T-Mobile/Sprint merger gets official FCC green light

Democratic FCC Commissioners Jessica Rosenworcel and Geoffrey Starks cast dissenting votes in the proposed T-Mobile merger with Sprint, formalizing a situation that appeared to be headed for a party-line vote on the matter.

The negative votes mean the proposal officially gets approved by the full commission, whose Republican members already cast their “yes” votes on the deal, with conditions. The final votes on the deal were due at the FCC today.

The Department of Justice (DoJ) has signed off on the deal as well, contingent that a fourth operator be created through a dissemination of assets to Dish Network, which will initially act as an MVNO using T-Mobile's network..

It’s that fourth operator scenario that has raised the hackles of numerous consumer interest groups and the Communications Workers of America (CWA) union. In a conference call with media today, CWA, the Rural Wireless Association (RWA) and Public Knowledge blasted the DoJ’s “remedy” for the deal and reiterated questions about Dish’s ability to actually become a viable fourth facilities-based competitor.

The Democratic commissioners share some of those same concerns. “This merger takes a bad situation and makes it worse,” Starks said in his statement. “Higher prices and fewer options across the country will inevitably result.”

Starks also made a point of noting the “unprecedented procedural irregularities” in the proceeding, something Rosenworcel has brought up on more than one occasion as well, noting that three of her colleagues agreed to the transaction without any legal, engineering or economic analysis before them.

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“The deal approved today has changed significantly from the one that was originally proposed – twice,” Starks said. “I have been clear: where there is a fundamental change in the structure of a proposed merger, it must be set out for public comment … Moreover, today’s approval comes despite our on-going investigation of Sprint for what appears to be the largest unlawful collection of universal service funds in FCC history. But instead of waiting until we have all the facts, we haphazardly push forward and hope for the best. The rush to judgment here is exemplified by the fact that it was only in response to questions from my office that the draft was amended at the last minute to explicitly preserve liability for these and any other potential violations.”

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The transaction is complicated by the fact the government filed to block the deal but then followed that with a settlement, by which it determined that the harms could be rectified by the conditions and divestitures.

“The remedies that are supposed to save consumers from the problems with this merger do little more than camouflage its harm,” Rosenworcel said in her statement. “With 5G on the horizon, our dependence on wireless connectivity is bound to grow. It’s not the time to count on ineffective deployment commitments, higher prices, and less vigorous competition to help the benefit of this new technology reach us all.”

The deal still faces scrutiny in court as more than a dozen states, led by New York and California, sued to block it; that trial is set to start in December.