US approves merger of T-Mobile and Sprint mobile operators

The US antitrust authorities approved Friday the merger of T-Mobile and Sprint for $ 26 billion, under an agreement between the third and fourth mobile operators, while the sector is moving towards the deployment of ultra-fast fifth generation (5G) networks.

The merger aims to create a powerful third US operator to compete with industry leaders, Verizon and AT & T, and accelerate the rollout of 5G, but consumer groups have complained of a reduction in competition and from a price increase.

The agreement provides for Sprint to sell some of its prepaid wireless business to the Dish Network satellite television operator, which would create its own telecommunication service.

"With this merger and the accompanying divestiture, we are significantly increasing production by ensuring that large amounts of currently unused or underutilized spectrum are made available to US consumers in the form of 5G networks. high quality, "said Makan Delrahim, head of the Ministry of Justice. Antitrust Division (DoJ & # 39; s).

Delrahim added that the deal would provide Dish with the resources needed to "provide a full range of mobile wireless services across the country."

T-Mobile, whose parent company is a German company, Deutsche Telekom, and Sprint, controlled by the Japanese company SoftBank, said the merger would benefit consumers.

It will create "a bigger and bolder competitor than ever – a network that will provide the country's most transformative 5G network, lower prices, better quality, unmatched value and thousands of jobs," said John Legere , CEO of T-Mobile. retains its position after the merger.

"Today's results are good for everyone. We look forward to putting this new pro-consumer and competitive T-Mobile 5G network to work for US customers from coast to coast to coast. "

Sprint's executive chairman, Marcelo Claure, said the merger "will allow the US to compete fiercely for leadership in 5G" and that the merged company will build "one of the most advanced 5G networks in the world." world, which will radically revolutionize the way consumers and businesses use their resources. " connected devices to improve their daily life.

During a teleconference, Legere told badysts that he expected regulatory approval to be completed soon and that the merger be completed by the end of the year. # 39; year.

Higher prices?

Earlier this year, 14 states filed lawsuits to block the deal. The Justice Department said that five of them had accepted the settlement, which still needs to be approved by the court.

New York State Attorney General Letitia James said a group of state regulators would continue its efforts to block the merger.

"The coalition today reaffirmed its commitment to oppose this merger, which would reduce competition and increase prices for consumers," James said in a statement.

Legere stated that the companies were "willing to engage" with the opponents and that "our intention is not to close the debate as long as the dispute is ongoing".

Joshua Stager, of the New America Foundation's Open Technology Institute, said the deal did not keep four "viable competitors" for the sector, adding that the sale of badets to Dish was "unnecessarily complicated."

"The DoJ does not need to go out of their way to repair a bad merger. It can simply block the transaction, "he said.

Avery Gardiner, an antitrust fellow at the Center for Democracy & Technology, said the decision to approve the deal "went against decades of well-established principles" of competition.

"The wireless industry is already highly concentrated and this agreement is likely to result in higher prices, calcified cell service plans and lower overall quality," she said.

Chris Shelton, president of the union of communication workers of America, said that this merger would cut 30,000 jobs and would make Dish a reseller of services on the T-Mobile network rather than a true rival.

But Jessica Melugin of the Competitive Enterprise Institute said that the deal would be positive for consumers by allowing three powerful operators of 5G.

She added that without the government, consumers would benefit from the wireless innovations they deserved in an unhindered market.

Dish Network, which operates satellite and satellite television systems, announced that it would deploy a 5G broadband network capable of serving 70% of the US population by June 2023.

Dish will move away from the wireless spectrum as part of the transaction, as well as prepaid activities from Sprint, Boost Mobile, Virgin Mobile and Sprint Prepaid.