Senate Democrats urge rejection of T-Mobile, Sprint merger

Dive Brief:

Nine Senate Democrats — including several 2020 presidential contenders — signed a letter urging the Federal Communications Commission (FCC) and Department of Justice (DOJ) to reject a proposed merger between T-Mobile and Sprint. The merger, the Democrats write, is "likely to raise prices for consumers, harm workers, stifle competition, exacerbate the digital divide and undermine innovation."
The Senators say the $26 billion deal would stomp out innovation — including around 5G networks — and would limit options for rural customers.
The signatories included: Sens. Richard Blumenthal, D-CT; Cory Booker, D-NJ; Sherrod Brown, D-OH; Kirsten Gillibrand, D-NY; Amy Klobuchar, D-MN; Ed Markey, D-MA; Tom Udall, D-NM; Bernie Sanders, D-VT; and Elizabeth Warren, D-MA.

Dive Insight:

T-Mobile and Sprint have used 5G as a major selling point for the merger. In a filing with the FCC, the two said their 5G collaboration "would leapfrog Verizon and AT&T's networks," delivering faster data speeds to consumers at a lower cost, and expanding service into some rural areas. T-Mobile has also promised mobile broadband speeds in excess of 100 Mbps in 90% of the United States by 2024, assuming it can link with Sprint’s existing network.

However, the Senate letter says the government should "not be blinded by the glittery promise of nationwide 5G," and says the individual companies might actually be more aggressive and nimble without the merger. Even though T-Mobile CEO John Legere told Klobuchar during a Senate hearing that he would make new efforts to bring broadband to rural areas, the Democrats say the companies’ records show a lack of enthusiasm for rural investments. Rural America’s "best hope," they write, "is to preserve a competitive mobile market."

The Democratic-led House Energy & Commerce and Judiciary Committees will hold hearings this week on the proposed merger, following calls from consumer protection groups. With several declared and potential 2020 candidates signed onto the letter, the merger is likely to become a talking point on the campaign trail and in the Senate, especially if approved by the Trump administration.