Today, the Department of Justice announced its decision to let the proposed merger of T-Mobile and Sprint go forward, despite concerns that the transaction would reduce competition in the wireless sector. Those two wireless carriers are currently the third and fourth largest cell phone companies in America.
“By failing to block this deal, the federal government is hurting American consumers, who rely on mobile connectivity every day. There is a ton of innovation that can only happen if we have vibrantly competitive wireless networks that bridge the digital divide,” said Avery Gardiner, CDT’s Senior Fellow for Competition, Data & Power. She continued, “We are disappointed with DOJ’s decision, which goes against decades of settled principles for merger review. The wireless industry is already highly concentrated, and this deal is likely to result in higher prices, calcified cell service plans, and lower quality all around.”
DOJ’s decision requires the divestiture of certain brands and spectrum to Dish, a satellite television provider. “The notion that Dish, which has talked of building a wireless network but has been sitting on valuable wireless spectrum for years without doing anything with it, will promptly restore competition is fanciful,” added Gardiner. “We all benefit when we have competition and choices, and DOJ is falling down on the job by not protecting American consumers from this unprecedented market concentration in wireless services.”
CDT previously praised the decision by over a dozen state Attorneys General to sue to block this transaction. That case is currently pending in federal court in New York. DOJ’s proposed settlement is being filed in federal court in DC.