US Wireless Industry Is Finally Competitive, FCC Says

For the first time since 2009, the Federal Communications Commission has concluded there is “effective competition” in the US wireless market.

The agency is required by law to conduct an economic analysis of the sector. Starting in 2010, after years of major consolidation among wireless carriers, the FCC declined to say whether it believed the industry was competitive. While the FCC had stopped short of declaring the industry noncompetitive, many industry observers still took it to mean the agency thought the nation’s largest carriers, AT&T and Verizon Communications, were too powerful. In 2011, the government blocked AT&T’s attempted buyout of T-Mobile US. Since then, T-Mobile and Sprint Corp. have been resurgent, stealing subscribers and transforming the industry by doing away with two-year contracts and bringing back unlimited data plans. AT&T and Verizon have lost customers and wireless prices have fallen by the largest margins on record, according to government data.

The FCC’s finding could have antitrust implications. If the wireless market is competitive, regulators may believe it could withstand another large merger. The nation’s smaller players, Sprint and T-Mobile, have been in talks about combining, people familiar with the matter have said. “A finding of effective competition certainly helps rhetorically for those trying to consolidate or trying to deregulate,” Harold Feld, a senior vice president at Public Knowledge.