The Kansas attorney general embraced the U.S. Department of Justices' decision Friday to allow merger of Sprint and T-Mobile to go forward in a $26 billion deal drawing opposition from consumer groups uneasy about consolidation of the wireless carriers.
Attorney General Derek Schmidt said Kansas joined in the Justice Department recommendation on formation of the nation's third-largest carrier, which must undergo final review by the Federal Communications Commission and endure a legal challenge in U.S. District Court.
"Our team has studied this merger and its effect on Kansas," Schmidt said. "I am comfortable with assurances from T-Mobile, Sprint and Softbank leadership of the merged company’s commitment to Kansas and to investing in our state to improve services and expand competition that will benefit Kansas consumers."
He said the new company would maintain a headquarters in Overland Park. Both companies are controlled by foreign businesses, with T-Moble tied to Deutsche Telekom in Germany and Sprint linked to SoftBank in Japan.
Avery Gardiner, the Center for Democracy and Technology's senior fellow for competition, data and power, denounced the Justice Department's decision not to challenge the merger on grounds it would reduce competition in the wireless sector. The organization supports action by 14 state attorneys general in a lawsuit filed to block the transaction.
"By failing to block this deal," she said, "the federal government is hurting American consumers, who rely on mobile connectivity every day. There is a ton of innovation that can only happen if we have vibrantly competitive wireless networks that bridge the digital divide."
Gardiner said consolidation in the highly concentrated industry would result in higher prices, more restrict cell service plans and lower quality.
The FCC tentatively endorsed the merger in May. The combined company would be known as T-Mobile and have about 90 million customers, but still trail industry giants AT&T and Verizon. Part of the sales pitch was the combined company would invest to bring speedy internet connectivity, known as 5G, to market sooner.