US industry players gang up against T-Mobile/UScellularUS industry players gang up against T-Mobile/UScellular

This week the FCC received as many as four so-called Petition to Deny filings from parties keen for it to block the merger, underscoring the strength of feeling against it from many US telecoms stakeholders.

The filings came from major trade union the Communications Workers of America (CWA); mobile market newcomer Echostar; consumer advocacy group Public Knowledge, which teamed up with four other public interest bodies; and industry group the Rural Wireless Association.

At risk of over-generalising, everyone is against this deal apart from the big three mobile operators. And that's because it will – to some extent, at least – further concentrate market power with T-Mobile US, AT&T and Verizon.

The deal, inked in May, will see T-Mobile US pick up 4.5 million retail customers, spectrum licences that will boost its network coverage and capacity, and UScellular stores. Meanwhile, arch-rivals AT&T and Verizon have separately brokered $1 billion agreements to acquire spectrum from UScellular that was not included in the T-Mobile arrangement.

"A transaction that eliminates a competitor whose footprint covers nearly 35 million people, while also handing out the majority of its spectrum holdings to the top three wireless competitors, is harmful to competition and is contrary to the public interest," Peter Gregory, Broadband Policy Fellow at Public Knowledge, said in a statement accompanying the group's FCC filing.

Public Knowledge worked with Open Technology Institute at New America; Benton Institute For Broadband & Society; Access Humboldt; and Institute For Local Self-Reliance on a joint Petition to Deny.

"As competition authorities around the world, including the DOJ, have found, a market with a minimum of 4 competitors is good for lowering prices, propelling innovation, improving quality, and enhancing consumer choice," Gregory said.

He's perhaps clutching at straws a little there, given that the US can hardly be described as a four-player market at present. The would-be fourth national player, Dish – now subsumed into Echostar – is still struggling to find its footing; its finances and its customer base leave a lot to be desired.

It comes as no surprise, then, that Echostar is one of the most vociferous opponents of the T-Mobile/UScellular merger.

"Allowing T-Mobile to swallow UScellular and accumulate more spectrum would expand

the gap between T-Mobile and meaningful competition," the conclusion to its FCC filing reads. The filing focuses heavily on the spectrum imbalance it claims the merger would create and on the elimination of UScellular as the fifth-largest player in the market.

"This acquisition would only further entrench T-Mobile’s dominance, stifle innovation, hinder the development of a more dynamic and competitive wireless marketplace, and lead to further consolidation in the market," Echostar said. "By denying this transaction, the Commission can protect the public interest and ensure a level playing field for new entrants like EchoStar."

There was a similar message from the Rural Wireless Association. "This proposed transaction will not serve the public interest and will harm competition and consumers," it said. "The elimination of UScellular from the mobile wireless business will not only remove the nation's largest regional wireless carrier, but also a dependable roaming partner for rural wireless carriers."

Even the CWA, which represents tens of thousands of workers in telecoms in the US, including at retail outlets, focused as much on competition as it did on employee protection.

"The merger would harm the public interest by substantially lessening competition in local markets where UScellular operates, thereby hurting workers, consumers, and other rural carriers," it said.

"Just four years ago, T-Mobile secured immense market power when it acquired Sprint by making false promises about job creation and preserving competition. Instead, the company cut jobs, suppressed wages, and left workers afraid to speak out. Now, T-Mobile wants to continue its takeover of the industry by purchasing UScellular," added CWA President Claude Cummings Jr.

The CWA proposed a number of remedies it believes should be attached to the deal, should it be allowed to go ahead, largely based around workers' rights.

Meanwhile, Public Knowledge called for a series of conditions, including the imposition of a mobile phone unlocking requirement on T-Mobile, a minimum service speed threshold, a mandate for the telco to commit to pro-labour policies, net neutrality requirements, and commitments around low-income customers.

And the RWA asked for the reallocation of UScellular's legacy mobile high-cost support to other carriers that need it, and requested that the FCC ensure fair access to UScellular's remaining spectrum; require T-Mobile to enter into fair and reasonable roaming arrangements with other carriers where such arrangements existed with UScellular; compel T-Mobile to keep certain UScellular cell sites running; and require it to unlock UScellular's customers' handsets.

Clearly the many opponents of the deal are all singing from the same hymn sheet. It seems unlikely that the incoming US administration will move to block this deal, but the strength of feeling against it may well mean that it passes regulatory muster with a litany of conditions attached to it. That's almost certainly all the naysayers are hoping for.