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5 reasons why it’s been a rough week for backers of the T-Mobile-Sprint merger

It’s been a rough week for backers of the proposed T-Mobile-Sprint merger. Below are five reasons why:

  • House hearing shows weakness of T-Mobile-Sprint merger claims: During a Wednesday hearing before the US House Energy and Commerce Subcommittee on Communications and Technology, witnesses raising concerns about the proposed merger offered detailed and extensive documentation and analysis, while merger supporters relied on vague and unsubstantiated claims. CWA President Chris Shelton’s delivered testimony captured why the jobs, consumer, and rural pledges of T-Mobile CEO and President John Legere and Sprint Executive Chairman Marcelo Claure should be viewed with a skeptical eye: “Without binding and enforceable commitments – and I mean commitments that have no loopholes – such promises are just cheap sales talk and are easily broken.” Many lawmakers shared this skepticism (see Wall Street Journal: “T-Mobile’s Sprint Takeover Comes Under New Attack”; Reuters: “T-Mobile and Sprint Execs Face Skeptical House Panel;” Bloomberg: “Lawmakers Tell T-Mobile, Sprint Chiefs That Deal Raises Red Flags”).
     

  • 30,000 lost jobs in the spotlight - “Trusting Sprint and T-Mobile with American jobs is like trusting a vampire at a blood bank”: CWA’s detailed economic analysis shows that the proposed T-Mobile-Sprint merger would eliminate 30,000 jobs (find a state-by-state breakdown of projected retail job loss here). As President Shelton’s House testimony noted, “Trusting Sprint and T-Mobile with American jobs is like trusting a vampire at a blood bank. These are two of the worst companies in the United States when it comes to labor law and the treatment of workers. In recent years, T-Mobile has been charged with more labor law violations per worker than even Walmart.”
     

  • Consumers face higher prices while T-Mobile offers “hollow promises that are in no way binding”: As Makena Kelly of The Verge recapped, “Phillip Berenbroick of Public Knowledge testified at the hearing that consumers could see a price hike of as much as 15.5 percent immediately after the merger. “While the companies unsurprisingly arrive at lower figures, even T-Mobile’s own economic studies also show that this merger would lead to higher prices,” Berenbroick said. … Critics of the deal came with evidence and examples from past proposed mergers, and T-Mobile and Sprint arrived with hollow promises that are in no way binding unless a regulatory body puts them in print.”
     

  • Rural claims questioned and debunked: A Washington Post article on the House hearing, titled, “‘These maps are bogus’: U.S. lawmakers tear into telecom execs over spotty rural coverage,” noted how lawmakers and experts at the House hearing focused on rural issues and why the companies’ claims don’t add up. As Rural Wireless Association General Counsel Carri Bennet, who testified at the hearing, noted: “T-Mobile’s treatment of rural Americans is not in the public interest.”
     

  • iWireless case study offers further undercuts idea that merger would benefit rural America. On Monday, CWA released the report, Disrupting Rural Wireless, explaining why T-Mobile’s 2018 acquisition of Iowa Wireless (“iWireless”) undercuts the claim that the T-Mobile-Sprint merger would benefit rural America and the small businesses that serve as authorized dealers for T-Mobile and Sprint services. As President Shelton’s testimony noted of T-Mobile, “After it acquired Iowa Wireless in 2018, it closed all iWireless call centers and more than 90 percent of its retail locations. It closed every single store in rural Iowa.” As Carri Bennet, General Counsel for the Rural Wireless Association said on a press call to release the report, “The iWireless story offers a real-world reminder why the proposed T-Mobile-Sprint merger would be harmful to consumers, especially those in rural markets, and should be denied as anticompetitive.”