Report: Justice Department to Block T-Mobile-Sprint Merger
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Days after the FCC signaled its intent to support the merger between T-Mobile and Sprint, the Department of Justice has reportedly decided to block the deal.
According to CNBC and Reuters, the DOJ's antitrust division has recommended that the agency file a lawsuit to block the deal between the two wireless carriers. The agency will reportedly make its final decision in the next month.
The FCC's seal of approval came after the carriers agreed to sell off Sprint subsidiary Boost Mobile to spur competition at the low-cost end of the market. T-Mobile and Sprint also agreed to numerous nationwide milestone goals around the 5G infrastructure rollout over the next half-dozen years.
However, the merger always needed to clear regulatory hurdles at both the FCC and DOJ. Antitrust officials in the department, long skeptical of the deal, have reportedly harbored significant concerns over whittling the four major U.S. carriers down to three.
T-Mobile and Sprint previously agreed not to raise prices for three years following the merger, but the FCC's revised terms did not include any additional price promises or rate agreements with other MVNOs. The antitrust argument against the merger is that in the long run, the decreased competition will raise prices while reducing the incentive for prolonged innovation.
Either way, the carriers will have to wait a little while longer to learn the ultimate fate of their merger, which has been under regulatory review for more than a year.