FCC Formally Grants Approval of Merger of Sprint and T-Mobile, Lawsuit From 13 State Attorneys General Still Pending

The U.S. Federal Communications Commission on Tuesday granted formal approval for the $26 billion merger between Sprint and T-Mobile. The approval was the last regulatory approval the merger required to move forward.

Yesterday’s FCC filing means the two carriers will be allowed to merge and become known as “New T-Mobile.” The Department of Justice approved the merger back in July.

The approval came after a 3-2 vote in favor, with the vote coming down along party lines, with bot Democrats voting against it.

FCC chief Ajit Pai released a statement on the merger, saying the deal would be good for consumers and the U.S. overall:

“It would bring the benefits of the next generation of wireless technology to American consumers and advance American leadership in 5G. It would help millions in rural America benefit from high-speed 5G mobile broadband service… and it would promote competition.”

However, FCC Commissioner Jessica Rosenworcel dissented voices, arguing the consolidation of the two carriers would likely result in higher prices and poorer service for the majority of customers:

“We’ve all seen what happens when market concentration increases following a merger. A condensed airline industry brought us baggage fees and smaller seats, even as the price of fuel fell. A condensed pharmaceutical industry has led to a handful of drug companies raising the prices of lifesaving medications, taking advantage of those struggling with illness. There’s no reason to think the mobile-phone industry will be different.”

The two companies have committed to creating a nationwide 5G network that will cover 97% of the U.S. population within three year, covering 99% within six years. The carriers have also promised not to raise prices for three years following the finalization of the merger.

The FCC wants to keep things competitive, making move to ensure Dish will become the fourth major wireless carrier in the U.S. Dish plans to deploy a 5G broadband network covering 70% of the U.S. population by June 2023.

Following completion of the merger of Sprint and T-Mobile, Dish will:

• Acquire Sprint’s prepaid businesses and customers, including Boost Mobile, Virgin Mobile and the Sprint-branded prepaid service.
• Acquire 14 MHz of Sprint’s nationwide 800 MHz spectrum.
• Access the New T-Mobile network for seven years, including the ability to serve DISH customers seamlessly between T-Mobile’s nationwide network and DISH’s new independent 5G broadband network.

Sprint and T-Mobile still face a final hurdle before things are finalized, as the transaction still faces a lawsuit filed by a coalition of over a dozen state attorneys general, arguing that the merger is not in the public interest, remains on the docket.

T-Mobile and Sprint says they anticipate the merger closing by the end of the year.