House Judiciary subcommittee hearing on T-Mobile-Sprint merger covers Trump hotel stays, Huawei network equipment, and more

john-legere-house-judiciary-hearing

Today T-Mobile CEO John Legere and Sprint executive chairman Marcelo Claure once again testified in a hearing about the T-Mo-Sprint merger, this time in front of a House Judiciary subcommittee.

In his prepared remarks, Legere repeated many of the same benefits of the proposed merger that he’s mentioned before. These include helping to make sure that the U.S. “wins the global 5G race” and building out a faster and broader nationwide 5G network that neither T-Mobile or Sprint could build on its own. Meanwhile, Claure said that Sprint struggles to attract customers due to “network quality issues” and that it doesn’t have the resources to build a nationwide 5G network to compete with AT&T and Verizon. Claure went on to claim that Sprint and T-Mobile need each other to compete.

Other participants in the hearing included Christopher Shelton, President of the Communication Workers of America, who argued that an estimated 30,000 jobs will be lost if the T-Mobile-Sprint merger is approved. Gigi Sohn, a Distinguished Fellow at the Georgetown University Law Center, argued that 4-to-3 mergers in Europe have resulted in price increases, while Free Press Senior Policy Council Carmen Scurato suggested that the merger could reduce choice of lower-priced plans for lower-income consumers and Rural Wireless Association General Counsel Carri Bennet argued against the merger with regard to rural operators. Rounding out the participants was Technology Policy Institute president Scott Wallsten, who said that there’s little reason for the government to oppose the merger without evidence that it’ll lead to bad outcomes, and Christopher Yoo, director at the Center for Technology, Innovation, and Competition.

One of the first topics brought up during the hearing was Legere and other T-Mobile executives’ stays at the Trump hotel in Washington D.C. Reps. Hank Johnson (D-GA) and Pramila Jayapal (D-WA) asked Legere about the stays, with Legere saying that he was a longtime customer of Trump hotels and that it was his decision for executives to stay at the D.C. hotel after the merger’s announcement. “Do you understand the optics of that? What it looks like? It looks like what’s happening is that T-Mobile is trying to curry favor with the White House,” Johnson said. Legere said that he believes the merger will be judged by the FCC and DOJ on its merits.

The questions regarding T-Mobile executives’ Trump hotel stays is in regard to a Washington Post report that T-Mo execs had stayed at least 52 nights at the Trump hotel in D.C. in the 10 months since the merger’s announcement. T-Mobile has confirmed that it spent $195,000 at the hotel since the merger’s announcement out of a total of $1.4 million total that it spend at D.C. hotels during that time.

The subject of Huawei and security also came up during the hearing. Rep. Matt Gaetz (R-FL) asked if T-Mobile has any Chinese equipment in its network or if the New T-Mobile would use equipment from vendors like Huawei in its 5G network, and Legere explained that T-Mo does not currently have any Huawei or ZTE equipment in its network and that neither company will be in its future network plans.

Rep. Jamie Raskin (D-MD) brought up the issue of rural roaming, and Legere said that the New T-Mobile will honor the roaming agreements that both Sprint and T-Mobile have. Raskin also touched on jobs and potential job losses, like if Sprint and T-Mobile retail stores are near one another, and Legere said that the New T-Mobile will offer a job to every Sprint and T-Mobile employee. The CWA’s Christopher Shelton responded by claiming that promises of jobs for employees have loopholes and that 84 percent those stores are authorized retailers and are not T-Mobile employees and have no job promise.

Included in queries from Rep. Kelly Armstrong (R-ND) was a question for Marcelo Claure if Sprint can continue to be a viable nationwide competitor. Claure said that Sprint would need to spend close to $25 billion to offer 5G in its current coverage, which means that Sprint may have to borrow that money from a bank and possibly increase prices.

MVNOs were a focus for Rep. Joe Neguse (D-CO). T-Mobile has pledged that New T-Mobile will offer the same or better rate plans at current or lower prices as those offered by T-Mobile or Sprint and that those plans will be offered for at least three years after the merger, and Rep. Neguse asked if that commitment will extend to MVNOs. Legere reiterated that the New T-Mobile will honor commitments that T-Mobile and Sprint have and said that if any MVNO is concerned about not being able to get the rates they have now, Legere will lock in their rates right now.

If you’d like to watch the full replay of the hearing, you can do so in the video above.

The T-Mobile-Sprint merger is still under review by the DOJ and FCC, the latter of which recently paused the 180-day shot clock on its review of the deal to examine new documents submitted by T-Mobile and Sprint. Both T-Mo and Sprint have said that they’re confident that the deal will be approved in the first half of 2019.

