Public Knowledge Urges Strict Scrutiny of $4.4 Billion T-Mobile/U.S. Cellular Deal Eroding Wireless Competition

If regulators permit this transaction, they should impose conditions to promote competition.

Today, T-Mobile announced that the company will purchase almost all of U.S. Cellular’s wireless operations, including customers, stores, and 30% of its spectrum assets in a deal valued at $4.4 billion. Public Knowledge contends that the deal raises competition concerns and should be closely scrutinized by the agencies responsible for protecting competition in the wireless market. Reduced competition in the wireless market can increase prices for consumers, reduce service quality, and stifle innovation.

The following can be attributed to Harold Feld, Senior Vice President of Public Knowledge:

“In 2020, despite warnings from Public Knowledge and others, the Department of Justice and Federal Communications Commission allowed T-Mobile to acquire Sprint. This transformed a competitive market with four major wireless companies into a concentrated market of the “Big Three” and a handful of competitors with tiny market share. Since then, this market has become further concentrated as the Big Three bought up independent providers such as Tracfone and Mint. Meanwhile, potential competitors such as Dish Network and cable companies have struggled to build competing networks as the largest providers spend billions at spectrum auctions to capture the wireless licenses necessary to compete. 

“Today’s announcement is yet another erosion of what competition remains, and puts more spectrum in the hands of one of the Big Three. In addition to spectrum and customers, T-Mobile will also acquire tower slots that could otherwise have been leased by competitors. The DOJ and the FCC, whose reckless approval of the T-Mobile/Sprint deal created this concentrated market in the first place, must scrutinize this merger very carefully and consider how this acquisition of spectrum licenses and tower slots (as well as customers) potentially denies would-be competitors the necessary inputs to compete effectively. If the regulators do permit the transaction, they should impose conditions – such as mandatory data roaming and cell phone unlocking – that will promote competition in this increasingly concentrated market.”

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