America’s major wireless services providers could be reduced to a big three if a merger deal announced this weekend between Sprint and T-Mobile is allowed to proceed.
The two wireless giants announced on Sunday they’d made a deal for T-Mobile to buy Sprint in a stock swap worth about $26 billion, with T-Mobile at the helm of the combined company.
The Wall Street Journal reports that the deal would put the new company on par in terms of customers with the nation’s top two wireless providers, Verizon and AT&T respectively, with their combined wireless customers totaling around 100 million to Verizon’s reported 116 million at the end of last year and AT&T’s 93 million.
It’s not the first time the two companies have tried to join forces. A proposed merger was shot down in 2014 by Obama administration regulators who argued that the wireless industry required four national provider to ensure competition. There are similar concerns this time about how the merger could hurt competition in the wireless service provider sector. This time around, executives for Sprint and T-Mobile with wireless providers are expected to argue that with wireless providers looking to make the shift from 4G to 5G technology, it will be hard to draw lines between what is a wireless provider and what is a cable company, and that there will be more than three or four players involved.
How does this deal potentially shake up the wireless industry? What kind of regulatory and/or antitrust hurdles might the deal face moving forward?
David Turetsky, former deputy assistant attorney general for civil and regulatory in the antitrust division of U.S. Department of Justice (1993-1997) and former bureau chief of the Public Safety and Homeland Security Bureau at the Federal Communications Commission (2012-2013); he is currently a visiting assistant professor at the University of Albany