Two dozen entities, including several broadband associations, are stepping up their T-Mobile Sprint merger opposition, sending a letter last week to FCC Chairman Ajit Pai and to a Department of Justice official arguing that the proposed merger would harm rural areas and reduce wireless competition.
Most of the entities signing the letter to the FCC and DOJ are in the 4Competition Coalition, an alliance formed to oppose the merger. That includes all the broadband associations that signed the letter: NTCA – The Rural Broadband Association, the Rural Wireless Association (RWA), the Wireless Internet Service Providers Association (WISPA) and INCOMPAS, which represents competitive carriers.
Other entities that are in the coalition and that signed the letter include the Communications Workers of America, DISH Network, broadband advocacy group Next Century Cities, and the Institute for Local Self-Reliance, which advocates for municipal broadband networks, among others.
T-Mobile Sprint Merger Opposition
T-Mobile and Sprint have said that if allowed to merge, they would deploy fixed wireless service to boost the broadband speeds available in rural areas. But according to the letter filed by the 24 entities, the merger threatens to “undermine the services that rural Americans currently enjoy.”
The letter argues, for example, that Sprint currently “stands out for its willingness to wholesale its network to rural wireless carriers – making roaming services possible for their customers” but goes on to say that T-Mobile has shown no interest in such partnerships. Another argument made in the letter is that “the merged parties’ spectrum would not be particularly well suited for rural coverage.”
That comment appears to reference Sprint’s vast spectrum holdings in the 2.5 GHz band. That band is considered mid-band spectrum, meaning it provides better range than high-frequency spectrum but less range than low-frequency spectrum. The latter is often preferred for rural areas because it can minimize the cellsite investment required.
The 4Competition Coalition website includes links to a range of research filed with federal entities in opposition to the merger, and some of the research findings are summarized in the letter, which argues, for example, that the merger would result in price increases exceeding 15% “in many cases” and that the merged company would control more than 50% of the prepaid wireless market, likely generating price increases for low-income Americans.
Last week the Wall Street Journal reported that DOJ antitrust enforcement staff had said the Sprint T-Mobile merger was unlikely to be approved as currently structured. The report was based on comments from unnamed “people familiar with the matter.”
T-Mobile CEO John Legere responded on Twitter, commenting that “the premise of this story” was “simply untrue.” He added that: “Out of respect for the process, we have no further comment. This continues to be our policy since we announced our merger last year.”