California Public Utilities Commission approves T-Mobile-Sprint merger, applies ‘extensive’ conditions

17 Apr 2020

The California Public Utilities Commission (CPUC) has belatedly approved the merger of Sprint and T-Mobile US, after applying an ‘extensive’ list of conditions. Although the transaction closed on 1 April – T-Mobile did not want to risk losing its in-place financing – the CPUC warned the mobile giants to refrain from merging their Californian operations until a decision had been made, as per Section 854 of the Public Utilities Code.

The CPUC has now voted to approve the merger, after applying a number of conditions to ‘mitigate the potential adverse impacts on competition and to ensure that T-Mobile delivers on its promises to consumers’, including requirements for faster speeds, broader coverage, job creation and offerings for low-income customers. Going forward, the merged company must:

· Provide 5G wireless service with speeds of at least 100Mbps to 99% of California’s population by the end of 2026, and 300Mbps to 93% by the end of 2024.

· Provide 5G wireless service with speeds of at least 100Mbps to 85% of California’s rural population, and speeds of at least 50Mbps available to 94% of California’s rural population, by the end of 2026.

· Make fixed home internet access available to at least 2.3 million California households, of which at least 123,000 are rural households, within six years.

· Maintain or improve current 4G LTE service quality and coverage for existing customers during the transition to 5G.

· Offer the low-income California Lifeline programme – a service not currently supported by T-Mobile – for as long as it operates in California and enrol at least 300,000 new Lifeline customers.

· Increase jobs in California by at least 1,000 compared to the total number of current Sprint and T-Mobile employees.

TeleGeography notes that the US Federal Communications Commission (FCC) and Department of Justice (DoJ) approved the transaction last year with conditions, including the divestiture of Boost Mobile and a portion of 800MHz spectrum to DISH Network, to allow the latter to establish itself as a national mobile operator. A coalition of states, including California and New York, filed a lawsuit to block the deal, but US District Judge Victor Marrero ultimately ruled in favour of the deal in February.

United States, Sprint Corporation, T-Mobile US