T-Mobile US (TMUS) and Sprint (S) have been arguing in favor of their merger for quite a while, with both companies claiming that it is essential for them to combine forces in order to survive competition from larger rivals like AT&T (T) and Verizon (VZ).
Both the companies hope that their combination would help them expand into urban and rural areas as well as facilitate the deployment of the latest 5G wireless technology. Both firms have stated that although some jobs might be lost in the event of a merger, more positions would be created.
However, the merger has been facing opposition from a number of quarters. Dish Network (DISH) requested the Federal Communications Commission to not approve the merger on grounds that it would be better if T-Mobile and Sprint operated separately and that there was no sufficient proof that the pros of the partnership, especially the 5G benefits, surpassed the cons. Dish added that the merger could have a negative impact on pricing.
Dish said there was no sufficient proof that the pros of the partnership surpassed the cons
Apart from Dish, a workers union called the Communication Workers of America (CWA) has come out against the deal arguing that the combination would lead to the loss of over 28,000 jobs due to overlaps. This figure is much higher than the projection of just under 12,000 given by T-Mobile CEO John Legere on earlier occasions, and was arrived at by the union based on its own analysis using regional data.
The union also put forth the concerns related to competition while also stating that the companies were capable enough of operating on their own as was evident from their network and 5G efforts.
Aside from the concerns raised by these parties, the merger is likely to face scrutiny over issues like its ownership, the impact on its MVNOs and how much of its assets will have to be offloaded in order to gain approval.
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