US: Former DOJ chief counsel sees T-Mobile, Sprint merger affecting the poor

The poorest US consumers would lose most from the proposed tie-up of wireless carriers T-Mobile US Inc and Sprint, according to consumer advocates who warned the combined company would hike fees for pre-paid and other low-cost mobile phone plans, reported Reuters.

T-Mobile and Sprint announced a US$26 billion all-stock deal on Sunday, April 29, saying they believed they could win over skeptical regulators because the merger would create thousands of jobs and help the United States beat China in creating a 5G, next generation mobile network.

But consumer groups complained the deal would lead to higher prices, hitting low-income people the hardest and leaving them fewer alternatives for communication.

“Lower income consumers are likely to lose the most options and face stiff price hikes because Sprint and T-Mobile are the only game in town for them,” said Gene Kimmelman, president of advocacy group Public Knowledge and a former chief counsel for the US Justice Department’s Antitrust Division.

In its antitrust review, the Justice Department would likely view the prepaid market as a separate market, and if they do the companies could be in for a tough review, experts said.

Full Content: Reuters

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