T-Mobile/Sprint merger review might go longer and harder in California, as DISH’s act is questioned

by Steve Blum • , , , ,

The California Public Utilities Commission should get the dish on DISH, before deciding whether T-Mobile’s proposed takeover of Sprint “would serve the public interest”, according to a protest filed yesterday by a coalition of opponents to the deal. The group includes the CPUC’s public advocates office, two consumer advocacy groups and the Communications Workers of America, the primary telecoms union in California. To do that, they propose a schedule of testimony and arguments that would bump any decision on the merger until sometime next spring.

T-Mobile refiled its application for CPUC approval last month, after its deal with Sprint was extended to include spinning off assets to DISH in order to maintain sufficient competition in the mobile services marketplace. Or so the federal justice department believes. DISH owns a considerable amount of mobile spectrum, but hasn’t put it to use yet – it’s primarily a satellite TV outfit, not a telecommunications network operator or service provider.

Under the new agreement, DISH gets spectrum, cell sites and retail outlets from T-Mobile and Sprint, so it can eventually build its own network. In the meantime, it would lease capacity from T-Mobile, and resell it under its own brand name – become what’s known as a mobile virtual network operator (MVNO). In their protest, the opponents questioned whether DISH is capable of fulfilling those promises…

This Proposed Transaction dissolves the fourth main wireless carrier and proposes the creation of a possibly inferior substitute to become a new fourth carrier. This could have profound impacts on competition, jobs, and quality of service, among other things. Especially, the Commission should examine whether approving the [deal with DISH] and creating a new wireless carrier is more beneficial to California than simply keeping Sprint as a strong and viable fourth carrier.

  • Is DISH, as [an MVNO] operating on New T-Mobile’s network for the first several years of the settlement, an adequate replacement for Sprint to serve customers in the prepaid market?
  • Can a client MVNO, new to the mobile wireless market, realistically be expected to provide the same level of competitive check that Sprint, a competitive Mobile Network Operator (MNO), currently exerts on T- Mobile?

There are more questions in the full document, but one they didn’t ask and should have was is DISH any more serious about this promise than it was about past pledges to build a mobile network?

T-Mobile, along with everyone else, is scheduled to meet later today with the CPUC administrative law judge managing the case. They’ll talk about next steps.

Links to the stack of arguments and exhibits everyone has filed are here.

My clients include California cities who do business with T-Mobile. I like to think that has no bearing on my commentary, but I like to think I’m good looking too. Take it for what it’s worth.