T-Mobile CEO John Legere typically proposes deals to wireless consumers. Now he is offering one to the Federal Communications Commission.
If the FCC approves the telecom company’s $26 billion merger with competitor Sprint, T-Mobile will put price increases on hold for three years, Legere said in note sent this week to FCC Chairman Ajit Pai.
Some critics have opposed the deal, announced in April, saying the elimination of one of the four largest wireless providers – Sprint is the No. 4, behind Verizon, AT&T and T-Mobile – will lead to higher prices and harm consumers.
“To remove any remaining doubt or concerns about New T-Mobile’s prices while we are combining our networks over the next three years, T-Mobile today is submitting to the Commission a commitment that I stand behind – a commitment that New T-Mobile will make available the same or better rate plans for our services as those offered today by T-Mobile or Sprint,” Legere said in the letter dated Monday. “We believe this merger makes consumers better off, and we’re willing to put our money where our mouth is. Period.”
Those plans and rates will be made available to Sprint customers after the merger closes, which the companies hope to complete in the first half of this year, they say. However, these maintained rates may need to be adjusted should taxes, fees or third-party surcharges go up, “as these increased costs are not within the control of New T-Mobile,” the company said in a separate letter to the FCC.
Legere and Sprint executive chairman Marcelo Claure have said the combination of the two companies would create a stronger competitor to AT&T and Verizon in the looming 5G battles. The next generation of wireless technology, 5G promises to super-fast connections 100 times faster than current 4G networks along with better network responsiveness and each provider has begun their own tests.
Sprint would struggle to deploy a 5G network on its own, Claure told senators last June. But a combined Sprint and T-Mobile could force AT&T and Verizon “to react, invest and compete harder and that will be good for consumers and innovation,” he told them at the time.
T-Mobile has also pledged to build five new customer experience centers across the U.S. and expand two current facilities, creating about 5,600 new jobs by 2021.
The U.S. House Energy & Commerce and Judiciary committees have scheduled a Feb. 13 joint hearing to explore the merger’s potential impact on consumers, employees and the wireless industry. T-Mobile and Sprint executives are scheduled to appear.
In addition to FCC approval, the T-Mobile and Sprint merger requires approval from the Justice Department.
Critics of the deal have charged that Legere has already been courting favor with regulators. The Washington Post reported last month that T-Mobile executives including Legere have repeatedly stayed at the Trump International Hotel in Washington since the announcement of the merger, which would create a combined company valued at about $146 billion. Legere told the Post that he wasn’t seeking special treatment.
“It’s become a place I feel very comfortable,” said Legere, who noted the hotel’s location is near the Justice Department. “At the moment I am in town for some meetings at (the DOJ),” he told the Post. “And it’s very convenient for that.”
That is the same hotel that has raised concerns because it enriches President Donald Trump and he oversees the agency that holds the lease. The General Services Administration, which manages federal property, should have looked at Trump’s lease, Inspector General Carol Ochoa said last month in a report.
Emoluments clauses in the Constitution prohibit the president from profiting from foreigners or from getting additional compensation during his term. “GSA’s decision-making process related to Tenant’s possible breach of the lease included serious shortcomings,” the report said.
Source: Mike Snider, USA TODAY
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