Ownership

It may have begun as a trade war, but the US conflict with China is increasingly becoming a technology war. President Trump’s decision to confront Beijing over policies that he says discriminate against foreign companies and distort global markets has become a battle for control of advanced communications and computing technologies. That evolution is taking the transpacific conflict into sensitive realms of national security and human rights, making a quick settlement an ever more distant outcome.

Justice Department staff members who’ve have been reviewing the proposed merger of T-Mobile and Sprint had recommended that the US government sue to block the $26 billion deal, fearing the combination of the country’s third- and fourth-largest wireless carriers could threaten competition. The recommendation came before the two companies offered new concessions meant to appease regulators, including pledges to divest certain lines of business and cap prices for consumers. Despite the recommendation, a decision to bring such a case has not been made.

AT&T CEO Randall Stephenson’s strategy [to synergize all of the company properties] is breathtaking in scale and scope, the largest transformation underway at any company in the Fortune 500. AT&T’s main traditional competitor, Verizon, has chosen an entirely different path, and Stephenson’s new rivals are in markedly different businesses. Stephenson marvels, “I spend as much time thinking about Amazon and Netflix as I do thinking about Verizon and Comcast now.”

Federal Communications Commission Chairman Ajit Pai has now decided that a handful of promises, made just days ago by T-Mobile and Sprint, puts this $26 billion transaction in the public interest. But these promises are speculative, unsubstantiated, and entirely unenforceable.

At a Senate Judiciary Committee hearing about data privacy and competition policy, GOP senators signaled they are divided over whether to pursue antitrust enforcement against the country's largest tech companies.

T-Mobile suffered a significant setback in its bid for regulatory approval of its takeover of Sprint after failing to win over the Department of Justice (DOJ) with a remedy package, putting pressure on the companies to offer more concessions.

Sens Bernie Sanders (I-VT) and Amy Klobuchar (D-MN) are criticizing Federal Communications Commission Chairman Ajit Pai's decision to greenlight the merger of T-Mobile and Sprint -- the latest sign that antitrust issues are core to many of their 2020 platforms. Sens Sanders and Klobuchar say a merger of the telecommunications giants would leave consumers with fewer choices. Sen Klobuchar, who is expected to publish a book on antitrust issues later in 2019, said the deal could harm competition.

Despite a host of concessions offered by Sprint and T-Mobile that won over Federal Communications Commission Chairman Ajit Pai, the fate of the deal hinges on the competition questions that reportedly continue to dog the deal at the Department of Justice. At the DOJ, deals are approved if they won't hurt competition, which is usually determined by potential impact on consumer prices. Discord between the FCC and DOJ is unusual, as the agencies usually collaborate and share information during merger reviews.

Federal Communications Commissioner Jessica Rosenworcel tweeted, "We've seen this kind of consolidation in airlines and with drug companies. But now the @FCC wants to bless the same kind of consolidation for wireless carriers. I have serious doubts. I'm reviewing the conditions that have been proposed by the carriers and blessed by my colleagues. You should have the right to do so, too. The @FCC should put them out for comment so the public can tell us just what they think about this new proposal."

Federal Communications Commissioner Michael O'Rielly tweeted:

While I generally withhold all comments regarding pending or prospective mergers, I find it necessary to clarify, at this time, that I am inclined to support T-Mobile/Sprint proposed merger, even if not convinced of the need for all the newly announced conditions being proposed.