Friends and foes of the T-Mobile/Sprint deal want changes to CPUC’s proposed approval

3 April 2020 by Steve Blum
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Tmobile san francisco 18may2019

T-Mobile’s decision to ignore the California Public Utilities Commission and close its acquisition of Sprint without permission will result in at least some, and probably a lot, of revisions to the draft decision approving the deal that’s now waiting for a commission vote. Comments filed on Wednesday by past and present opponents of the merger don’t address T-Mobile’s regulatory insouciance – that’ll come later – but do suggest extensive changes to what’s already on the table.

Four of the five organisations that weighed in on the draft decision argued for tougher conditions, or for rejecting the merger altogether. The fifth said the CPUC was being too tough on T-Mobile.

The CPUC public advocates office (PAO) urged commissioners to kill the deal, saying that the thousands of pages of documents and hours upon hours of hearings did not produce enough evidence to show that the T-Mobile/Sprint merger is “in the public interest”, as state law requires. If commissioners go ahead and approve it, the PAO recommends tightening up some of the conditions and, particularly, adding more teeth to enforcement provisions. TURN, aka the Utility Reform Network, made similar points.

The Communications Workers of America (CWA) and the Greenlining Institute focused on concerns specific to their constituencies. CWA, which is the primary telecommunications union in California, also argues that the evidence in the record shows that the merger doesn’t serve the public interest, with particular attention to the impact on people who work for T-Mobile, Sprint and the sizeable ecosystem of companies that’s grown around them. Although it lays out a case for rejecting the merger outright, it instead asks for additional labor-related guarantees. Greenlining similarly points to a lack of attention the draft decision pays to communities of color, and recommends adding requirements aimed at fixing that problem.

The California Emerging Technology Fund (CETF) advocated – mostly – on T-Mobile’s behalf. CETF originally opposed the deal, but decided to “enthusiastically and wholeheartedly support” it after bagging a $35 million pay off from T-Mobile. The one big point CETF made that won’t warm T-Mobile’s heart was a request for stricter CPUC enforcement of the deal it cut for the money, saying it’s “concerned that [T-Mobile and Sprint] may be tempted to not comply”.

Ya think?

As Greenlining pointed out in its comments, CETF’s contract with T-Mobile is “expressly contingent upon the CPUC’s approval of the Wireline Application”, which is the application that T-Mobile now wants to withdraw.

Comments on the proposed decision of administrative law judge Karl Bemesderfer, 1 April 2020:
Joint Applicants (T-Mobile and Sprint)
CPUC Public Advocates Office
Communications Workers of America
California Emerging Technology Fund

TURN and Greenlining protest of Sprint’s CPCN relinquishment, 1 April 2020
CPUC Public Advocates Office, notice of ex parte meeting with CPUC president Marybel Batjer’s staff, 1 April 2020
Communications Workers of America, notice of ex parte meeting with CPUC president Marybel Batjer’s staff, 1 April 2020

Links to arguments and exhibits filed at the CPUC and elsewhere are here.

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