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Posts Tagged ‘5G’
April 22nd, 2019 at 1:09 pm
WSJ Urges Regulators to Approve T-Mobile/Sprint Merger
Posted by Print

We at CFIF have steadfastly highlighted the consumer benefits of the proposed T-Mobile/Sprint merger, and cautioned the federal government against any pointless and destructive objection to the deal.  In today’s Wall Street Journal, its editorial board encourages the Department of Justice (DOJ) to move forward on the deal:

The Justice Department lost its lawsuit to block AT&T’s purchase of Time Warner.  Yet now the antitrust cops are holding up T-Mobile’s merger with Sprint even though it could give AT&T more competition in wireless.  What gives?

A year ago, T-Mobile announced plans to acquire Sprint for $26 billion in stock, yet the merger is still stuck in government antitrust purgatory.  The Federal Communications Commission keeps pausing its 180-day shot clock on the merger review to let staff and third parties dig through documents to trash the deal.”

The piece goes on to neatly summarize the benefits the merger would bring:

With more than 100 million customers, the new T-Mobile would be a stronger competitor to Verizon Wireless (118 million) and AT&T (94 million).  It would also offer a broader mix of spectrum that would improve service.  T-Mobile boasts low-band spectrum that increases coverage in rural areas.  Sprint is sitting on mid-band spectrum that can transmit more data at higher speeds in urban areas.”

Simply put, it’s time for regulators to approve the merger to release the fruits that it promises.

June 13th, 2018 at 3:01 pm
In Good News for Consumers, Federal Judge Rejects DOJ Attempt to Block AT&T/Time Warner Merger
Posted by Print

In a decision that came as no surprise but nevertheless merits celebration, a federal judge yesterday rejected the Justice Department’s needless lawsuit attempting to block AT&T’s acquisition of Time Warner.

Whenever federal bureaucracies seek to disrupt functioning markets by prohibiting mutual agreements between two willing parties, they carry a heavy burden of proof to establish impending consumer harm.  In this case, the opposite was true – the federal government’s needless interference, not the proposed acquisition, would result in consumer harm.  Accordingly, Judge Richard Leon ruled that Justice’s allegations “do not come close to answering the question before the Court.”

So why is yesterday’s ruling important going forward?  Hopefully, it provides federal bureaucrats an abject lesson against future destructive campaigns of a similar sort.

As one immediate example, consider the proposed merger between T-Mobile and Sprint announced recently.  Although the T-Mobile/Sprint proposal involves characteristics unique to it, it offers the consumer market similar sorts of benefits.

Namely, T-Mobile/Sprint prospectively offers an enhanced array of consumer services in comparison to what is available today.  For example, the two current companies’ differing but complementary assets would create a new network with enhanced capacity, wider coverage and more effective wireless performance for customers than currently exists.  It also promises network upgrades, lower prices and job creation.  In particular, the proposed merger offers significant potential benefits through deployment of the first 5G wireless network in the U.S.

Through that $40 billion investment in 5G, consumers will enjoy data delivery at a lower cost, and the incentive for competitors to similarly lower prices to consumers.  That will also prompt market competition to expand spectrum in rural areas in addition to urban centers, as well as capacity improvements for consumers.

That’s how market competition works.  A T-Mobile/Sprint merger and its 5G deployment would also mean billions in new private infrastructure investment and countless new jobs.  In contrast, the absence of a T-Mobile/Sprint merger would mean slower deployment of a 5G nationwide network, and the absence of a market competitor of greater scale.  Ultimately, that means consumers would lose.

The Trump Administration has demonstrated to date how deregulation can turbocharge the economy and benefit American consumers.  That logic applies with added potency to the ever-evolving telecommunications market, and the Justice Department should learn its lesson and refrain from future needless interference that will only cost consumers and trigger embarrassing legal defeats.