T-Mobile, Sprint file for approval of $26 billion merger

T-Mobile, Sprint file for approval of $26 billion merger
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T-Mobile and Sprint on Tuesday laid out the case for a $26 billion merger, filing for approval at the Federal Communications Commission (FCC).

In the 678-page document, the two companies argue that the combination, which they’re calling “New T-Mobile,” will allow them to build a fifth-generation wireless network that would rival those of AT&T and Verizon.

The communications companies are framing the deal as essential for U.S. efforts to build out 5G capabilities.

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“We cannot relinquish our leadership here and the New T-Mobile will deliver on these capabilities within the first couple of years of bringing these two companies together,” T-Mobile CEO John Legere wrote in a blog post on Tuesday. “As a country we cannot afford to miss this opportunity and the New T-Mobile is fully prepared to do our part, and to do it fast!”

The pitch is tailored for an administration that sees 5G efforts as essential. A leaked document earlier this year showed that the National Security Council had considered nationalizing 5G networks as a way of ensuring its security.

And President TrumpDonald John TrumpLondon terror suspect’s children told authorities he complained about Trump: inquiry The Memo: Tide turns on Kavanaugh Trump to nominate retiring lawmaker as head of trade agency MORE took the rare step of blocking a hostile takeover of Qualcomm by Broadcom, a tech giant that at the time was based in Singapore, out of concerns that it would set back the U.S. company’s 5G efforts.

But the proposal has already faced pushback from Democrats and consumer groups who worry that the deal, which would reduce the number of national wireless providers from four to three, will reduce competition in an already highly concentrated market.

They say they're concerned that eliminating a competitor will drive up prices and reduce the incentive to innovate within the industry. T-Mobile and Sprint tried to address the unease surrounding the deal in their FCC filing, saying that consumers would benefit from a powerful new 5G network.

“This proposed merger is necessary to accomplish a goal critical to enhancing consumer welfare in this country: the rapid and widespread deployment of 5G networks in a market structure that spurs rivals to invest in a huge increase in capacity, and, correspondingly, to drop tremendously the price of data per gigabyte,” the document reads.

An FCC spokeswoman declined to comment on the filing.