Speaking at an investor conference last week, T-Mobile CFO Braxton Carter discussed the approval timeline for the carrier’s proposed $26 billion deal with Sprint, as well the 5G opportunity for fixed wireless broadband.
Carter said the Sprint merger, which is currently under review by the FCC and DOJ, could close as early as the first quarter of 2019, though second quarter is more likely.
“The only remaining thing that’s happening is depositions with the DOJ, which have started, and will be complete in a few weeks,” Carter said at the Morgan Stanley TMT Conference in Barcelona on Friday, according to a transcript. “And what we’re hopeful is we get some early indications of where these regulatory agencies are at by the end of this year.”
Carter reiterated that T-Mobile is “very optimistic” about approval, and noted the company has provided the DOJ with 25 million pages of documents, filed a 600-page public interest statement with the FCC, and engaged in numerous meetings with additional government agencies.
However, in outlining key takeaways from a recent antitrust and public policy summit hosted by MoffettNathanson, senior analyst Craig Moffett said regulatory approval of the T-Mobile/Sprint deal is not automatic, with several event panelists pegging the odds of approval at 50-50.
“The reasons for their concern were fairly straightforward: this deal would result in higher prices for consumers, be inconsistent with precedent and be a fairly easy win for the DOJ,” Moffett wrote in a Monday blog post. “If Sprint wanted to claim that the merger should be approved under a failing firm defense, that rule is very specific and only applies in the case of liquidation.”
Carter also took time at the Morgan Stanley event to touch on 5G fixed wireless plans. T-Mobile has previously said that the merger with Sprint will allow the combined company to offer fixed wireless broadband and deliver high-speed in-home internet service to greater parts of the country.
“Fixed wireless in a 4G world is more difficult,” Carter said.
Verizon first rolled out its fixed wireless 5G in-home broadband service Oct. 1, utilizing millimeter wave spectrum. Verizon CFO Matthew Ellis recently said the service has been delivering higher minimum speeds than customers were promised. At launch, Verizon said customers could expect average speeds of 300 Mbps and peak speeds of nearly 1 Gbps.
However, Carter said Verizon has caused confusion in the marketplace by positioning 5G as a mmWave band technology. He noted the new T-Mobile would use low-band spectrum for 5G fixed wireless.
“We’re going to commit to fixed wireless and bringing competition to that [in-home broadband] industry over a significant portion of the U.S. with a particular concentration in more rural parts of America that are very underserved from a cable plan standpoint,” Carter said. “And the primary mechanism that we would utilize would actually be a low-band spectrum. Remember, we bought the $8 billion of 600 megahertz spectrum, where the propagation characteristics in more rural parts of America can be very, very effective with 5G and fixed wireless substitution.”
The FCC is currently in the midst of its first high-band 5G spectrum auction, which kicked off Nov. 1. Carter acknowledged that “all forms of spectrum have a place” in T-Mobile’s “layer cake approach” of utilizing different spectrum bands to deploy 5G.
Carter also said that if the Sprint deal doesn’t go through, T-Mobile would have other strategic opportunities. He indicated that on a stand-alone basis, if Dish was interested in selling part of its mid-band spectrum holdings – “yes we [T-Mobile] would be interested in having that discussion.”
T-Mobile has also been active in proceedings regarding the Citizens Broadband Radio Service (CBRS) band and the C-band and Carter said the company will continue to participate in spectrum-related events.
“We will definitely be a player in everything that’s happening in the spectrum front,” Carter noted. “It’s the lifeblood of our industry. It’s absolutely critical.”
Read the full transcript here.
