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Fourteen attorneys general will challenge T-Mobile and Sprint merger in court this week

Posted by | M&A, Mobile, sprint, T-Mobile | No Comments

After months of statements, the biggest challenge yet to T-Mobile and Sprint’s proposed merger kicks off today in a Manhattan court. The trial is the result of pushback from a coalition of attorneys general of 13 states and the District of Columbia, who have raised flags over the proposed $26 billion merging of the country’s third and fourth-largest carriers.

“Today we stand on the side of meaningful competition and affordable options for consumers,” California Attorney General Xavier Becerra said in a statement provided to TechCrunch. “Our airwaves belong to the public, who are entitled to more, not less. This merger would hurt the most vulnerable people among us — leaving consumers with fewer choices and higher prices. We’re fighting in court with a 14-state strong coalition for then, and for all Americans, and we’re confident the law is on our side.”

The AGs contend that such a merger will decrease competition in the U.S. telecom market, by knocking the number of major carriers down to three. T-Mobile and Sprint, on the other hand, have argued that it will do the opposite, suggesting that the companies’ pooled powers would better equip them to take on Verizon and AT&T in the rush to 5G.

Over the summer, FCC Chairman Ajit Pai issued an order essentially arguing with the carriers and suggested the deal move forward. “The evidence conclusively demonstrates that this transaction will bring fast 5G wireless service to many more Americans and help close the digital divide in rural areas,” he said in August.

The trial is expected to last three weeks, per The Wall Street Journal, kicking off with today’s opening statements. Sprint Chairman Marcelo Claure and soon-to-be-former T-Mobile CEO John Legere will take the stand to make their case against the AGs.

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T-Mobile opens pre-orders on two 5G phones as low-band network goes live

Posted by | 5g, hardware, Mobile, OnePlus, Samsung, sprint, T-Mobile | No Comments

The 5G question has long been carts and horses. The next-generation wireless network has always been an inevitability, of course, but the rollout has always felt a bit piecemeal. T-Mobile, to its credit, is looking to flip the switch all at once (kind of), launching a “nationwide” deployment of 5G to a coverage area it says will reach 200 million of the U.S.’s 327 million residents.

The 600MHz low-band network goes live today, fulfilling the promise of 5G in 2019 with nearly a month to spare. That coincides with the pre-order of two 5G-enabled handsets, from OnePlus and Samsung. The OnePlus 7T Pro 5G McLaren Edition, at least, is a T-Mobile exclusive here in the States.

It’s a premium as far as OnePlus goes, but still arrives at the (relatively) low price of $900. Compare that to the $1,300 Galaxy Note 10 Plus 5G. Both are officially going on sale on Friday, and should be able to connect to the new network at launch.

T-Mobile’s clearly being more deliberate in its roll out here, fighting the urge to plant its flag. Instead, the carrier’s network will be available in wider swaths of land versus the competition’s neighborhood to neighborhood approach. And while the network isn’t expected to be as fast as other solutions, it should reach indoors better — a pretty key differentiator.

As CNET notes, it’s still fairly piecemeal in certain respects — the existing millimeter 5G wave network won’t work with the new devices. Nor will older devices work with the new network. Much of this move appears to be in anticipation of T-Mobile’s merger with Sprint.

The ability to compete with AT&T and Verizon on the 5G front has always been the key selling point of such a merger. Though reducing the field from four players down to three to increase competition has always seemed a dubious claim, at best.

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John Legere is stepping down as CEO of T-Mobile, succeeded by deputy Mike Sievert on May 1

Posted by | adam neumann, AT&T, deutsche telekom, john legere, M&A, Mobile, Personnel, Softbank, SoftBank Group, sprint, T-Mobile, TC, telecommunications, united nations, United States, Verizon, WeWork | No Comments

He’s reportedly not going to take over WeWork, but John Legere is definitely on his way out of the CEO role at T-Mobile, the carrier that is currently merging with SoftBank-controlled Sprint. Today the carrier and Legere confirmed that Mike Sievert — currently T-Mobile’s COO — will succeed Legere as CEO on May 1 of 2020. Legere will stay on the board.

Neither Legere nor T-Mobile commented on what his next move will be, and specifically if this will pave the way for him to take over the top job at WeWork. There had been reports that Legere — something of a turnaround specialist — was being lined up for the job at the very troubled office-space startup, which had to shelve its IPO earlier this year after showing poor financials amid questionable management that not only led to the departure of its founder Adam Neumann as CEO, but a strong devaluation of the company that resulted in SoftBank, as a major creditor, taking control.

