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FCC Again Pauses Review Of T-Mobile’s Acquisition Of Sprint

T-Mobile US and Sprint have to wait, once again, for their proposed $26 billion merger to reach a conclusion. The Federal Communications Commission (FCC) put its review of the deal on hold for the third time since it was filed last year after the companies “filed significant additional information regarding their network integration plans for 2019-2021,” according to an FCC notice.

The informal 180-day shot clock was paused for almost three months last September, after T-Mobile US and Sprint filed new documents. It was paused again for about three weeks during the 35-day federal government shutdown that ended. Jan. 25. Both delays disrupted momentum and appeared to fuel growing opposition to the deal.

The shot clock is idling once again, resting at day 122. Public comments and reactions to the latest documents filed by T-Mobile US and Sprint are due March 28.

The significance and potential impact of the latest pause is largely unknown, but the companies have faced a barrage of criticism during the last month. The leaders of T-Mobile US and Sprint last month faced tough questions from Congress during testimony before the House Subcommittee on Communications and Technology and will once again be summoned to Capital Hill this week to testify before the House Judiciary’s Subcommittee on Antitrust, Commercial, and Administrative Law.

Lawmakers have no formal bearing on the outcome of the proposed merger, but the ongoing debate about the merits of the deal has shifted into prominence and put the companies on more defensive footing. During the last week, a group of progressive Democrats lobbied the FCC and Department of Justice to block the merger, and a subsequent report from the New York Post indicated that DOJ staffers are “not impressed” with the arguments being presented for the deal’s approval.

5G Plans

As opposing forces gather momentum, T-Mobile US and Sprint are trying to balance the need to move forward with independent plans for 5G without muddying their respective arguments for additional spectrum and resources to deploy 5G nationwide. One of the central arguments for the merger has shifted as a result, and the additional documents being filed with the FCC have caused further delays.

The longer the merger review goes on the more difficult it is for each company to repeat those claims without moving forward on independent plans. During last month’s MWC Barcelona event, Sprint said its initial mobile 5G launch will reach millions of people in nine markets in the coming months. The company hasn’t committed to nationwide coverage plans yet and recently told Congress it will need up to $25 billion to build a 5G network as a standalone company.

Meanwhile, T-Mobile US has committed to reach nationwide coverage with its mobile 5G network in 2020. It also released new details about home-based Internet services that will compete directly with the nation’s cable companies, but couched those plans to garner more support for the merger by highlighting the average speeds it could eventually reach with Sprint.

In-home broadband wasn’t cited in the companies’ original merger announcement in April 2018, but it’s been added and revised in multiple filing updates with the FCC.

“A core promise of New T-Mobile is our commitment to bring real competition and real choice for in-home broadband to rural America,” T-Mobile US CEO John Legere wrote in a blog post. “We will offer a meaningful new option to millions of Americans in the form of New T-Mobile Home Internet,” he noted, adding that T-Mobile US plans to have 9.5 million customers on the service by 2024.

The companies hope new details about their business plans will generate enough support for the merger to be approved by regulators. But it’s unlikely to change the views of lawmakers, unions, and competitors in the wireless industry that claim the merger will lead to job losses, reduced competition, and higher prices for consumers.―SDX Central

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