FCC Approved T-Mobile Sprint Merger Without Even Seeing The Full Details

from the ill-communication dept

Surprising nobody, the Ajit Pai FCC last week approved T-Mobile's $26 billion merger with Sprint. The approval comes despite that fact that antitrust experts, consumer advocates, and a long list of others have pointed out the deal will reduce wireless sector competition by 25%, inevitably driving up costs and reducing the quality of service (40 years of US telecom history suggests as much). And while T-Mobile and Sprint insists the deal will create jobs, both union reps and Wall Street predict the deal could kill anywhere between 10,000 and 30,000 jobs.

Granted last week's vote of approval was really just a formality. The FCC's majority commissioners had already made it clear they'd be signing off on the deal. Troubling but unsurprising is the repeated allegations that the Trump FCC majority signed off on the deals before seeing most of the actual details, something FCC Commissioner Jessica Rosenworcel was quick to point out in a statement:

"...the process that got us here is equally troubling. Three of my colleagues agreed to this transaction months ago without having any legal, engineering, or economic analysis from the agency before us. Consumers deserve better from the Washington authorities charged with reviewing this transaction."

Yeah, who needs to see the actual details on a transaction that will dramatically alter the US wireless landscape before voting?

Former FCC lawyer Gigi Sohn shared a similar observation in a statement circulated to the media:

"Today’s decision is the culmination of one of the most irregular and opaque processes in FCC history. 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. Despite this radical change in the merger, Chairman Pai has refused to put the new arrangement out for public comment."

No willingness to look at hard data, an active disdain for public input; where have we seen that before? Worth noting the DOJ has followed a similar tack, ignoring advice from its own staffers to sign off on the deal.

Both the DOJ and FCC continue to push a remedy for the problems the deal creates that few think will actually work. They're hoping to have T-Mobile shovel off some additional spectrum and its prepaid wireless brand to Dish Network, who'll then attempt to build a functional fourth competitor to replace Sprint over the next half decade. But Dish has a long, long history of spectrum squatting and empty promises when it comes to wireless (just ask T-Mobile). And this FCC has exactly zero credibility when it comes to holding telecom giants accountable for, well, anything.

To make that deal work, the government will have to helicopter mom the hell out of the deal; ensuring T-Mobile lives up to its obligations and Dish meets its goals. It will also have to hold AT&T and Verizon accountable when they inevitably try to scuttle the deal in a bid to prevent a fourth viable competitor from truly emerging, something that, even under optimal conditions, isn't supposed to happen for years. Imagine thinking that's a more sensible route than just blocking the same deal that's already been blocked several times because it's clearly harmful to workers, consumers, and the market?

Filed Under: ajit pai, competition, details, fcc, merger, telcos
Companies: sprint, t-mobile


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  • icon
    Gary (profile), 22 Oct 2019 @ 6:45am

    Pai isn't paid to help people - just corporations.

    Besides, mergers are a natural part of predatory capitalism, stopping them would require "government regulations" eh?

    reply to this | link to this | view in chronology ]

  • icon
    Anonymous Anonymous Coward (profile), 22 Oct 2019 @ 6:56am

    Hold on to your hats

    At this point the question isn't how much harm the Trump administration (and his minions) will do, but how long will it take (or even if it is possible to) to correct the atrocities. On one hand the bought and paid for Congress will be reticent to overcome corporate entrenchment, and on the other...well I can't think of anything to say about the other because I am not sure it exists.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 22 Oct 2019 @ 6:57am

    I kind of wish the state's rights advocates would just dismantle a corrupt merger a few months or a year after it's approved for immediately violating state law but the state's rights people and the corrupt merger people are usually on the same side unfortunately.

    reply to this | link to this | view in chronology ]

  • identicon
    David, 22 Oct 2019 @ 7:09am

    At least corruption peaked with Pai

    If Trump these days wanted to hire the most corrupt person for some function in order to do the most damage to the general public, there just wouldn't be enough expertise in the White House left to pinpoint a candidate as well-suited as Pai since anybody with a clue got fired already unless they left on their own accord.

    Unfortunately, I don't think we reached peak incompetence already.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 22 Oct 2019 @ 7:31am

      Re: corruption peaked with Pai

      no, the corruption was ALWAYS there from the getgo in 1920's.

      Modern FCC directtly evolved from Federal collusion with the big radio broadcasters... to restrict competition -- just like today with internet big boys.

      By 1922, Secretary of Commerce Herbert Hoover started colluding with major broadcasters (like Westinghouse) to impose harsh new Federal licensing requirements to greatly reduce the number of American radio broadcast companies.

      Learn from history !! This mess began a century ago.

      reply to this | link to this | view in chronology ]

      • icon
        Gary (profile), 22 Oct 2019 @ 8:02am

        Re: Re: corruption peaked with Pai

        Learn from history !!

        From a technical standpoint the airwaves are a limited resource and laissez-faire policies aren't capable of managing like that. Government regulation to limit broadcasters was a necessity, not "corruption."

        reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 22 Oct 2019 @ 7:34am

    and, of course, there was no corruption involved with anyone at the FCC!! yeah, right!!

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 22 Oct 2019 @ 8:34am

    Taking the optimist view for a moment, this merger will result in less overall competition and make it even harder for the cellular companies to claim they should have monopoly status in their markets. Sooner or later we'll get an administration that doesn't completely suck (I know, I'm stretching optimism a bit far here) and take these now 3 companies to task.

    Sometimes (read: usually) things have to get worse before they can get better.

    reply to this | link to this | view in chronology ]

  • icon
    TaboToka (profile), 22 Oct 2019 @ 9:23am

    Jerbs

    Does anyone who isn't an Orange-Cheeto Kool-aid Gulper seriously buy the "it will create jobs" canard?

    Honestly, if a company can't "create jobs" without becoming a monopoly/duopoly, then it deserves to die in a fire.

    Companies create jobs when they have more work than their current labor can handle and it makes economic sense to do so. It doesn't matter how big or small, or how many tax breaks said company gets.

    Even then, I DON'T CARE IF ACME INC DOES OR DOES NOT CREATE JOBS. I'm going to find work somewhere else if I need a job.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 22 Oct 2019 @ 10:15am

      Re: Hollywood style accounting

      Of course a merger creates jobs, the combined company employs more people that either did by themselves, (just fewer than both did together).

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 22 Oct 2019 @ 10:20am

        Re: Re: Hollywood style accounting

        Mergers create all kinds of new jobs. What about unemployment benefits managers?

        reply to this | link to this | view in chronology ]

  • icon
    ECA (profile), 22 Oct 2019 @ 11:22am

    Didnt

    Pai,
    Kicked his section of the Gov. Out of responsibility..
    When did he get this back??

    reply to this | link to this | view in chronology ]


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