The reports of Legere coming in to fix things at WeWork seemed to get refuted quite swiftly. However, the same “sources” that quashed that story also insisted he had “no plans” to leave T-Mobile. With elements of the report in doubt, that could put the WeWork rumors (or thoughts of other SoftBank roles, for that matter) back on the table. We’ve asked Legere directly and will update this post if he replies.

Legere has been with T-Mobile since 2012, where he used his irreverent personality to directly spar with the industry while at the same time position the carrier — which has long trailed bigger competitors like AT&T and Verizon (which owns us) in size — as a growth story and different from the pack (hence the “un-carrier” marketing strategy). The stock price has over that time gone up, and the carrier is currently valued at around $65 billion. (Notably, the stock is down about 1.5% today on the back of this news.)

Sievert will be tasked with continuing the route that Legere set, T-Mobile said, “demonstrating that T-Mobile will remain a disruptive force in US wireless marketplace to benefit consumers.”

“I hired Mike in 2012 and I have great confidence in him. I have mentored him as he took on increasingly broad responsibilities, and he is absolutely the right choice as T-Mobile’s next CEO,” said Legere in a statement. “Mike is well prepared to lead T-Mobile into the future. He has a deep understanding of where T-Mobile has been and where it needs to go to remain the most innovative company in the industry. I am extremely proud of the culture and enthusiasm we have built around challenging the status quo and our ongoing commitment to putting customers first.”

“The Un-carrier culture, which all our employees live every day, will not change,” Sievert said in a separate statement. “T-Mobile is not just about one individual. Our company is built around an extraordinarily capable management team and thousands of talented, committed, and customer-obsessed employees. Going forward, my mission is to build on T-Mobile’s industry-leading reputation for empowering employees to deliver an outstanding customer experience and to position T-Mobile not only as the leading mobile carrier, but as one of the most admired companies in America.”

Regardless of whether this is a sign that SoftBank indeed has a job lined up for Legere at one of its other portfolio companies, such as WeWork, the changing of the guard makes some sense, as the merger with Sprint would leave a question mark over who would lead the combined business. The two companies were reportedly close to releasing a management line-up for the merged business earlier this year, but that has yet to happen. The merger is due to be completed early next year.

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T-Mobile sugar-coats Sprint merger with promises of free data — but only if it’s approved

Posted by | Government, M&A, Mobile, sprint, T-Mobile, TC | No Comments

The planned $26 billion merger between T-Mobile and Sprint has been approved by the Justice Department and the FCC, but it’s not a sure thing yet. To sweeten the deal, T-Mobile is dangling three big free and cheap data initiatives that will only go through if the merger does. A little sugar helps the medicine go down.

Contingent on creating the “New T-Mobile,” there are three big moves planned, all of which, to be fair, sound great:

  • 10 years of free 5G for all police, fire, emergency medical services and other first responders countrywide
  • Free wireless service and reduced cost devices to 10 million disconnected households in the U.S. and Puerto Rico
  • New $15/month prepaid plan with unlimited talk and text and 2GB of data

Obviously these are all aimed at making it seem like T-Mobile is concerned with the public good. And no one is disputing that these programs would help a lot of people out. It just feels like such a transparent play to balance out the anti-competitive risks of the merger.

FCC Commissioner Brendan Stark speculated in his dissent from yesterday’s approval decision that the merger would lead to three 900-pound gorillas that would “divide up the market, increase prices, and compete only for the most lucrative customers.”

FCC Chairman Ajit Pai, on the other hand, asserts that the merger “will provide New T-Mobile with the scale and spectrum resources necessary to deploy a robust 5G network across the United States,” and make it competitive with Verizon and AT&T. (Disclosure: TechCrunch is owned by Verizon Media, but this does not affect our coverage.)

Although the regulatory hurdles are out of the way, the merger still faces a lawsuit from a collection of states that oppose the deal. That’s due to go to court soon, but may be either dismissed or delayed due to the fact that the complaints were filed before the Justice and FCC approvals, and the stipulations with which that came.

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FCC approves T-Mobile/Sprint merger despite serious concerns

Posted by | FCC, Government, M&A, Mobile, sprint, T-Mobile | No Comments

The FCC has given its stamp of approval to T-Mobile and Sprint’s proposed merger, saying the deal will “enhance competition” and hasten 5G deployment. Those opposed say the merger defies common sense, creating a triumvirate of mobile giants that will “divide up the market, increase prices, and compete only for the most lucrative customers.”

The two mobile companies have been attempting to merge for years, ostensibly in order to compete with the considerably larger AT&T and Verizon. (Disclosure: TechCrunch is owned by Verizon Media, but this does not affect our coverage in the slightest.)

