Judge approves $26 billion merger of T-Mobile and Sprint:
Shares of Sprint soared Tuesday after a U.S. District judge ruled in favor of its $26 billion deal to merge with T-Mobile.
The stock was up 75% Tuesday morning. It had risen after hours Monday after The Wall Street Journal reported the judge was expected to rule in favor of the deal. Shares of T-Mobile were up 10%.
The ruling clears one of the final hurdles for the deal, which still can't close until the California Public Utilities Commission approves the transaction. Tuesday's ruling also culminates a years-long courtship between Sprint and T-Mobile, which have made multiple attempts over the years to merge, only to abandon their plans fearing regulatory scrutiny.
Attorneys general from New York, California, Connecticut, Hawaii, Illinois, Maryland, Michigan, Minnesota, Oregon, Wisconsin, Massachusetts, Pennsylvania, Virginia and D.C. originally brought the lawsuit to block the deal following approval from the Justice Department of Federal Communications Commission. The states had argued that combining the No. 3 and No. 4 U.S. carriers would limit competition and result in higher prices for consumers. The companies had argued their merger would help them compete against top players AT&T and Verizon and advance efforts to build a nationwide 5G network.
In his decision filed Tuesday, Judge Victor Marrero wrote, "The resulting stalemate leaves the Court lacking sufficiently impartial and objective ground on which to rely in basing a sound forecast of the likely competitive effects of a merger."
The judge laid out three points on which the court rejected the states' objections to the merger. First, he said, they failed to convince the court that the merged party "would pursue anticompetitive behavior that, soon after the merger, directly or indirectly, will yield higher prices or lower quality for wireless telecommunications services."
Second, the court rejected that Sprint would be able to continue operating effectively as a wireless services competitor without the merger.
"The Court is thus substantially persuaded that Sprint does not have a sustainable long-term competitive strategy and will in fact cease to be a truly national [mobile network operator]," the ruling said.
And finally, the court rejected the states' argument that Dish Network "would not enter the wireless services market as a viable competitor nor live up to its commitments to build a national wireless network." The deal called for Dish to step in as a new wireless player based on agreements with the DOJ and FCC. Shares of Dish were up 11% on the judge's ruling.
In a statement following the ruling, New York Attorney General Letitia James, who helped lead the states' push, said the states "disagree with this decision wholeheartedly, and will continue to fight the kind of consumer-harming megamergers our antitrust laws were designed to prevent." She called the ruling and called it a "loss" for Americans who rely on wireless networks and said the states will review their options, including a potential appeal.
[...] If approved by the California commission, the deal would create a new wireless competitor in Dish, which has tried for years to become a provider, spending billions on airwaves it has stored away. Under a previous deal between Dish and the DOJ and FCC, the company had a deadline this year to build a narrowband internet of things (IoT) network connecting "people and sensors and microprocessors." If the deal clears, Dish will instead focus its efforts on building a 5G network covering 20% of the country by June 2022 and 70% of the U.S. population by June 2023, with the consequence of facing a $2.2 billion payment to the U.S. Treasury if it fails to live up to its commitments.
Legere, the T-Mobile CEO, announced last year he would step down from the role and be succeeded by President and COO Mike Sievert. Legere had been expected to step down once the company's merger with Sprint was completed. Sprint and T-Mobile had initially said Legere would lead the combined company when they announced their intention to merge in April 2018.
Previously:
T-Mobile Continues to Rack Up Customers
U.S. Justice Department and FCC Fight State Effort to Block Merger of Sprint, T-Mobile
John Legere, T-Mobile's Brash "Un-Carrier" Chief, to Leave in May 2020
FCC Formally Approves the T-Mobile-Sprint Merger
It’s Official: US Government Approves T-Mobile/Sprint Merger
DOJ to Approve T-Mobile/Sprint Merger Despite 13 States Trying to Block It
Sprint Customer Accounts Breached By Hackers
T-Mobile/Sprint Merger Faces Big Test as Nine States Sue to Block It
DOJ Leans Against Approving T-Mobile's Takeover of Sprint
AT&T Settles 5Ge False Advertising Lawsuit With Sprint
T-Mobile/Sprint Merger is in Danger of Being Rejected by DOJ
Related Stories
Submitted via IRC for SoyCow1984
Mobile carriers face skeptical regulators in attempt to obtain merger approval.
