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Ten state attorneys general are suing T-Mobile and Sprint to try to block their merger.
Mark Lennihan / AP
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Mark Lennihan / AP
Ten state attorneys general are suing T-Mobile and Sprint to try to block their merger.
Mark Lennihan / AP
Ten state attorneys general have taken legal action to try to block the merger of telecommunications giants T-Mobile and Sprint.
"As far as corporate power is concerned, bigger is not always better," said Attorney General of New York State, Letitia James, in a statement. "The merger between T-Mobile and Sprint would cause irreparable harm to mobile subscribers across the country by cutting access to affordable and reliable wireless services to millions of Americans, but would particularly affect minority and low-income communities here in New York and in urban areas across the country. "
James is leading the lawsuit with California Attorney General Xavier Becerra. They sued T-Mobile, Sprint and their majority shareholders in a federal court in the Southern District of New York on Tuesday. Attorneys General of Colorado, Connecticut, Maryland, Michigan, Mississippi, Virginia, Wisconsin and Washington, DC also joined the suit.
The companies did not immediately respond to NPR's request for comment regarding the lawsuit.
The proposed merger, which has been underway for years, would reduce the number of major wireless carriers in the United States from four to three (including AT & T and Verizon).
Last month, the chairman of the Federal Communications Commission, Ajit Pai, declared that he had approved the union after the two companies had accepted a set of concessions. T-Mobile and Sprint have agreed not to raise prices for three years, improve their broadband service, especially in rural areas, and accelerate the deployment of a 5G mobile network covering the vast majority of the United States. The companies also agreed to sell the prepaid brand Boost Mobile.
Concessions also included penalties if they did not follow.
Although Pai has blessed the merger, it has not yet been formally approved by the FCC. The Antitrust Division of the Department of Justice also reviews the agreement.
T-Mobile and Sprint have already argued that the combination would allow them to innovate in ways that benefit consumers.
But state attorneys general say they have doubts. "This merger would hurt the most vulnerable Californians and create a compressed market with fewer choices and higher prices," Becerra said in a statement. Attorneys General stated that the companies had not yet "planned to build new cell sites in areas that would otherwise not be served by T-Mobile or Sprint".
In the complaint, the complainants argue that competition between Sprint and T-Mobile has "resulted in lower prices, higher quality of service and more features for consumers". According to the complaint, if they merge, it would be a brake on innovation.
It should be noted that not all experts agree that the merger would ultimately result in higher prices. Last month, Roger Entner, founder of telecommunications analytics company Recon Analytics, said, "I do not think it will make a significant difference in prices in the future."
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