RWA Urges DC District Court to Reject the DOJ Proposed Consent Decree and Deny T-Mobile/Sprint Merger

On October 11 the Rural Wireless Association filed comments under the Tunney Act review process with the DOJ explaining the ineffectiveness of the DOJ’s Proposed Final Judgement/Consent Decree in alleviating the anticompetitive effects of the T-Mobile/Sprint merger. The proposed merger, as specified in the proposed consent decree, will have a detrimental effect on both rural consumers and all Americans traveling in rural America in their pursuit to obtain adequate and affordable rural mobile wireless service coverage. The DOJ’s attempt to insert Dish into the fold as the “white-knight fourth nationwide competitor” will prove unfruitful in overcoming the barriers to entry for a new marketplace player. Standing up a facilities-based nationwide carrier from scratch is not for the faint of heart.  Given that nationwide carriers have had decades to provide nationwide facilities-based services, expecting Dish to be able to do so in less than 7 years and step into the shoes of Sprint, is unrealistic and belies credibility. Specifically, the pre-paid subscriber base Dish would acquire as part of the proposed fix will only grant it a small revenue stream that is insufficient and insufficiently predictable to be relied upon to be re-invested in a 5G network competing with the likes of AT&T, Verizon, and New T-Mobile. The fact that Dish is completely reliant on the New T-Mobile network and the wholesale pricing set by New T-Mobile, with no oversight by the Court leaves massive room for price manipulation.  Such barriers along with lackluster enforcement measures agreed to by DOJ create a scenario in which Dish would be better off biding its time, operating only as a MNVO, and then selling its spectrum at a later date rather than investing the tens of billions of dollars required to become a fourth nationwide facilities based carrier akin to Sprint.

With the elimination of Sprint as a reliable, stand-alone provider of domestic wholesale MVNO access and nationwide roaming services and the reliance on vastly undercapitalized newcomer Dish as the proclaimed fourth nationwide carrier, this Proposed Consent Decree fails to meet the public interest standard and thus under the Tunney Act review the DC District Court should reject it and protect American consumers from the irreversible damage this proposed merger will inflict.

2019-10-15T14:10:36+00:00 October 14th, 2019|Categories: Advocacy, Press Releases|
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