T-Mobile US and Sprint are facing potential rejection of their proposed merger at the US Department of Justice.
DOJ [(US Department of Justice)] staffers "have told T-Mobile US and Sprint that their planned merger is unlikely to be approved as currently structured," The Wall Street Journal reported today, citing people familiar with the matter.
"In a meeting earlier this month, Justice Department staff members laid out their concerns with the all-stock deal and questioned the companies' arguments that the combination would produce important efficiencies for the merged firm," the Journal wrote.
[...] T-Mobile CEO John Legere denied the Journal report, writing on Twitter that "[t]he premise of this story... is simply untrue. Out of respect for the process, we have no further comment." Sprint Executive Chairman Marcelo Claure also claimed that the "article is not accurate," adding that Sprint "continue[s] to have discussions with regulators about our proposed merger."
[...] The Justice Department's antitrust division is reviewing the merger and could file a lawsuit in federal court in an attempt to block the deal. Success isn't guaranteed, a fact the DOJ was reminded of when a US District Court judge allowed AT&T to buy Time Warner despite DOJ opposition.
The DOJ could also approve the merger with conditions, but that would require agreement with T-Mobile and Sprint on what those conditions would be.
[...] T-Mobile has spent at least $195,000 at President Trump's hotel in Washington, DC while lobbying for Trump administration approval of the merger.
[...] The T-Mobile/Sprint deal would reduce the number of nationwide mobile carriers from four to three, limiting customer choice across the United States. T-Mobile and Sprint are smaller players in a market led by Verizon and AT&T, but T-Mobile has surged in recent years by offering more customer-friendly deals than the two biggest carriers.
AT&T settles 5G E false advertising lawsuit with Sprint
Sprint and AT&T on Monday reached a settlement -- characterized by both as "amicable" -- over a lawsuit in which Sprint claimed its rival carrier used "numerous deceptive tactics to mislead consumers" with its "5G E" branding.
[...] News of the settlement was first reported by the site Law360, but the details haven't been released.
DOJ Leans Against Approving T-Mobile's Takeover of Sprint:
The Justice Department is leaning against approving T-Mobile US Inc.'s proposed takeover of Sprint Corp., according to a person familiar with the review, even after the companies won the backing of the chairman of the Federal Communications Commission.
The remedies proposed by the wireless carriers earlier Monday don't go far enough to resolve the department's concerns that the deal risks harming competition, said the person, who asked not to be named because the investigation is confidential.
Opposition to the deal by the Justice Department's antitrust chief, Makan Delrahim, would mark a rare break with the FCC. The two agencies work side by side on merger reviews and typically emerge on the same page about whether to approve deals.
Earlier on Monday, FCC Chairman Ajit Pai said he would recommend approval of T-Mobile's $26.5 billion deal for Sprint after the companies offered a package of concessions, including spinning off Sprint's Boost pre-paid brand, to win regulators' blessing.
[...] More than a dozen states attorneys general are also investigating the deal and have raised concerns about harm to consumers. The states have signaled they may sue to block the deal even if the Justice Department clears it.
Submitted via IRC for Bytram
T-Mobile/Sprint merger faces big test as nine states sue to block it
Nine states and the District of Columbia today filed a lawsuit against T-Mobile and Sprint in an attempt to stop the wireless carriers from merging.
New York Attorney General Letitia James and California AG Xavier Becerra are leading the way, with co-plaintiffs from Colorado, Connecticut, the District of Columbia, Maryland, Michigan, Mississippi, Virginia, and Wisconsin.
