Hidden in Plain Sight: FCC Chairman Pai's Strategy to Further Concentrate the US Wireless Marketplace

[Commentary] While couched in noble terms of promoting competition, innovation and freedom, the Federal Communications Commission soon will combine two initiatives that will enhance the likelihood that Sprint and T-Mobile will stop operating as separate companies within 18 months. In the same manner at the regulatory approval of airline mergers, the FCC will make all sorts of conclusions sorely lacking empirical evidence and common sense.

FCC Chairman Ajit Pai’s game plan starts with a report to Congress that the wireless marketplace is robustly competitive. The Commission can then leverage its marketplace assessment to conclude that even a further concentration in an already massively concentrated industry will not matter. Virtually overnight, the remaining firms will have far less incentives to enhance the value proposition for subscribers as T-Mobile and Sprint have done much to the chagrin of their larger, innovation-free competitors AT&T and Verizon who control over 67% of the market and serve about 275 million of the nation’s 405 million subscribers.

[Rob Frieden serves as Pioneers Chair and Professor of Telecommunications and Law at Penn State University.]