Digital Gabe
Cutting Edge Commentary On All Things Media

T-Mobile/Sprint Merger YoYo Continues

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For a few hours yesterday morning the executive teams at T-Mobile and Sprint must have been celebrating as the FCC Commissioners publicly announced their support for the proposed merger of the two telcos.  Then, like a wet towel, the DOJ killed excitement by announcing its plan to review the tie up.  Citing a person familiar with the DoJ’s ongoing merger review, “the remedies proposed by the companies don’t go far enough to resolve antitrust concerns.”

As part of the merger agreement T-Mo/Sprint agreed to a significant buildout of their 5G network within a specific time frame.  This was enough to satisfy the FCC, who has jurisdiction over the telco and internet industries, but apparently not enough for the DOJ.  Industry insiders are speculating that the DOJ is trying to appear as a “neutral industry watchdog” after its failed attempt to block the AT&T/Time Warner merger last year.  The DOJ was out of their legal depth in that case, and now needs to appear to be consistent as an anti-trust guardian against others in the space – including T-Mobile and Sprint.

At the end of the day it’s hard to imagine the #3 (T-Mo) and #4 (Sprint) telcos posing a monopolistic threat against the likes of Verizon and AT&T.  So the DOJ’s review will probably work itself out.  In the meantime, this is just one more headache (and delay) for the engaged companies.

 

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