"When it comes to corporate power, bigger isn't always better," James said in an announcement of the lawsuit. "The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans, but would particularly affect lower-income and minority communities here in New York and in urban areas across the country. That's why we are going to court to stop this merger and protect our consumers, because this is exactly the sort of consumer-harming, job-killing megamerger our antitrust laws were designed to prevent."
Becerra argued that the "merger would hurt the most vulnerable Californians and result in a compressed market with fewer choices and higher prices."
The AGs filed their complaint in US District Court for the Southern District of New York.
Sprint customer accounts were breached via a Samsung web page.
The hack occurred June 22, Sprint told its customers in a letter, and included details like first and last name, billing address, phone number, subscriber ID, account number, device type, device ID, monthly charges, account creation date, upgrade eligibility and any add-on services. It occurred via the Samsung "add a line" website.
"No other information that could create a substantial risk of fraud or identity theft was acquired," Sprint said. The carrier added it has "taken appropriate action" to secure all accounts, and hasn't found any fraudulent activity resulting from the breach.
Sprint said it notified customers on June 25 of a PIN reset "just in case" their PIN had been compromised. In,[sic] Sprint was also breached via its Boost Mobile prepaid subsidiary -- it said hackers used Boost phone numbers and Boost.com PIN codes to gain access to Sprint accounts.
"Information such as customers' account Personal Identification Numbers (PINs) may have been compromised, however credit card and social security numbers are encrypted and were not compromised," Sprint told CNET in an emailed statement.
Submitted via IRC for Bytram
DOJ to approve T-Mobile/Sprint merger despite 13 states trying to block it
The Justice Department plans to approve the T-Mobile/Sprint merger as part of a settlement involving the sale of spectrum licenses, wholesale access, and a prepaid wireless business to Dish Network, The Wall Street Journal reported today.
"The companies have spent weeks negotiating with antitrust enforcers and each other over the sale of assets to Dish to satisfy concerns that the more than $26 billion merger of the No. 3 and No. 4 wireless carriers by subscribers would hurt competition," the Journal wrote, citing people familiar with the matter.
As a result of those negotiations, the DOJ is "poised to approve" the merger and could announce a settlement with T-Mobile and Sprint "as soon as this week, but the timing remains uncertain," the Journal wrote.
Even if the DOJ approves the merger, T-Mobile and Sprint will still have to defend it in court because of a lawsuit filed against them by 13 states and the District of Columbia.
Would you rather they each fail and get gobbled up by AT&T and Verizon, or join forces to have a chance to compete against them... and join in a battle against the the consumer?
Submitted via IRC for Bytram
It's official: US government approves T-Mobile/Sprint merger
The Justice Department today announced its approval of the T-Mobile/Sprint merger as part of a settlement that requires the merging companies to spin off several assets to Dish Network.
The DOJ decided against filing a lawsuit to block the T-Mobile US purchase of Sprint, even though it reduces the number of major mobile network providers from four to three. In exchange for its approval, the DOJ convinced the companies to sell Dish spectrum licenses, wholesale network access, and Sprint's prepaid business including subsidiaries Boost Mobile and Virgin Mobile. Boost and Virgin both resell Sprint network access instead of operating their own networks.
Dish would use its newfound assets to resell T-Mobile/Sprint service and to build its own network. The building-its-own-network part is far more crucial for Dish to effectively replace the competition eliminated by the merger, but this is expected to take several years.
The DOJ's approval is not the last one T-Mobile and Sprint need, because 13 states and the District of Columbia sued the companies to block the merger.
FCC formally approves the T-Mobile-Sprint merger
Today, the Federal Communications Commission (FCC) formally approved the T-Mobile-Sprint merger. The decision comes after a drawn-out, and at times contentious, review of T-Mobile's $26.5 billion bid to merge with Sprint.
