As Senate Judiciary Eyes Hearing on Sprint/T-Mobile, Merits Debated

Attention to T-Mobile buying Sprint continued at the FCC, on Capitol Hill and elsewhere in Washington Thursday and Friday. The Senate Judiciary Antitrust Subcommittee plans a June hearing on the deal, said industry officials, who had expected it (see 1804300057). And current and past FCC members' and staffers' views on the deal vary by party, with Democrats wary and Republicans less so.

At Thursday's FCC meeting, Commissioner Mike O'Rielly said he doesn't have "an artificial limitation" on the optimal number of national mobile wireless operators. He and Commissioner Brendan Carr didn't comment on Sprint/T-Mobile. "Going from four to three is a hard case" for proving Sprint/T-Mobile wouldn't result in higher prices and decreased innovation, Commissioner Jessica Rosenworcel said. Senate Judiciary Antitrust ranking member Amy Klobuchar, D-Minn., urged the FCC and DOJ to “closely review” T-Mobile/Sprint (see 1805070054). Senate Judiciary didn't comment Friday.

The deal would either stimulate 5G investment or hurt consumers, said former Commissioner Robert McDowell and Georgetown Law Institute for Technology Law & Policy distinguished fellow Gigi Sohn, in an episode to have aired on C-SPAN’s The Communicators Saturday. The $40 billion the combined company would spend on 5G deployment over three years is more than the companies would spend individually, said McDowell, now with Cooley and representing T-Mobile in the deal, saying such a combination wouldn't mean lost competition since other players like cable operators are entering wireless and Sprint/T-Mobile would be "a supercharged maverick." He said with so many operators spending billions on 5G networks in coming years, "there absolutely will be price competition."

Sohn told C-SPAN prices are likely to rise and competition to suffer since Sprint and T-Mobile "have been feisty competitors" to AT&T and Verizon. She said Sprint's ownership of Virgin Mobile and Boost Mobile, and T-Mobile's of Metro PCS -- three of the largest prepaid low-cost carriers -- means low-income consumers would have fewer choices. She said cable is hardly a competitor now for national wireless carriers, with Comcast's 577,000 wireless subscribers "a drop in the bucket" compared with the 98 million at Sprint/T-Mobile. She said Sprint and T-Mobile are working on 5G networks independently, so that's not a specific benefit. Sohn said it’s likely the public interest community will oppose the deal because of wireless consolidation concerns.

Asked about AT&T's proposed buy of Time Warner, Sohn said even if the telco prevails at the U.S. Court of Appeals for the D.C. Circuit, conditions could put a damper on other such vertical transactions. "Surprises do happen," McDowell said, but it's difficult to see DOJ prevailing since there isn't an economic incentive for withholding content. He said a Congressional Review Act revival of Communications Act Title II regulation of ISPs might squeak through in the Senate, but there's less chance of passage in the House and even less chance President Donald Trump will sign it into law.