State AGs Are Wrong on T-Mobile/Sprint Merger | Citizens Against Government Waste

State AGs Are Wrong on T-Mobile/Sprint Merger

The WasteWatcher

On June 11, 2019, 10 state attorneys general (AGs), in California, Colorado, Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, New York, Virginia and Wisconsin filed a lawsuit opposing the T-Mobile/Sprint merger, claiming that its approval would lead to increased consumer prices and decreased competition.  In six of those states, the public utility commission (PUC) had already approved the mergers, while California’s PUC still has it under review.  The state AGs seem to be engaging in a complete waste of the taxpayers’ money.

The main argument being used by the state AGs is that having three instead of four major wireless carriers is per se anticompetitive.  But this ill-conceived notion of the proper number of competitors does not hold up in today’s converging telecommunications ecosystem.  It also fails to recognize and does a disservice to the large number of wireless providers across the country who are not part of the “big four” offering communications services across the country.  CTIA has identified nearly 100 wireless providers nationwide, with nearly every American having the choice between three or more service providers, and 99.7 percent of the country is covered by 4G.

These are some of the many reasons that 18 of the 19 PUCs needed for the merger have determined it is in the public interest:  Alaska, Colorado, Delaware, District of Columbia, Georgia, Hawaii, Louisiana, Maryland, Minnesota, Mississippi, Nevada, New Jersey, New York, Pennsylvania, Texas, Utah, Virginia, and West Virginia.

On May 20, 2019, Federal Communications Commission (FCC) Chairman Ajit Pai announced that he would approve the merger with several conditions imposed on the new company if it is finalized.  The additional concerns raised by the state AGs are without merit, given that T-Mobile/Sprint have made significant commitments to the FCC, that involve continual verification of milestones and stringent enforcement by the FCC if these milestones and commitments are not met. 

Even after the FCC adopts the request to transfer licenses to the new T-Mobile, the merger faces other hurdles.  The Department of Justice must review and approve the merger before it can take place and is still reviewing the case.  Given that the DOJ review is still outstanding, and many of their own PUCs have approved the merger, the state AGs should more appropriately address their concerns with DOJ and their own PUCs instead of wasting their taxpayers’ money by running to court.