US: Democratic senators urge administration to reject Sprint, T-Mobile deal

A group of eight Democratic US senators and independent Senator Bernie Sanders urged the Justice Department (DOJ) and Federal Communications Commission (FCC) on Tuesday, February 12, to reject a proposed US$26 billion merger of T-Mobile and Sprint.

The merger is “likely to raise prices for consumers, harm workers, stifle competition, exacerbate the digital divide, and undermine innovation,” they wrote in separate letters to FCC Chairman Ajit Pai and Makan Delrahim, the DOJ’s top antitrust official.

The signatories included potential or confirmed presidential candidates Sanders, Amy Klobuchar, Sherrod Brown, Kirsten Gillibrand, Elizabeth Warren, and Cory Booker. Also signing the letters were Senators Richard Blumenthal and Tom Udall.

The companies did not immediately comment. A US House panel is set to hold a hearing on the merger on Wednesday.

The senators noted the four largest wireless carriers—including AT&T and Verizon—control 98% of the market.

“Antitrust regulators around the world have consistently blocked four-to-three mergers in the mobile and telecommunications industry, and those who have allowed such mergers have lived to regret it,” they wrote.

Separately, T-Mobile Chief Executive Officer John Legere defended the merger in written testimony released on Tuesday, ahead of a House Energy and Commerce Committee panel hearing on Wednesday.

Legere said the merger would lead to lower prices and more US jobs. Opponents argue the combined entity would likely raise prices, cut costs and harm rural consumers.

Legere’s testimony says the combined firm’s business plan projects “aggressive share increases—taken from the industry leaders AT&T and Verizon—through its accelerated, enhanced 5G deployment.”

He said the company planned to “keep the customers we’ve fought hard to win and win new customers with great quality, lower prices, and more innovative offerings.”

Sprint Executive Chairman Marcelo Claure will tell the panel that the combined firm’s improved network “will be able to compete for customers who have been reluctant to use Sprint or T-Mobile because of concerns that the quality of their individual networks is not as good as those offered by Verizon or AT&T.”

The companies announced the merger in April 2018 after their a first round of merger talks ended in 2014 when President Barack Obama’s administration expressed antitrust concerns.