US Justice Department reportedly leaning to deny T-Mobile and Sprint's merger

Cal Jeffrey

TS Evangelist
Staff member

Bloomberg reports that a source close to the DoJ said the department is not convinced that the T-Mobile/Sprint merger would favor consumer interests. Instead, officials fear that it would hurt overall competition within the market.

“The remedies proposed by the wireless carriers earlier Monday don’t go far enough to resolve the department’s concerns that the deal risks harming competition,” said the source.

The buyout was all but given the green light today when Chairman Pai said he would recommend approving the $26.5 billion deal. In their bid for approval, the two companies agreed to sell off Sprint’s Boost Mobile and committed to having 5G coverage for 85 percent of the US within three years and 90 percent within six.

"It’s hard to say that our concerns could be alleviated by that kind of tinkering."

However, the concessions are not enough to gain DoJ approval. Many are concerned that permanently eliminating one of the four major carriers in the US will work only to drive prices up as the already limited competition will be further restricted.

“It’s hard to say that our concerns could be alleviated by that kind of tinkering,” Maryland Attorney General Brian Frosh said of the deal. "It means that consumers are going to suffer in terms of price, in terms of quality, in terms of opportunities."

The companies claim that the merger is the only way the US can become the leader in 5G innovation. They also feel that joining forces is the only way the two companies can remain competitive with the top two carriers, Verizon and AT&T.

Applying the brakes to the takeover would be unusual for the DoJ’s antitrust head Makan Delrahim, who usually agrees with the FCC on the approval of merger deals. In this case, analysts are not sure how Delrahim’s decision will turn out, calling him “unpredictable." However, the White House’s firm stance on China seems to indicate that the DoJ will ultimately approve the deal.

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Squid Surprise

TS Evangelist
Who is this "source close to the DoJ"?

I'm thinking it's more like "this leak from the DoJ" - in order to garner more favours and influence down the road...

The decision has been made - was almost certainly made weeks ago - and we, the public, will be informed of this "fair democratic decision" in due course :)
 

Uncle Al

TS Evangelist
It's a good move. Now they need to follow it up by splitting up some of the other "giants" to improve competition for those consumer dollars .....
 

yRaz

Nigerian Prince
Seems like you believe a T-Mobile / Sprint merger would actually benefit the consumer and the workforce?
Yes, I do. I think it would finally force the other big two to stop bending over consumers. Do you actually beloeave ATT and Verizon have your best interest at heart?