Source: House Judiciary Committee

Tags: , , ,

  • Stephen J. Sundberg

    After the night I had, its obvious that TMobile can’t handle what they have. I’m against the merger because I already have high monthly bills and problems with upgrading my devices. Perfect what you have Big T!!

    • marque2

      Why don’t you switch to Verizon then?

      • Nathan Williams

        Becouse he will have a heart attack when he gets his first bill

        • Jason Caprio

          Verizon is only $5 – $15 more per month for an unlimited plan and you get vastly superior service. Hardly worth a heart attack considering all other expenses in life.

        • Acdc1a

          ONLY…Let’s go apples to apples. T-Mobile Essentials is $60 compared to $75 yes so that’s 25% MORE. Hardly a small number.

        • DILAW IDDAHLA

          So, $15/month ($180/year) will give someone a heart attack? I know there is a difference in cost going from Tmo to Verizon, but it’s not as drastic as some makes it. My house tax is going up next year by $197 and I didn’t have a heart attack

        • (J²)

          By that logic, no one should have any complaints or concerns with this merger or any others since small price hikes and fewer choices are not that big of a deal. lol

        • DILAW IDDAHLA

          It’s a deal, but not a BIG deal to cause a heart attack is all I am saying. I am against the merger, but for different reasons

        • Acdc1a

          If your taxes went up by 25% you’d be at your state capitol with your pitchfork you tool.

        • DILAW IDDAHLA

          Don’t use the % and forget the value. If you want to stick with housing taxes, then you do know that some cities have higher taxes because they provide better service and are safer than others. You are focusing too much on the % and not what you get in return / value If you buy Dasani water for $2 a bottle vs the Walmart brand for $.75, you reduced your spending by 63%, but it’s only $1.25

        • marque2

          Some cities have higher taxes and provide horrible services as well. Look at new York State – super high taxes and yet all the infrastructure is crumbling.

        • DILAW IDDAHLA

          It’s high for a reason and if the reason is not safety and service, then it’s for something else. Usually when the tax is high, there is demand and the demand is there for a reason. New York City is a money making city so income might be the reason

        • marque2

          Isn’t one tax and fees included and the other a charge with tax and fees extra? That adds another 15% or so in value.

        • Acdc1a

          Nope, I picked Essentials to better compare.

        • marque2

          There you go. If Stephen is having so many issues, he can go to Verizon.

        • Bklynman

          Last I check, doesn’t Verizon still charges a fee for smart phones? Taxes,this fee and that fee etc

        • dcmanryan

          $5-$15? What you smokin?

      • Stephen J. Sundberg

        I don’t switch because I have several devices financed already on Tmobile, I have lower income and great credit (usually) with Tmobile. It’s not in my interest to switch especially if Verizon requires a deposit or puts me on a contract. However, the illogical things I have been told by Tmobile in the last few days…I was seriously considering it. Tmobile fixed my S10 order so I’m not as upset but I still don’t think they treat their customers well. They quote policy and claim computer rigidity but they should be able to have common sense overrides and I shouldn’t have to talk to 40 people before something gets fixed! The merger will make it worse because the company can’t handle what they have already but overall service and store personnel are nice! Fix what’s broke then grab more assets! Thats all I am saying!

      • Stephen J. Sundberg

        BTW all your comments are funny! I have had Verizon in the past and I am familiar with the service and prices. I didn’t have a great customer experience there either so right now I have the lesser of 4 evils soon to be 3 evils. Less choice, more expensive. Less competition, less innovation. I think ATT and verizon should be split in half instead of all tis merging!

    • francob911 .

      I’m against the merger too. It would be better for everyone if T-Mobile and Sprint merge with a cable company instead.(spectrum,comcast, timewarner etc..) That way competition will still be in play. Less compitition means higher prices for us the consumers

      • (J²)

        Actually, no it wouldn’t.

        Paid TV, Home Phone Internet companies are as corrupt as Wireless was nearly 10 years ago.

        There’s literally no incentive to change the profitable model. Both Verizon and AT&T lead all 4 industries…

        Plus, it’s very unlikely that if T-Mobile or Sprint would merge with a cable company that there spectrum holdings would help with their current issues or innovation.

        This merger needs to happen.

        • francob911 .

          Just look at the history ex. What happened in Canada and France? They went down to 3 main phone carriers and prices just spiked up! Like if the 3 carriers got in some sort of agreement . That’s what basically will happen if the merge gets approved. Regardless if it merges or not T-Mobile service will only get better not worse.

        • (J²)

          This isn’t Canada or France. The issue is regardless, Sprint will cease to exist as we know it in the coming years. Would you rather the carrier be acquired by T-Mobile that has a proven track record of focusing on customer needs/wants and offering lower prices or a company like Comcast or Spectrum that does the complete opposite?

