With the support of the Justice Department (DOJ) and FCC president Ajit Pai, I would have thought the $ 26.5 billion T-Mobile-Sprint merger would be completed. But a lawsuit brought by 16 general prosecutors and the Washington D.C. AG that tries to block the transaction will not be processed until December 9th. While T-Mobile and Sprint have started discussing discussions about agreements between them and the plaintiffs, there is no sign that an agreement is at hand. T-Mobile will not sign the documents to close the deal until the dispute ends.
Initially, the attorneys general of nine states participated in the cause, and since then they have been joined by seven others. But on Monday, the state attorney general joined the attorneys general of five others claiming the combination of the third and fourth-largest carriers in the country. In a press release, Louisiana attorney general Jeff Landry said the merger will provide more wireless services to Americans living in rural areas. Louisiana now joins Kansas, Nebraska, Ohio, Oklahoma and South Dakota; All six states submitted documents to the court asking for the merger to be authorized. As part of some concessions made to appease the FCC, T-Mobile has agreed to cover 97% of the country with a low-band 5G service (85% in urban areas) within three years of closing the agreement.
T-Mobile says the merger will add 11,000 jobs by 2024
States attempting to block the merger argue that the agreement would violate antitrust laws, eliminate jobs and lead to higher prices. However, T-Mobile CEO John Legere stated from the beginning that the merger will create new jobs. Last October, the executive discussed it at a town hall meeting broadcast to Sprint employees and said that 3,000 new jobs would be created in the first year after the merger, reaching 11,000 in 2024. During the event, Legere he said: “T-Mobile employees don’t automatically get a job; Sprint employees don’t automatically get a job. We are going to choose who is the best person that is suited to do specific jobs, and that is a big deal.”
As for the fear of a price increase, as part of his agreement with the FCC, T-Mobile promised to freeze prices for three years after the merger ended. And despite warnings from the state attorney generals that the transaction is anti-competitive, a stronger T-Mobile-Sprint could be more problematic for Verizon and AT&T than the status quo. Also, under the agreement to get the Justice Department’s approval, Sprint agreed to establish Dish Network as “the fourth largest competitor in the nation-based network.” For $ 5 billion, Dish gets Boost Mobile, Virgin Mobile, 14MHz 800MHz spectrum, access to 20,000 mobile sites and hundreds of retail stores. Dish has signed a seven-year MVNO agreement with T-Mobile so that it can offer a wireless service while building its 5G network.
(via Fierce Wireless)
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