Previous attempts at deals were blocked more or less on the grounds that while a consolidated market might make the new T-Mobile/Sprint entity more competitive, it would be a net negative for consumers, who would have less choice than ever. The announcement of a $60 million FTC settlement over anti-consumer business practices by AT&T when they had the leverage to carry them out is a timely reminder of the general temperament of mobile carriers.

This latest attempt by the two companies (and backers like SoftBank, which stands to make a bundle on the deal) has met with more success, and the Department of Justice approved it in July. The DoJ’s proposed remedies for competition problems created by the merger apparently gave the FCC “further confidence” in its approval, which Chairman Ajit Pai signaled earlier this year — interestingly, before those remedies were proposed.

Among other things, Sprint must sell its Boost Mobile brand, and T-Mobile must sell its interest in Dish Network. The hope is that Dish, Boost and a few other players will somehow band together to form a new insurgent wireless network that will rise to compete with its former masters.

Sound a bit far-fetched? FCC Commissioner Rosenworcel thinks so as well.

Commissioner Rosenworcel at her confirmation hearing

“Instead of promoting vigorous competition among providers, today’s order justifies increased concentration by jerry-rigging a new provider dependent on the government dictating who sells what to whom and when,” she said in a statement.”

Commissioner Starks indicated his dissent on other grounds as well, specifically recent charges that Sprint has been irresponsibly deploying funds from the Commission’s Lifeline program for low-income mobile subscribers.

“Sprint may be responsible for the most egregious violations of our Lifeline rules in FCC history,” Starks wrote in a statement. “Our review should have been held in abeyance following the Chairman’s recent announcement of an investigation into Sprint’s alleged misappropriation of Lifeline support for 885,000 ineligible accounts. If substantiated, this would represent the misuse of nearly 10 percent of the funds for the entire program.”

More than anything else, though, critics remain skeptical of the basic idea that consolidation will produce increased competition. In fact, the Justice Department even thinks that may happen, which is why it is requiring the carriers to hastily assemble a new competitor out of whatever parts are left laying around, including some still being used by T-Mobile and others.

“The proposed transaction is exactly the type of merger that the Justice Department and the Commission have discouraged and rejected in the past: one that would harm competition and result in higher prices and poorer service, particularly for the most vulnerable consumers,” wrote Starks.

Others are concerned that the deal seemed to be a done deal even before Justice handed down its recommendations to improve competition following the merger.

“The FCC majority prejudged the merits of this merger two months before the Justice Department found the combination of T-Mobile and Sprint to be anticompetitive and required the creation of a new fourth competitor to pass legal muster. Despite this radical change in the merger, Chairman Pai has refused to put the new arrangement out for public comment,” noted Gigi Sohn, who was counselor to former FCC Chairman Tom Wheeler.

“Three of my colleagues agreed to this transaction months ago without having any legal, engineering, or economic analysis from the agency before us,” wrote Rosenworcel. “The procedural irregularities that have plagued the FCC’s review of this transaction make it difficult to ensure this agency’s findings are credible—especially when in so many key respects they are at odds with the findings of the Department of Justice.”

Proponents of the deal lean heavily on promises being made that “New T-Mobile,” as it is referred to in the decision, will use its new position to quickly and efficiently deploy 5G to many markets it might not otherwise have reached.

“This transaction will provide New T-Mobile with the scale and spectrum resources necessary to deploy a robust 5G network across the United States,” said Chairman Pai in his statement regarding the decision. “New T-Mobile will make the mobile broadband market more competitive in large swaths of rural America where neither Sprint nor T-Mobile is currently a strong competitor to AT&T and Verizon.”

Pai says the idea that reducing the number of major carriers from four to three will be harmful to competition is a “simplistic, backward-looking claim.” The truth, he says, is that in many places this merger will increase the number of competitors from two (Verizon and AT&T) to three as T-Mobile enters the market. That’s fair speculation to be sure, but as Commissioner Starks points out, that idea too is simplistic. The truth is that reducing the number of major carriers will likely have serious and immediate negative effects as well as well as Pai’s imagined long-term benefits.

“In the short term, this merger will result in the loss of potentially thousands of jobs. In the long term, it will establish a market of three giant wireless carriers with every incentive to divide up the market, increase prices, and compete only for the most lucrative customers,” Starks writes.

While Justice and FCC approval were the largest obstacles to the proposed merger, much still has to occur before Sprint customers find their phones switching over to the T-Mobile network. More than a dozen states have opposed the merger and filed lawsuits, though those might be mooted under the new proposed scheme. Still, state-level challenges are no joke and may further delay the merger, especially if they are elevated to the federal level.