          You have to take your pick. There is no perfect scenario.

          Regardless, what we are so desperate to avoid by contesting this merger will happen regardless.

          Plans for 5G internet service and a internet based TV service will be negatively impacted if this merger does not go through. Yes, T-Mobile will continue to get better at the same pace it has but still leaving us with large players of Verizon and AT&T which also offer phone and internet (unlike it’s smaller rivals).

          We have to look at the entire picture, not just the parts that we are concerned with.

        • (J²)

          Honestly, it reminds me of the Time Warner Cable merger. We couldn’t stomach the idea of Comcast purchasing the company but Spectrum did. We ended up with fewer options, higher prices and enough poor customer service experiences to go around.

          Again, if we are going to get screwed let’s at least pick our poison because it’s going to happen.

        • Jak Crow

          We shouldn’t be having pick the least bad solution of bad solution if there was legitimate competition.

        • (J²)

          Unfortunately, technically speaking this is quite the opposite. The wireless industry requires spectrum to build out it’s network and roll out different frequencies and technologies. Spectrum is a finite resource. This is why years ago, we had a bunch of regional carriers. The only way to compete is to buy carriers to enter or strengthen the footprint in a market.

          The only way any of the carriers are going to be able to roll out 5G in less than 5 years is to acquire more spectrum or acquire a carrier or entity that has it.

          This is what happened when mergers go unchecked, eventually you end up in situations like these with many decades of mistakes that cannot be undone, all you can do is determine what is the best decision going forward. I do believe, to let T-Mobile acquire Sprint will even the playing fields and subscriber base – essentially a complete reset. Otherwise, Sprint will fall off and soon after T-Mobile will decline.

          Let’s face it, if Verizon deploys 5G successfully on a national level people are going to leave all carriers for Verizon. People want the best service for their dollar.

        • marque2

          Sprint is a non player already. If prices were to spike they would already have spiked. Exxon doesn’t change prices based on the one remaining “Olympic” gas station, of the once great chain.

          You guys are silly. T-mobile needs to grab that Sprint spectrum, otherwise it will go up for auction – either because they held it too long without using it, or because Sprint goes under, and then AT&T and Verizon will buy it all up, so they have no 5G competition.

          Also T-mobile because of rapid expansion, doesn’t have the tower density of other carriers, even Sprint in some cases. As an example T-mobile has two towers servicing, one at Yuma, and one at Gila for a 100 mile stretch of road on I-8. Sprint has 5 stations between these two points (Note that T-mobile has some voice and roaming on the stretch, but they turn off data near Dateland – so you can only make calls. If the merger went through Viola, T-mobile has 3x the towers on I-8. And T-mobile does have issues with reception on major interstates.

      • the martian ambassador

        The problem, I think, is that cable companies really push bundles to prop up the shrinking aspects of their businesses. I don’t want to be coerced into signing up for a “package” that includes wireless, cable, and home internet. You think cable bills are high now, wait until they get their grubby mitts on wireless companies.

  • Joe2050

    After 3 or so years they will eventually hike it up and offer less.

    • marque2

      I don’t understand why. I suspect in reality in 3 years they will have enough bandwidth to offer me home internet for 50 bucks a month and I can drop my $80 a month Cox plan. I also suspect they will – with Sprints spectrum be able to compete in the 5G market and therefore keep AT&T and Verizon 5G competing with lower priced plans, win win for the Universe. Lose lose for socialist Joe2050

  • Reagan1

    Wow, a little more than 10% spent at Trump hotels…call in the military. Such a dumb talking point. The merger will be approved and the naysayers can start whining about something else.

    • Acdc1a

      Probably had nothing to do with the short hike down Pennsylvania to the Capitol complex. Clearly a bribe. People need to get a grip.

    • alfonzso

      It probably wouldn’t be suspicious if John Legere (after merger announcement) hadn’t deleted the tweets from 2015 where he said he’s looking forward to never staying in a Trump hotel again.

    • spartanjet

      Its a valid point, and since Dump is using the office to profit I think its an important point to make.

  • rosedawg

    TDS is real folks.

  • Tony Chen

    sprint is dying they were at 55 million customer post paid now they are down to 32 million postpaid customers. sprint continues to bleed postpaid customers.

    • Jak Crow

      Sprint is doing what Tmo did when the merger with at&t was announced: coasting on life support, neglecting support and their network waiting for the merger to go thru.

  • MagicMiguel

    I just watched this and I don’t understand why the committee members spout their little zingers and then leave! They clearly don’t care about any of the points made other than their own. What a crock!