Despite this radical change in the merger, Chairman Pai has refused to put the new arrangement out for public comment,” noted Gigi Sohn, who was counselor to former FCC Chairman Tom Wheeler. “The FCC majority prejudged the merits of this merger two months before the Justice Department found the combination of T-Mobile and Sprint to be anticompetitive and required the creation of a new fourth competitor to pass legal muster. Others are concerned that the deal seemed to be a done deal even before Justice handed down its recommendations to improve competition following the merger. “The proposed transaction is exactly the type of merger that the Justice Department and the Commission have discouraged and rejected in the past: one that would harm competition and result in higher prices and poorer service, particularly for the most vulnerable consumers,” wrote Starks. In fact, the Justice Department even thinks that may happen, which is why it is requiring the carriers to hastily assemble a new competitor out of whatever parts are left laying around, including some still being used by T-Mobile and others. More than anything else, though, critics remain skeptical of the basic idea that consolidation will produce increased competition. If substantiated, this would represent the misuse of nearly 10 percent of the funds for the entire program.” “Our review should have been held in abeyance following the Chairman’s recent announcement of an investigation into Sprint’s alleged misappropriation of Lifeline support for 885,000 ineligible accounts. “Sprint may be responsible for the most egregious violations of our Lifeline rules in FCC history,” Starks wrote in a statement. “Instead of promoting vigorous competition among providers, today’s order justifies increased concentration by jerry-rigging a new provider dependent on the government dictating who sells what to whom and when,” she said in a statement.”Ĭommissioner Starks indicated his dissent on other grounds as well, specifically recent charges that Sprint has been irresponsibly deploying funds from the Commission’s Lifeline program for low-income mobile subscribers. Sound a bit far-fetched? FCC Commissioner Rosenworcel thinks so as well. The hope is that Dish, Boost and a few other players will somehow band together to form a new insurgent wireless network that will rise to compete with its former masters. The DoJ’s proposed remedies for competition problems created by the merger apparently gave the FCC “further confidence” in its approval, which Chairman Ajit Pai signaled earlier this year – interestingly, before those remedies were proposed.Īmong other things, Sprint must sell its Boost Mobile brand, and T-Mobile must sell its interest in Dish Network. This latest attempt by the two companies (and backers like SoftBank, which stands to make a bundle on the deal) has met with more success, and the Department of Justice approved it in July. The announcement of a $60 million FTC settlement over anti-consumer business practices by AT&T when they had the leverage to carry them out is a timely reminder of the general temperament of mobile carriers. Previous attempts at deals were blocked more or less on the grounds that while a consolidated market might make the new T-Mobile/Sprint entity more competitive, it would be a net negative for consumers, who would have less choice than ever. (Disclosure: TechCrunch is owned by Verizon Media, but this does not affect our coverage in the slightest.) The two mobile companies have been attempting to merge for years, ostensibly in order to compete with the considerably larger AT&T and Verizon. Those opposed say the merger defies common sense, creating a triumvirate of mobile giants that will “divide up the market, increase prices, and compete only for the most lucrative customers.” The FCC has given its stamp of approval to T-Mobile and Sprint’s proposed merger, saying the deal will “enhance competition” and hasten 5G deployment.
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