The US Department of Justice opened an investigation into the potential effect of the acquisition of Sprint by T-Mobile US on MVNOs in the country, Reuters reported.
Citing anonymous sources, the news website said authorities were looking into concerns the reduction of the number of operators in the US market would raise prices for companies buying services on a wholesale basis. This includes nationwide MVNOs and regional or niche players.
After years of speculation and on-off negotiations, the US’s third and fourth largest operators agreed to merge in April, under the control of Deutsche Telekom’s US subsidiary. However, the deal will likely face a number or regulatory hurdles because it will cut the number of nationwide operators in the country from four to three.
Although the merged business would be better placed to compete with market leaders Verizon and AT&T, there are concerns about potential job losses and higher consumer pricing as a result of reducing the number of competitors in the market.
Assuming authorities wave through the deal, it is expected to close no later than the first half of 2019.