The FCC believes the deal will close the digital divide and advance 5G in the US. T-Mobile and Sprint have committed to deploying 5G service to cover 97 percent of Americans within three years. They've also pledged to provide 90 percent of Americans with access to mobile service with speeds of at least 100 Mbps within six years. The FCC's approval is conditional on those promises, and the parties could be fined over $2 billion if they don't meet those goals.
John Legere Leaving T-Mobile After 7 Fun Years of Bashing AT&T:
T-Mobile CEO John Legere will leave the company's top job after his contract runs out on April 30, 2020, T-Mobile announced today. Mike Sievert, T-Mobile's president and chief operating officer, will replace Legere as CEO on May 1.
Legere, who became CEO in September 2012, revived a struggling company and led the "Un-carrier" strategy that pitched T-Mobile as a customer-friendly alternative to the AT&T/Verizon duopoly. T-Mobile's Un-carrier moves changed some of the punitive business practices that mobile carriers routinely inflicted on customers.
But Legere's T-Mobile also helped lead the way in making throttling of streaming video a standard industry practice. T-Mobile was punished by the federal government in 2016 for failing to adequately disclose speed and data restrictions on its "unlimited data" plans, and like other carriers, it sold its customers' real-time location data to third parties. Legere often offered better deals than competitors, but US wireless prices still rank among the most expensive in the world.
Legere used a brash and combative style to promote T-Mobile, often insulting larger rivals AT&T and Verizon by calling them "Dumb and Dumber." In 2017, he said that T-Mobile's scientific research found that Verizon was the "Dumber" part of that pair. Legere will leave as T-Mobile attempts to complete its pending acquisition of Sprint, a deal that would reduce wireless competition in the US and make T-Mobile roughly the same size as AT&T and Verizon.
Legere helped T-Mobile and Sprint win the Federal Communications Commission and Department of Justice's approval of the merger, but the companies must still defeat a lawsuit filed by a coalition of state attorneys general in order to complete the merger.
The Sprint/T-Mobile merger may reduce competition, but if Sprint instead declared bankruptcy, then wouldn't the larger AT&T and Verizon be likely to outbid T-Mobile for Sprint's spectrum licenses leaving T-Mobile even less able to compete?
Also at: c|net.
U.S. Justice Department and FCC fight state effort to block merger of Sprint, T-Mobile:
WASHINGTON (Reuters) - The U.S. Justice Department and Federal Communications Commission filed in court on Friday to support a merger of T-Mobile (TMUS.O) and Sprint (S.N), the third- and fourth-largest wireless carriers.
A group of state attorneys general has asked a judge to stop the $26 billion deal, saying it would lead to higher prices for customers. The case is being heard in federal court in New York and could wrap up on Friday.
In their filing, the Justice Department and FCC argued that if the states, led by New York and California, succeed in killing the deal the end result will be that rural areas of the United States will be slower to get access to 5G, the next generation of wireless.
“Specifically, T-Mobile has committed to providing 5G coverage to 85% of the rural population within three years, and 90% of the rural population within six years,” the agencies said in the filing.
Who would have thought that providing good service at a reasonable price could be good for business?
T-Mobile continues to rack up customers:
As T-Mobile waits to hear whether it'll be able to consummate its marriage with Sprint, the company is still racking up new customers. T-Mobile also beat analysts' expectations for revenue and profit when it reported quarterly earnings Thursday.
The third-largest U.S. wireless carrier by subscribers said it added 1 million new postpaid customers, or customers who pay their bills at the end of the month. Such customers are considered valuable in the wireless industry. The figure was in line with estimates from research firm FactSet.
[...] T-Mobile's strong growth is in stark contrast to that of Sprint, which has been limping along, losing customers and generating less revenue than analysts had expected. During the fourth quarter, Sprint reported it had [lost] 115,000 postpaid phone subscribers.
