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Michigan AG Nessel: T-Mobile/Sprint Megamerger Remains a Bad Deal for Consumers, Innovation and Workers

LANSING  Michigan Attorney General Dana Nessel joined 13 other Attorneys General from across the nation today expressing concern about the U.S. Department of Justice’s newly announced T-Mobile/Sprint megamerger deal.

“Our position has not changed. We cannot sit idly by while two of the biggest companies in the country attempt to join forces, eliminating competition and driving up costs for consumers,” said Nessel.  “Once again, the American consumer comes second to big business for the Trump administration.”

The Attorneys General filed a complaint blocking the merger in the U.S. District Court for the Southern District of New York in June. The coalition alleged that the merger of two of the four national mobile network operators would harm mobile subscribers nationwide by reducing access to affordable, reliable wireless service, and would especially impact low-income and minority consumers who rely on prepaid services.

The coalition today reaffirmed its opposition to the merger, which reduces competition and increases prices for consumers.

T-Mobile currently has more than 79 million subscribers and is a majority-owned subsidiary of Deutsche Telekom AG, a German company. Sprint Corp. currently has more than 54 million subscribers and is a majority-owned subsidiary of SoftBank Group Corp, a Japanese company.

The Department of Justice indicated earlier today it would approve the merger of T-Mobile and Sprint based on speculative promises made by the two companies and a buyer, including an agreement to divest Sprint’s prepaid subscription service and potentially a slice of its wireless spectrum to satellite TV operator DISH. Though DISH has never owned any kind of mobile wireless business and has no experience building or operating a nationwide mobile wireless network despite already owning some valuable spectrum, both T-Mobile and Sprint claim this deal will create a fourth national network operator that will preserve a competitive market for consumers.

Nessel and her colleagues continue to have serious concerns with the merger and whether the deal with DISH would meaningfully address the loss of competition otherwise caused by this mega merger. Among those concerns:

  • DISH has never shown any inclination or ability to build a nationwide mobile network on its own and has repeatedly broken assurances to the Federal Communications Commission about deployment of its spectrum;
  • DISH does not have the network to operate as an independent competitor, like Sprint does today, and will instead remain reliant on the T-Mobile network for the foreseeable future; and
  • T-Mobile and Sprint are asking Americans to trust that this new mega corporation will act directly against its own economic interests by helping transform DISH into an independent competitor that rivals this new company.

The states remain committed to protecting competition in the marketplace and lower prices for consumers.

In addition to Michigan, the plaintiffs currently include New York, California, Colorado, Connecticut, the District of Columbia, Hawaii, Maryland, Massachusetts, Minnesota, Mississippi, Nevada, Virginia, and Wisconsin.