This story is developing; check back for updates.

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OnePlus’ second 5G phone will be a T-Mobile exclusive

Posted by | 5g, hardware, mclaren, Mobile, OnePlus, sprint, T-Mobile | No Comments

OnePlus’ 5G strategy has marked something of a shift for a company that has traditionally prided itself in a slow and steady approach to new features. Following the arrival of the OnePlus 7 Pro 5G this summer, the company is announcing its second 5G device for the U.S. market.

This time, it has opted for its longer-time carrier partner, T-Mobile. Though soon enough, the distinction between the U.S.’s third and fourth place wireless carriers may be moot. For now, however, the OnePlus 7T Pro McLaren Edition is a T-Mobile exclusive here in the States.

For the record, the 7T Pro and the new McLaren Edition are pretty similar, though the latter gets a flashier color scheme and some pretty beefy specs, including an extremely generous 12GB of RAM.

Along with being OnePlus’ second 5G handset, it’s also the second T-Mobile device to support the next-gen network, following the already announced (but not yet released) Galaxy Note 10 Plus 5G. As for the state of T-Mobile’s 5G roll out, the company promises to “cover 200 million people nationwide this year.”

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HTC’s new CEO discusses the phonemaker’s future

Posted by | 5g, Apple, AT&T, augmented reality, Chanel, cher wang, China, deutsche telekom, Disrupt, Disrupt SF 2019, Ericsson, Exodus, Facebook, Google, hardware, HTC, huawei, Internet of Things, Louis-Vuitton, Mobile, mobile devices, Nokia, smartphones, sprint, T-Mobile, telecommunications, Verizon, Virtual reality, Yves Maitre | No Comments

On September 17, HTC announced that cofounder Cher Wang would be stepping down as CEO. In her place, Yves Maitre stepped into the role of Chief Executive, after more than a decade at French telecom giant, Orange.

It’s a tough job at an even tougher time. The move comes on the tail of five consecutive quarterly losses and major layoffs, including a quarter of the company’s staff, which were let go in July of last year.

It’s a far fall for a company that comprised roughly 11 percent of global smartphone sales, some eight years ago. These days, HTC is routinely relegated to the “other” column when these figures are published.

All of this is not to say that the company doesn’t have some interesting irons in the fire. With Vive, HTC has demonstrated its ability to offer a cutting edge VR platform, while Exodus has tapped into an interest in exploring the use of blockchain technologies for mobile devices.

Of course, neither of these examples show any sign of displacing HTC’s once-booming mobile device sales. And this January’s $1.1 billion sale of a significant portion of its hardware division to Google has left many wondering whether it has much gas left in the mobile tank.

With Wang initially scheduled to appear on stage at Disrupt this week, the company ultimately opted to have Maitre sit in on the panel instead. In preparation for the conversation, we sat down with the executive to discuss his new role and future of the struggling Taiwanese hardware company.

5G, XR and the future of the HTC brand

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Ajit Pai formally recommends T-Mobile/Sprint merger approval

Posted by | ajit pai, FCC, M&A, Mobile, Policy, sprint, T-Mobile | No Comments

Ajit Pai has long signaled that he would approve a T-Mobile/Sprint merger, but today the FCC chairman made it official. In spite of widespread opposition suggesting that the combining of the country’s third and fourth largest carriers would reduce competition in the marketplace, Pai takes the stance that such a move would actual promote competition.

“After one of the most exhaustive merger reviews in Commission history, the evidence conclusively demonstrates that this transaction will bring fast 5G wireless service to many more Americans and help close the digital divide in rural areas,” Pai said in a statement. “Moreover, with the conditions included in this draft Order, the merger will promote robust competition in mobile broadband, put critical mid-band spectrum to use, and bring new competition to the fixed broadband market. I thank our transaction team for the thorough and careful analysis reflected in this draft Order and hope that my colleagues will vote to approve it.”

Today, I circulated an order that would approve, subject to conditions, the proposed merger of T-Mobile and Sprint . The deal would advance fast #5G across the country, help close #digitaldivide, and put critical mid-band spectrum to use. My full statement: https://t.co/fBKvLnPgmm pic.twitter.com/21r3Us9cUG

— Ajit Pai (@AjitPaiFCC) August 14, 2019

Pai’s statement echoes that of many conservatives on the topic. While T-Mobile and Sprint are in third and fourth place, respectively, AT&T and Verizon are significantly ahead in terms of subscriber bases. Pai and other have suggested that combining the two under the T-Mobile umbrella would help the carriers get a leg up when it comes to competing on a 5G roll out.

