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The U.S. Department of Justice has approved the T-Mobile and Sprint merger, meaning the two carriers have cleared a significant hurdle toward completing their $26 billion merger.
T-Mobile and Sprint will team up as “New T-Mobile” going forward, becoming a much more dominant third player in the U.S. telecom industry, the two firms said in a press release. The Justice Department approval comes after the planned merger, first announced last April, spent more than a year in regulatory limbo.
Both companies have promised not to raise prices for three years after the merger goes through. They also have committed to build out a coast-to-coast 5G network covering 97 percent of Americans within three years and 99 percent of Americans within six.
The DOJ’s green light came with a few conditions, however. The terms of the approval require that the New T-Mobile sell a handful of assets to Dish — including Boost Mobile, Virgin Mobile, Sprint’s prepaid business, and a portion of 800MHz spectrum.
Dish will also get at least 20,000 existing cell towers and “hundreds” of retail locations. That will position Dish as the fourth major carrier in the U.S. — a void that would be left by Sprint if the merger is completed. Dish has promised to roll out a 5G network covering 70 percent of the U.S. by June 2023.
Still, the merger isn’t quite finalized yet. It’s still subject to regulatory approvals and other closing conditions.
The Federal Communications Commission, for example, is still required to approve the deal. By all accounts, that looks likely to happen — but the official vote has yet to take place.
It’s also worth noting that a handful of states have filed an antitrust lawsuit to block the proposal. While several states have agreed to settle, New York and California are still pushing the lawsuit forward. That must be resolved before the deal can officially go through.
T-Mobile and Sprint still expect to receive regulatory approval by Q3 2019 and for the final deal to close by the end of year, however.
Interestingly, the new T-Mobile and Dish will also be required to begin supporting eSIM technology in an effort to make switching carriers easier for consumers.