T-Mobile-Sprint Merger Postponed Over Dish Ownership
T-Mobile and Sprint have once again pushed back the deadline for their $26 billion merger—a deal that’s been in the works for over a year now. This time, the carriers were held up by disagreements between ownership restrictions and conditions for Dish Network, the Wall Street Journal reports.
Dish is resisting certain limits that T-Mobile’s parent company, Deutsche Telekom wants to impose on them. To the immense frustration of negotiators, T-Mobile wants to control who can own and later buy a part of the new Dish wireless network. Essentially, T-Mobile and Deutsche Telekom want to prevent Dish from going to another cable or technology company. The parties have also been mulling over restrictions on how much traffic Dish can send over the new T-Mobile network.
In terms of what actually has been established, Dish and the cellphone carriers are on common ground about a broad deal that would transfer spectrum licenses, prepaid phone customers and other assets to Dish. T-Mobile and Sprint also agreed to sell the prepaid brand Boost to gain merger approval, but the final decision is dependent upon the U.S. Department of Justice.
The Justice Department is also concerned about the level of competition that will exist from the third and fourth most popular cellphone carriers merging. They’ve indicated that they want to see a strong competitor in the ring with Verizon, AT&T, and T-Mobile if the merger comes to fruition. In the event that it does, each of those three companies would have roughly 100 million subscribers or more.
Even if the Justice Department decides to approve the deal, the merger will have to go up against several state attorneys general, some of whom sued last month to block the merger. So really, T-Mobile and Sprint still have quite a long road ahead, which is probably why a new deadline is still TBD. But T-Mobile has plans to contest the lawsuit in a trial set for Oct. 7.