DOJ antitrust chief says there's no reason why U.S. must have four major wireless carriers

DOJ antitrust chief says there's no reason why U.S. must have four major wireless carriers
While the Obama administration felt that there should be four major U.S. carriers for the sake of competition, the Trump DOJ has no such magic number. That's the word from Makan Delrahim, the head of the Justice Department's antitrust division. Delrahim told reporters on Friday that "I don’t think there’s any magical number that I’m smart enough to glean," and that bodes well for the $26.5 billion T-Mobile-Sprint merger that was announced on April 29th.

Back in 2014, during the Obama presidency, the FCC and Justice Department shut down plans for a T-Mobile-Sprint merger before it was officially announced. Both carriers were testing the regulatory waters and found too many suit-wearing sharks. At the time, the plans reportedly called for Sprint to buy T-Mobile; that blueprint had to be changed with the emergence of the latter as the most innovative U.S. wireless operator. At the time, former DOJ antitrust chief Bill Baer told the New York Times  "It’s going to be hard for someone to make a persuasive case that reducing four firms to three is actually going to improve competition for the benefit of American consumers."

Delrahim didn't actually give the T-Mobile-Sprint merger a free pass. He did say that both carriers would have to prove that the merger is necessary for the pair to offer 5G service to their customers. That is the tact being taken by the two wireless providers to get the deal approved. The DOJ has already opened an investigation into the deal and the department's Scott Scheele sent a letter to the FCC last month. The letter requested information provided by T-Mobile and Sprint about their resources in relation to handing out phone numbers, and the ability to port numbers from one carrier to another.

The deal could have an effect on the FCC's November auction of spectrum needed for 5G. Since the auction rules prevent bidders from discussing strategy between themselves, T-Mobile and Sprint might not be able to bid together on the airwaves. If both decide to bid independently of each other, it could result in both spending more than they might have together. On the other hand, one of the two might decide to drop out of the bidding to make sure that the rules are being followed.

source: Reuters, Politico

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16 Comments

1. Dr.Phil

Posts: 2361; Member since: Feb 14, 2011

The problem is not so much that there is a monopolization of the actual companies, but more so that there is a monopolization of the available spectrum. There is no way for new competition to come in and start up because the big 3 have bought out all of the spectrum. The only way now for a company to come in and compete is if they somehow create some new form of communication (like a large Wi-Fi signal). The only other major player that has actual spectrum now is Dish Network and they haven't done anything with it. I'm still surprised they didn't try to buy out Sprint before T-Mobile did.

10. BuffaloSouce unregistered

Because there’s going to be some brand new company out of the blue to take everyone over...

2. Crispin_Gatieza

Posts: 3137; Member since: Jan 23, 2014

Of course we don't need 4 carriers, Obama said we do and that's enough for the dotard.

3. Soundjudgment

Posts: 370; Member since: Oct 10, 2016

SprinT-Mobile, here we come.

4. Derekjeter

Posts: 1489; Member since: Oct 27, 2011

Yeah why have competition? I hope people one day realize they have the power to change anything they want. We should have 10 carriers, all fighting for each customer. With out us these multi billion dollar companies wouldn’t be s**t. The only reason I pay for Verizon is the coverage. I’m pretty sure they could still run the company with $20 unlimited plans.

6. tyger11

Posts: 291; Member since: Oct 29, 2012

If you want competition for Verizon and AT&T, T-Mobile needs to get more coverage, and the only way to do that is to acquire more from someone else - and that someone else is Sprint.

11. BuffaloSouce unregistered

Then go prepaid if you want cheap...is Derek Jeter still going around spreading herpes?

5. bucky

Posts: 3784; Member since: Sep 30, 2009

Just look at Canada to understand why more companies is better.

7. tyger11

Posts: 291; Member since: Oct 29, 2012

Two companies with less than stellar coverage (T-Mo and Sprint) are not effective competition for two vastly larger companies like Verizon and AT&T.

8. jonathanfiuwx

Posts: 182; Member since: Mar 10, 2017

Your not counting 600mhz LTE, and the fact they will add more 2.5ghz towers. Att and Verizon can't match 2.5 TDD LTE

9. kennybenny

Posts: 214; Member since: Apr 10, 2017

As a Canadian, I think this is true, telecom companies here follow each other in price increases within days.... I'm not surprised if the Big Three have a secretive agreement with each other to price fix because it is obvious when you look at the prices.

14. guest

Posts: 372; Member since: Jun 13, 2012

You don’t need a secretive agreement monkey see monkey do. They can change plans and pricing in a week.

15. DnB925Art

Posts: 1168; Member since: May 23, 2013

I can counter that with South Korea who have only 3 carriers, provide higher speeds and charge way less than the US. Unfortunately we'll never know what will happen until it actually happens in this country if the merger is approved.

16. DnB925Art

Posts: 1168; Member since: May 23, 2013

I can counter that with South Korea who have only 3 carriers, provide higher speeds and charge way less than the US. Unfortunately we'll never know what will happen until it actually happens in this country if the merger is approved.

12. MANOFSTEEL

Posts: 127; Member since: Nov 25, 2015

I’ll switch to one of the big two if that goes thru

13. Toyoman24

Posts: 42; Member since: Aug 31, 2017

sprint and T-mo will still Suck and won't ever beat Verizon HAHAHAHAHA

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