out a nationwide 5G network, open retail stores across the country, and market the new service. Without Dish's agreement to build a new wireless operator from the pieces it is obtaining from Sprint, the DOJ would not have agreed to allow T-Mobile and Sprint to merge.


Even though T-Mobile is indeed doing quite well on its own, the carrier wants Sprint's hoard of mid-band spectrum to place between its low-band 600MHz and high-band mmWave airwaves. The characteristics of low, mid and high band spectrum all meld together to make it easier to create a coast-to-coast 5G network in the U.S. But T-Mobile is also looking at the possibility that the court will rule against the deal and is reportedly asking the FCC to auction off some mid-range spectrum in the 3.7GHz to 4.2GHz range.

The merger was originally announced on April 29, 2018, and both T-Mobile and Sprint signed a pact that was set to expire on April 28th of this year. The two carriers signed an extension that extended the agreement to July 29th and the deal's deadline has been pushed back for the third time.

While the plaintiffs call the T-Mobile-Sprint merger anti-competitive, T-Mobile has agreed to keep prices frozen for the first three years following the merger. In addition, it would seem that a fast-growing T-Mobile-Sprint would be more of a competitive challenge to Verizon and AT&T than keeping the status quo.

FEATURED VIDEO

9 Comments

1. JMartin22

Posts: 2369; Member since: Apr 30, 2013

Just let them merge. The both of them apart won’t stop Verizon Wireless and AT&T’s duopoly stranglehold anyway. Wasn’t one of the conditions was that some spectrum and tower equipment he told to Dish to prop them up as a fourth competitor in the market anyway?

2. Alan01

Posts: 603; Member since: Mar 21, 2012

Yes. As noted in the article, Sprint is selling some of its 800MHz airwaves to Dish. Regards, Alan

3. CDexterWard

Posts: 62; Member since: Feb 05, 2018

I know there's a chance the merger could backfire and screw us consumers, but I'd rather have Dish as a fourth carrier option, sight unseen, as opposed to Sprint. Just sayin'.

4. monkeyb

Posts: 409; Member since: Jan 17, 2018

I have no clue what the issue is here: - TMobile has agreed to keep prices the same for 3 years. - They agreed to helping Dish become the 4th provider. - If US is expecting T-Mobile and Sprint to put billions into making their own individual 5G network and not increase the price is idiotic. - ATT and Verizon will be the prime beneficiaries if this deal fails as Sprint will never be a competition looking at the current scenario. - Dish will actually lower its prices for a few years to gain market share which will benefit US customers. So yes, unless someone has hardcore evidence that US consumers will lose. Please explain to me what the heck is wrong with these people.

5. TBomb

Posts: 1405; Member since: Dec 28, 2012

I'm not sure on the timing of all of this, but verizon used to have a $30 unlimited plan... Again, not sure on the timing.. but Cingular and ATT merged and now my bill is a lot higher for the same thing. Maybe it's a changing of the times and it would have happened anyway. But 3 years of the same prices means nothing if at 3 years + 1 day the prices triple.

8. monkeyb

Posts: 409; Member since: Jan 17, 2018

Thanks for that information. But wouldn’t your plan be grandfathered in? I mean if they increase prices for 5G but have same plans for 4G, it is still okay. They can triple after 3 years with or without the merger. I understand nothing is clear but I think them joining will help create a better network for existing customers and America.

6. southernzombie

Posts: 355; Member since: Jan 17, 2017

The most likely scenario causing all this pushback are the fact that Verizon and AT&T are scared and are throwing money at politicians to stop or slow it down.

9. monkeyb

Posts: 409; Member since: Jan 17, 2018

Yesss. This is exactly what i feel. Dish was against this deal until they got something out of it. Att and Verizon are “probably” playing behind the scenes.

7. superguy

Posts: 448; Member since: Jul 15, 2011

Keep in mind that it's going to take Dish an extremely long time to build out a network. The other carriers have had decades to build out and upgrade their networks. Dish would essentially be starting from scratch while piggy backing off of T-Mo for several years. They would likely have to continue to have a roaming agreement with T-Mo for years after that to ensure adequate coverage - especially in the more rural areas. Dish may want into the market, but unless it's willing to sink billions more into building up the network, they could fail too, and we'd still have 3 carriers remaining. Additionally, they're going to want to recoup the expense on that network. You have no evidence that they'll sell cheap service to build market share and increase the likelihood of operating at a loss. Shareholders won't like that. And even if they do, they're eventually going to have to raise prices to a point where they make a profit. If they're offering dirt cheap service and they significantly raise prices, that can send people right back to the other carriers. You also have evidence from other industries showing that mergers would be beneficial to communities but ended up resulting in higher prices, less choice, less service, and poorer product offerings. The airlines are a prime example of this. These companies broke their promises, so there is more scrutiny on others making the same going forward. Communications companies, including AT&T and Verizon, have also gobbled up others, resulting in fewer actual choices. Is it really 3 different choices for U-Verse, DirectTV, and AT&T TV Now when they're all provided by AT&T? And if you look at other countries' cell options, especially in Europe and Asia, cell service is significantly cheaper there as there is more competition. There is valid concern that our already higher prices can continue to increase with less competition in the markets. I think the market would be better off letting Sprint fail and having some other company like Dish coming in and picking up the pieces. They'd have a network to start off and would be much farther ahead than any Sprint/T-Mo merger. If spectrum is necessary for success, perhaps the carriers could petition the FCC to open up and auction off more spectrum.

Latest Stories

This copy is for your personal, non-commercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customers at https://www.parsintl.com/phonearena or use the Reprints & Permissions tool that appears at the bottom of each web page. Visit https://www.parsintl.com/ for samples and additional information.