Consumers will directly benefit from improvements in network quality and coverage, which in turn will foster innovation in a wide variety of sectors and services (itself creating significant public interest benefits),” Pai’s team writes.Moreover, the transaction will help to close the digital divide by bringing robust 5G deep into rural areas, with enforceable conditions in the draft Order requiring coverage of at least 99% of Americans within six years.”

Last month, the proposed merger was given the go-ahead by the U.S. Department of Justice on the condition that Sprint sell its prepaid assets (including Boost) to Dish network. A growing number of state attorneys general, meanwhile, have opposed the merger. Oregon joined the lawsuit yesterday, bringing the total up to 15 states and the District of Columbia.

“If left unchallenged, the current plan will result in reduced access to affordable wireless service in Oregon — and higher prices,” Oregon AG Ellen Rosenblum said. “Neither is acceptable.”

Pai noted earlier this year that he planned to approve the $26.5 billion deal, which would knock the country’s premium carriers down to three. No word yet on when the Commission will formally vote on the deal.

FCC Commissioner Jessica Rosenworcel had a different take on things, noting, “The FCC’s draft order approving the largest wireless merger in history just landed in my inbox. I believe we need more competition, not less. I am not convinced that removing a competitor will lead to better outcomes for consumers. But what I am convinced of is that before the FCC votes on this new deal negotiated by Washington, the public should have the opportunity to weigh in and comment. Too much here has been done behind closed doors.”

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Oregon joins lawsuit opposing T-Mobile/Sprint merger

Posted by | Mobile, sprint, T-Mobile | No Comments

Oregon this week became the 15th state (plus the District of Columbia) to sign onto a lawsuit seeking to stop a T-Mobile/Sprint merger. The suit, co-signed by 16 attorneys general, argues that a merger between the country’s third and fourth largest carriers would greatly reduce competition in the wireless industry.

“It’s important that Oregon join other states in opposing the Sprint -T-Mobile merger,” said Oregon AG Ellen Rosenblum said in a statement. “If left unchallenged, the current plan will result in reduced access to affordable wireless service in Oregon — and higher prices. Neither is acceptable.”

Texas joined the suit earlier this month, marking one of only two Republican AGs who have signed onto the deal. Conservative voices have largely come out in favor of a merger, suggesting that by joining forces the new company (also named T-Mobile) would increase competition for AT&T and Verizon by getting a leg up in the race to implement 5G.

New York State AG Letitia James says the signee has added “momentum” to push against the merger, which was greenlit by the U.S. Department of Justice in late July.

“Oregon’s addition to our lawsuit keeps our momentum going, and ensures that there isn’t a single region of this country that doesn’t oppose this anticompetitive megamerger,” said James. “We welcome Attorney General Rosenblum to our 16-member coalition that now includes states representing almost half of the U.S. population. We remain committed to blocking the merger of T-Mobile and Sprint because it would bad for consumers, bad for workers, and bad for innovation.”

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OnePlus’ first 5G handset is headed for Sprint

Posted by | 5g, Mobile, OnePlus, smartphones, sprint | No Comments

Sprint this morning announced that it will be the first network to get its hands on OnePlus’s long-promised 5G handset [not pictured]. The Shenzhen-based manufacturer announced late last year that it was targeting 2019 for the device, bucking the trend of being slightly behind the curve on the latest smartphone technologies.

Sprint’s not offering much in the way of actual information here — no pricing or availability. Not even specs or a device name were made available via the press release. Rather, the carrier notes that this is its first 5G smartphone, joining three other non-phone 5G devices for the nascent network.

Last year, OnePlus made a device available for the first time through a U.S. carrier, partnering with T-Mobile for the 6T. It’s made the jump to Sprint this time out, though given merger plans, that distinction may soon be moot regardless. Sprint’s 5G network is currently available in AtlantaChicagoDallas-Fort Worth, Houston and Kansas City, with Los Angeles, New York, Phoenix and Washington, D.C. arriving in “the coming weeks.”

“We are proud to join with Sprint to bring an ultra-premium smartphone to their network,” OnePlus CMO Kyle Kiang said in a release. “As a community-driven company, we are thrilled to tell OnePlus enthusiasts on the Sprint network that the wait is finally over. This is a tremendous opportunity to expose Sprint customers to the award-winning OnePlus brand.”

The partnership isn’t being listed as an exclusive, but OnePlus has generally taken a measured approach to expansion, so it seems likely the company will only offer a single carrier partner this time out.

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