April 2013

SoftBank said it expects to complete its acquisition of Sprint Nextel without fighting off Dish Network’s $25.5 billion cash-and-stock bid with a sweeter offer. But the Japanese company is looking at a profit of about $4 billion if the original deal doesn't go through.

SoftBank said that it was well along in getting approvals for buying the U.S. cellphone provider and expected to complete the original deal on July 1. SoftBank is considering several responses to the offer from U.S.-based Dish, including improving or otherwise adjusting the Japanese company's original $20.1 billion agreement to acquire 70% of the third-largest U.S. carrier, a person familiar with SoftBank's thinking said. SoftBank, Japan's third-largest mobile operator, has reason to play it cool with Sprint. Under the six-month-old merger agreement, SoftBank would receive $600 million if Sprint decides to back out. In addition, SoftBank has invested $3.1 billion in a convertible bond that can be converted at $5.25 a share. If Dish's about $7-a-share offer is accepted, SoftBank stands to gain about $1 billion from the bond. Finally, SoftBank hedged the remaining $17 billion it owes Sprint shareholders on completion of the deal at ¥82.20 to the dollar. The yen has weakened sharply since November, with the dollar fetching ¥97.86 as of Tuesday evening in Tokyo. At that rate, SoftBank stands to gain another $2.5 billion in currency gains.

The Federal Trade Commission said they would pounce on Google if they learned that the company, which dominates Internet search, violated the law after reaching an antitrust settlement in January.

FTC Chairman Edith Ramirez defended the agreement with Google at a congressional hearing. She told the Senate Judiciary Committee's antitrust subcommittee she fully expected Google to live up to its agreement, even in the absence of a court filing. "The agency will take appropriate action if Google does not," she said. "I share your concern ... that the voluntary commitments would create confusion over settlement practices at the commission. What I can tell you is that that matter should not be considered a precedent," she added. Bill Baer, the Justice Department's assistant attorney general for antitrust, whose agency shares with the FTC the work of enforcing antitrust law, was asked how the Justice Department would react if Google were found to break antitrust law. The FTC and Justice Department "would have a prompt conversation about who is best equipped to" investigate, said Baer.

Google’s competitors, clamoring for the European Union to press the search company to make global changes, face disappointment after the bloc’s antitrust chief said any settlement would focus on Europe. While confined to Google’s competition issues there, any accord to end the European Union’s antitrust probe that started in 2010 must stand the test of time and be impossible to circumvent, Joaquin Almunia said. Google this month submitted an offer to the Brussels-based European Commission that would create more distinction in Internet searches between its own services and those of its competitors, according to a person familiar with the talks.

“The U.S. and the EU have different systems and, on top of that, Google has a very different market position in the U.S., where its competitors have a market share of around 30 percent,” Almunia said in response to written questions. “In Europe, Google’s market share is more than 90 percent.” Rivals, such as Microsoft, want the EU to extract changes after the U.S. closed a 20-month investigation into whether Google unfairly promoted its own services in search results. The Federal Trade Commission in January concluded that Google was motivated more by wanting to improve its search results than by a desire to stifle competition.

The government’s process for shutting down a wireless network is shrouded in both secrecy and controversy.

Amid the chaos in Boston on April 15, The Associated Press erroneously reported that all cell service had been shut down throughout the city out of fear that other bombs might be detonated via mobile phone. In truth, cell outages had more predictable causes — massive use that overwhelmed the available bandwidth and interfered with calls, texts and Internet access. Still, the incident pointed to a little-known fact: The government does have a means of shutting down wireless communications and it has been done at least twice. But of course, the idea is controversial.

Objection is twofold — it may be unconstitutional and, also, it can easily disrupt rescue efforts and increase public anxiety. Even with overloaded circuits, cellphones were crucial to summoning emergency workers and allowing people near the blasts to tell relatives and friends they were OK.