Some U.S. lawmakers have security concerns about T-Mobile-Sprint merger due to Sprint’s ties to Huawei

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Days after a Senate antitrust subcommittee held a hearing about the T-Mobile-Sprint merger, other members of the U.S. government have begun to express concern over the deal.

Members of the U.S. House have put together a draft letter arguing that a national security investigation of the T-Mobile-Sprint merger is necessary, The letter is being passed around so that it can get signatures before it’s sent to Treasury Secretary Steve Mnuchin, who is leading a security review of the merger.

The concern is related to SoftBank — the majority owner of Sprint — and its work with Huawei. That includes a joint effort between SoftBank and Huawei to show off the potential uses of 5G and an agreement between the two companies to utilize 5G “smart service robots”. The letter also says that Sprint violated an agreement that it made with the U.S. in 2013 as part of its sale to SoftBank which required Sprint to remove Huawei equipment from its network.

“The Sprint, T-Mobile merger would increase telecommunications risks associated with third-party foreign entities, including Huawei, being utilized in the development of U.S. 5G infrastructure,” says the letter, which was obtained by Bloomberg. “Recognizing that these companies operate as subsidiaries of foreign-owned firms — one of which maintains long-standing close ties with Chinese state-influenced entities — a full and robust national security investigation is required.”

The U.S. government has shown resistance to Chinese companies like ZTE and Huawei recently. Earlier this year, it was expected that AT&T and Verizon would launch the Huawei Mate 10 Pro, a move that could’ve exposed Huawei to more U.S. consumers and potentially given its marketshare here a boost. However, reports say that the U.S. government pressured AT&T and Verizon to stop working with Huawei over national security concerns. Considering all of that, it’s no surprise to hear that some U.S. lawmakers have concerns about the T-Mobile-Sprint merger due to Sprint and SoftBank’s previous dealings with Huawei.

Source: Bloomberg

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  • Hurlamania

    You knew Sprint would mess things up they can’t help it… They should have TMobile pay less for having to remove the Chinese equipment Sprint didn’t.

  • pda96

    Block it.

  • Dummy Up Meathead

    I’m not in favor of this merger, but this reasoning is nonsense. Absolute nonsense.

    • MastarPete

      It’s not nonsense. The Chinese government has much closer ties to companies or directly owns them. Remember how the NSA requested backdoors in US made equipment that went to other countries? Chances are greater than zero that there’s a backdoor put in place by the Chinese government.

      • Dummy Up Meathead

        Conjecture. State sponsored conjecture at that.

  • Bklynman

    I read on BRG,I think it call,how both Tmo and Sprint can’t keep doing what they are doing on there own because they don’t have the money,spectrum, etc, They gave the government in details about everything,not saying everything they told the government is true,but even if only half is true, both,of them are on brink of failure in a few years if this merger doesn’t go thru,have no idea if what they told them is true or not. Did not read this anywhere,not sure if this possible for them to do it even,if the government watch dogs are so concern about not having 4 major carriers, they call tell Tmo and Sprint to give up Metro,Virgin,Boost,let them merger to form a new company,now again I know how some people are on this blog,I didnot read that anywhere either online or off line,that would happen.

    • Francisco Peña

      Considering the work they would have to do to make Virgin and Boost’s CDMA (Sprint) network work with Metro and its GSM/LTE network, I don’t think those 3 would have the cash. Metro is owned by TMo, and Boost by Sprint, so its not tlike they have their own massive cash flow coming from somewhere.

      I also don’t think TMo is going broke/Failure as you mention. Sprint, sure. TMo, no.

      • Bklynman

        I will do my best to find the article,if i can I will post the link here then you can read it,just going by what I read,I don’t believe it either about Tmo,about Sprint yes.Good point about Virgin and Boost,and Metro. They would still have to do that anyway if this merger get the ok. Not sure how many customers those 3 have,don’t forgot Metro was it own company at one point,what I read about them when it was,zero customer service,bad service etc,just like Sprint,lol!

        • Trevnerdio

          While you’re looking for the article, the website is called BGR, or Boy-Genius Report :)

        • Bklynman

          LoL,that what it stands for? LoL!

        • Trevnerdio

          Yes hahaha I think they dropped the name years ago!

        • Bklynman

          It wasn’t BGR,thought it was,see my answer above.

      • Bklynman

        Sorry can’t find it,read it on my phone,when open up Google,they have articles base on the subjects you have read in the past,thought it was on BGR. It wasn’t.

        • steveb944

          For the future, if you go to Google Now the fourth option in the bottom is past articles. To the right of the magnifying glass.

    • Tony Chen

      t mo has a net profit of 7 billion this quARTER. last last quyarter they had 2 billion profit for t mobile they are fine

      • Bklynman

        Like i wrote just going by what I read.

  • Dharharr

    Bloomberg lol what a shoddy source. This is nothing more than fear mongering. Customers can just simply not buy a phone from Hauwei or ZTE.

    • vrm

      Huawei also makes network equipment and that is what they are talking about. In fact, Samsung and later Huawei are the reasons Ericsson and Nokia lost a lot of their wireless networking equipment business.

      Huawei also stole lot of IP from Cisco and screwed them in the router business !

      • Dharharr

        I stand corrected, I hastily assumed it only related to cell phones. Thank you and @SirStephenH for the info, I learned something today.

    • SirStephenH

      As vrm said, this is about network equipment, not phones and other devices. When a consumer connects to a cell network they have no say in or knowledge of what equipment is used. Insecure network equipment exposes far more people than a few insecure devices.

  • SirStephenH

    The answer is simple. Have T-Mobile agree to rip out and replace all of the Hauwei equipment as part of the merger being approved. Also, T-Mobile should renegotiate with Sprint for a lower price due to them having to incur the extra cost of doing something that Sprint should have already done in accordance with agreements already made with the government.