T-Mobile and Sprint have endorsed a major obstacle towards finalizing their merger. The U.S Department of Justice has approved the deal on the condition that the carriers sell some parts of the business to Dish Network. Both companies will sell their prepaid parts of Sprint’s business to Virgin Mobile, Boost Mobile, and Sprint prepaid to Dish. The Dish Network will get a chunk of Sprint’s spectrum. Sprint and T-Mobile will open at least 20 thousand cell sites and a large number of retail locations to Dish Network. T-Mobile will offer Dish robust access to its mobile network for 7-years while the latter creates a 5G network of its own.
It is noteworthy that if Sprint and T-Mobile don’t meet these conditions, the U.S Department of Justice and 5 state attorneys general offices, including Nebraska, Kansas, Ohio, Oklahoma, and South Dakota will proceed with a lawsuit to block the merger. Dish Network plans to establish itself as a 4th nationwide carrier following the agreement. The major objective is to build a 5G network and it will reach 70% of the U.S population by June 2023. The Justice Department said in a statement that Dish Network proposal will enable a viable facilities-based competitor to enter the market, while the merger will speed up the rollout of high-quality 5G networks for the benefit of American consumers.
Sprint and T-Mobile also announced their plans to merge in April 2018. They claimed that they’d be able to build out a broad and deep 5G network more quickly by joining forces, than if they had to keep going it alone. The Justice Department’s proposed settlement is open to public comment for 60 days. The FCC (Federal Communications Commission) has to approve the deal. It isn’t likely to pose a problem for Sprint and T-Mobile because of the Chairman Ajit Pai’s recommendation to green-light the merger.