T-Mobile's subscriber growth in the fourth quarter is also outpacing that of rivals AT&T and Verizon. Last week, AT&T said it had added 229,000 postpaid mobile phone subscribers during the fourth quarter. Verizon added 790,000 new postpaid phone subscribers in the fourth quarter.
(Score: 5, Insightful) by Thexalon on Wednesday February 12 2020, @02:46PM (20 children)
Bills will go up, service will get worse, Wall Street will cheer even more.
Because that's what happens when competition is reduced, and that was the purpose of this move, regardless of what they told the regulators.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 2) by zoward on Wednesday February 12 2020, @04:09PM (13 children)
In all fairness, T-Mobile is the cheapest and generally considered "most decent" of the three top US carriers (although admittedly that's not a high bar to clear). In the best of all worlds, it would mean T-Mobile users would have a better coverage map. In the worst, well, the parent will have hit the nail on the head. As a (relitavely happy) T-Mobile customer, I'm rotting for the former.
(Score: -1, Offtopic) by Anonymous Coward on Wednesday February 12 2020, @04:21PM
Worst case scenario: seagulls all get handguns.
(Score: 1) by fustakrakich on Wednesday February 12 2020, @04:25PM
I'm rotting for the former.
Slowly but surely aren't we all!
And to think, the great power we really do have to undo it all will again be squandered in primal rage.
La politica e i criminali sono la stessa cosa..
(Score: 2) by Thexalon on Wednesday February 12 2020, @08:25PM (10 children)
I'm a T-Mobile customer as well. I picked it in large part because its market power was the least, and thus it was more likely to make efforts to keep prices down and provide good service.
I'm guessing that will change now that it has more customers and reduced competition. Because regardless of what you're rooting for, what shareholders are expecting is that the new company will be more profitable, and that means fleecing customers.
The only thing that stops a bad guy with a compiler is a good guy with a compiler.
(Score: 1, Insightful) by Anonymous Coward on Wednesday February 12 2020, @08:31PM
Anybody that thinks this is going to be good for the customers should be pilloried in the town square.
The correct solution to the lack of competition would be to break up both AT&T and Verizon to create additional competition, not to allow the 3rd and 4th place carriers to merge. Or better still, separate the individuals that own and control the infrastructure into a public, non-profit utility that the carriers are able to lease capacity from.
It's not much of a surprise that this would go through, it's been decades since any meaningful antitrust enforcement was done. Not to mention the near complete lack of enforcement of white-collar crimes in general.
(Score: 0) by Anonymous Coward on Wednesday February 12 2020, @10:25PM (8 children)
Perhaps those that want these companies to be more consumer friendly should buy their stock and vote. The techies here have money and collectively you can change the outcome of who is in charge. Worst case scenario you benefit from the lack of competition (you can use the money you make in other ways to benefit the world as well) and best case scenario you benefit and you exercise voting power to make these companies more consumer friendly. I believe there are organizations that buy stock in companies in order to exercise their voting power in ways that cause them to act more ethically.
As an investor you can find ways to leverage the money you make from these companies to better the world. You can try to leverage your voting power as well. You want to change the game you need to play by the rules. The rules are that investors are the ones with influence and money. Become the investor that influences laws and corporate policy so that corporations act more ethically.
(Score: 2) by PartTimeZombie on Wednesday February 12 2020, @11:46PM (7 children)
That's nice thought, but you'll be voting against higher profits, and guess what the other shareholders want?
Good luck buying a majority interest in T-Mobile.
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @12:32AM (6 children)
It's not a perfect strategy but you gotta start somewhere. Of course your vote will not completely dominate the decision making processes but if there are enough of you that own shares and vote then your vote may at least be heard and have some impact.
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @12:36AM (5 children)
You can start somewhere by refusing to vote for politicians that are taking corporate money. Which is not easy, given how few races have any politicians that are refusing the money, but when they exist, voting for them is an imperative.
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @12:41AM (4 children)
Agreed, this is another part of the solution. The problem needs to be attacked from multiple different angles and that includes
A: voting for the right politicians
B: Owning shares in various companies and using your ownership to vote in ways that make them act more ethically.
