T-Mobile-Sprint Merger Receives Surprising Apathy to FCC

T-Mobile-Sprint Merger Receives Surprising Apathy to FCC

posted Saturday Sep 1, 2018 by Scott Ertz

T-Mobile-Sprint Merger Receives Surprising Apathy to FCC

Whenever a merger is proposed, there will always be opposition, no matter how innocuous the transaction seems. Whether it be the federal government questioning the validity of the merger, local government unhappy with the results, competitors afraid of the competition or interest groups who fear change, you can be certain that someone will object. The important question is always, how many of these oppositions will have an effect on the proposal.

For the most part, the organizations that will always object will usually be ignored. It's the modern version of The Boy Who Cried Wolf, where regulators can never tell if the threat being posed is credible because the organization is always claiming false threats. In addition, organizations, like competitors, who have a vested interest in the failure of the merger, will likewise usually be ignored. Impartiality is nearly impossible when it's in your best interest to sabotage.

The most recent merger announcement of Sprint and T-Mobile, which was rumored for over a year and announced in August, was bound to draw attention. After all, the failed AT&T/T-Mobile merger was one of the most watched merger processes of the decade. Following the announcement, the FCC received over 500 filings in regards to the proposition, and the results have been surprising. As expected, the normal groups opposed it, but we know the FCC doesn't take that too seriously.

What is surprising is the lack of objections from some of the sources you would expect. Most surprisingly, consumers seem to be excited about this merger. This merger would take the #3 and #4 US wireless carriers and turn them into the #2 wireless carrier, behind Verizon. With Sprint and T-Mobile's history of creating low-priced subscriptions that consumers like, the combined company seems to excite consumers, who overwhelmingly support the merger.

In addition to consumers, competitors seem to have no vocal opposition to the merger. Verizon and AT&T, who would be displaced from their #2 position if the merger is finalized, seem to have taken no position on the merger at all. That speaks volumes, considering competitors, especially ones who will lose their market position, usually find something to object about in these cases. This merger, however, seems to have either left them speechless or with nothing to take issue about.

This is not to say there is no opposition. Dish Network filed a complaint, claiming that if the merger is approved, they will have trouble purchasing components to build their own wireless network.

While DISH plans to aggressively upgrade and expand that network to full 5G in the future, the timing of the transition will crucially depend on, among other things, scarce inputs (e.g., radios, devices and chipsets) that the merger could make scarcer still.

This complaint is unlikely to make a difference, however, as the manufacturers of those components are unlikely to let a sale get away and will simply make more of the needed components. This will not be an easy merger, but with so little opposition from outside of the government, it will be far easier than T-Mobile's last try.

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