America’s Biggest Wireless Union Pushes Against T-Mobile/Sprint Merger

In short: America’s largest wireless union, Communications Workers America, is pushing against T-Mobile and Sprint’s proposed merger, having asked competent Attorneys General to investigate how the consolidation would impact the industry in terms of job cuts and increased prices, among other concerns. In a new letter sent to all 50 state AGs, CWA President Christopher Shelton argued the union’s own analysis suggests the merger would destroy approximately 28,000 jobs across the United States, primarily due to a large number of duplicate retail locations the two carriers would have to eliminate. Broadband and prepaid segments are also set to be affected by a drop in service quality and innovation backed by an increase in prices if the tie-up is approved in its current form, the CWA argues.

Background: Many points argued by the union have already been raised by other industry watchers, particularly in regards to how the merger would essentially eliminate all meaningful competition from the prepaid segment where T-Mobile and Sprint are already the dominant forces. CWA does bring up a number of new arguments, including a national security take on the matter, with the union pointing to Sprint and its parent SoftBank enjoying a long-standing relationship with Huawei, a Chinese firm that U.S. regulators and lawmakers have been labeling a national security threat for years. While CWA didn’t attempt to make any conclusions on the matter, it asked for an in-depth investigation into the nature of any potential foreign interference in critical stateside infrastructure that could stem from the deal.

Impact: As the FCC recently paused its merger review deadline, some state AGs may see that development as an opening for an official probe into the matter, though it’s presently unclear whether any one of them would be willing to consider asking for an additional delay of the proceedings. T-Mobile and Sprint have also been criticized by their 5G argument, with several actors — including CWA — accusing them of being dishonest about the affair; whereas both claimed they were on track to be competitive in the 5G space this spring, they changed the story and now argue they cannot hope to take on Verizon and AT&T’s 5G services if they aren’t allowed to combine their operations, suggesting they were either dishonest with investors in the past or are now framing their merger pitch in a misleading light.

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