These are just two of the things that need to be done and there are other angles to attack from as well.
The first past the post voting system needs to go away as well. As others have mentioned on this blog in the past we need to have an alternative voting system that promotes third parties.
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @12:55AM
These two videos are informative
The Problems with First Past the Post Voting Explained
https://www.youtube.com/watch?v=s7tWHJfhiyo [youtube.com]
The Alternative Vote Explained
https://www.youtube.com/watch?v=3Y3jE3B8HsE [youtube.com]
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @04:35AM (2 children)
FPP isn't the real problem, fixing it is a possible response to the problem, but if you've still got the same selection of corrupt politicians on offer, changing the method by which they're chosen is more or less just rearranging deck chairs.
It may help somewhat with the number of politicians that need to be bribed, but in most cases, the contribution limits are on a per candidate basis anyways.
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @06:59PM (1 child)
FPP is only part of the problem, the problem has many other parts as well.
(Score: 0) by Anonymous Coward on Thursday February 13 2020, @07:03PM
If it were up to me I would have them implement a cryptographic voting system of some sort (end to end user verified cryptographic voting system) but the problem is that such a system is way too beyond the general public's ability to understand to get them to rally behind it.
(Score: 2) by DannyB on Wednesday February 12 2020, @04:52PM (5 children)
And Starlink will, um, something.
The lower I set my standards the more accomplishments I have.
(Score: 2) by Freeman on Wednesday February 12 2020, @05:13PM (4 children)
I'd be pleasantly surprised, if Starlink cuts in on the cellphone market. Right now, I'm just hoping they'll have a positive impact on the ISP market.
Joshua 1:9 "Be strong and of a good courage; be not afraid, neither be thou dismayed: for the Lord thy God is with thee"
(Score: 2) by DannyB on Wednesday February 12 2020, @06:22PM (3 children)
Good enough ISP service is effectively a secondary type of "cell phone" service. There are internet based ways of doing "phone call" like things. Further, you can actually get some cell service over an internet connection. And I think there are probably VOIP services available over the net. Didn't Google even offer some type of internet based phone with a real phone number?
The lower I set my standards the more accomplishments I have.
(Score: 2) by Freeman on Wednesday February 12 2020, @09:11PM (2 children)
There's definitely VOIP solutions, but that's still more of a fringe or enterprise solution. Also, there doesn't seem to be much of a roaming kind of capability with Starlink. I would definitely love to see an internet anywhere kind of thing, but that's still relegated to cell phones with tethering or the like.
Joshua 1:9 "Be strong and of a good courage; be not afraid, neither be thou dismayed: for the Lord thy God is with thee"
(Score: 2) by DannyB on Wednesday February 12 2020, @09:21PM (1 child)
I don't see any obvious reason why Starlink ground equipment couldn't be designed to roam. Even if initial versions of equipment does not do so.
It would seem that having non-fringe internet "phone" service is a matter of someone building an extremely easy to use app that is as simple as your cell phone dialer app.
The lower I set my standards the more accomplishments I have.
(Score: 2) by Freeman on Wednesday February 12 2020, @10:52PM
That and the need to provide 911 service. Maybe not all, but it's certainly common for VOIP services to not provide 911 service.
Joshua 1:9 "Be strong and of a good courage; be not afraid, neither be thou dismayed: for the Lord thy God is with thee"
(Score: 0) by Anonymous Coward on Wednesday February 12 2020, @02:52PM
Less competition == less downward pricing pressure
Consolidation (sung to the tune of Anticipation* [youtube.com]:
Consolidation, consolidation is making me pay
It's charging me more.
And tomorrow, the profits will be great!
I'm a customer, and my bank account grows smaller
[...]
These are the ways we pay!
These are the ways we pay!
These are the ways we pay!
*Damn, she's got big teeth!