Fight Not Over After T-Mobile CDMA Shutdown Delay

A three-month delay in T-Mobile's CDMA shutdown isn’t long enough, and T-Mobile should delay until 2023, a Dish Network official said Monday. Experts said the delay until March 31 likely won’t be enough to mollify other critics or California regulators. Dish bought Boost from T-Mobile to partially resolve regulator concerns about T-Mobile buying Sprint and has raised concerns many of the prepaid service’s customers use 3G phones.

T-Mobile decided to postpone “following discussions with the U.S. Department of Justice and to err on the side of protecting consumers and remove any doubt that there is sufficient time for DISH to complete the CDMA migration,” the carrier told the California Public Utilities Commission in docket A.18-07-011 Friday. That's when the carrier announced the pause; see our news bulletin here. The CPUC didn’t comment Monday.

“T-Mobile’s announcement is a recognition that its premature shutdown of the CDMA network will harm consumers who rely on this network for critical connectivity, including 911,” emailed Jeff Blum, Dish executive vice president-external and legislative affairs. “While additional time is welcome, three months is not nearly sufficient to protect the well over one million Boost consumers -- many of whom are low income -- projected to still need access to this network beyond March 31."

Dish has migrated millions of consumers off the historic network, but “migrations of this scale are complex and take time,” Bloom said: “Despite DISH’s significant migration efforts to date, supply chain cellphone shortages, COVID-related interruptions and other economic challenges continue to constrain upgrades.” Dish cited testimony from Neville Ray, T-Mobile president-technology, who said in 2019 that T-Mobile expected a three-year migration process after the Sprint buy was consummated. “T-Mobile tries to blame third parties for its unilateral decision to prematurely execute a CDMA shutdown,” Blum said now: “It is T-Mobile who should take responsibility and honor its commitments, made under oath, to preserve the CDMA network until 2023.” T-Mobile didn't comment.

The new concession likely won’t resolve concerns, predicted Summit Ridge Group President Armand Musey. “Wireless customers still on CDMA are typically older people, others resistant to change and some IoT users,” he said: “If they are forced to buy new phones, they will likely be unhappy and churn to other providers in high numbers.”

The fight isn’t over “by any means,” said Public Knowledge Senior Vice President Harold Feld: “This does kick the can down the road until next year.” If the COVID-19 pandemic subsides, “it's easier to get folks in stores for replacement handsets and hand-holding,” he said: “If COVID flares up again, or the equipment shortage continues to be a problem, then three months may not be enough. This is why we keep saying the FCC has to exercise oversight of this process.”

Conflict will continue, at least in California, New Street’s Blair Levin told investors. “Based on the transcript of the hearing," CPUC administrative law judges seem "more sympathetic to DISH’s arguments,” he wrote: “If so, California may act to delay the shut-down beyond the three months, though that would only affect the T-Mobile network in California.” Then, “the question becomes how the DOJ and the FCC will react to California’s decision and the prospect of some number of low-income customers outside of California losing service,” he said. The previous conventional wisdom (see 2105060024) was the FCC and DOJ didn’t want to “take a strong stand,” Levin said.

'Truthful and Candid'

T-Mobile was “truthful and candid throughout” the CPUC merger review, the carrier said in a post-hearing brief filed Friday. At the Sept. 20 hearing, Dish "added nothing of substance germane to the” CPUC’s order to show why it didn’t violate a commission rule, "but T-Mobile’s truncated cross-examination” of Dish's Blum exposed “fundamental inconsistencies” in the satellite company's claim that T-Mobile committed to maintain CDMA for three years, T-Mobile said.

Dish “feigned indignation” when it sought additional sanctions against T-Mobile for sharing a document Dish said was confidential (see 2110140029), T-Mobile said: Dish never objected to sharing the business plan with the commission at the hearing, “and it gratuitously attacks the integrity of both T-Mobile and its counsel.”

The Alarm Industry Communications Committee said it hopes AT&T will also postpone a Feb. 22 sunset (see 2108200021). “AT&T has acknowledged the obstacles the alarm industry faces as they recently divested themselves of their 3G alarm customers rather than undergo the time consuming and costly life-saving responsibility of replacing 3G radios for their alarm customers,” a spokesperson emailed: “We hope and expect that AT&T will delay their sunset for other providers of alarm services who are dependent on their 3G network.” AT&T didn’t comment.

“What’s most important here is that the FCC intercede to ensure that the one million or more low-income Boost subscribers who could be left without cellphone service during a pandemic are protected,” said Michael Calabrese, director of the Wireless Future Program at New America. “The FCC clearly has the authority to call the parties in, serve as referee, and require whatever steps are necessary to protect prepaid subscribers who in most cases are not even aware yet that their service could be terminated,” he said.

T-Mobile is “trying to change the narrative of the story to be seen as the reasonable side in its conflict with Dish,” said Recon Analytics Roger Entner. T-Mobile offered free 5G phones to Boost customers who switched, “asking why Dish can’t or won’t do it,” he said: “Essentially, T-Mobile through its conduct wants to pose the question of how many more opportunities Dish needs to do the right thing for its customers. All of this is with the backdrop that the other two nationwide carriers are also shutting down their 3G networks."