New York’s Attorney General is stepping up its probe into T-Mobile’s proposed merger with Sprint, concerned that the wireless giants could hike prices on cheaper prepaid services if they combined, according to an article in the NY Post (link below)
New York AG Barbara Underwood launched the investigation just weeks after T-Mobile and Sprint proposed their $27 billion tieup in April, sources said, reaching out to executives at companies that provide similar pay-as-you-go wireless services with questions about customers and pricing.
Underwood’s office is concerned that MetroPCS service and Sprint’s Boost and Virgin Mobile services are among the US’s most aggressive when it comes to price. Putting them under a single roof could send rates higher — and possibly out of reach for some customers, critics say.
In turn, sources say Underwood is beefing up her antitrust staff as her office eyes the merger. Last week, the Federal Communications Commission revealed in a public notice that Underwood’s office issued a subpoena to the FCC seeking all materials T-Mobile has submitted since announcing the merger.
New York intends to share those materials with other state attorneys general that are investigating the merger, according to the FCC notice.
Insiders say the prepaid market has emerged as a stumbling block for T-Mobile and Sprint. While a combined T-Mobile and Sprint would still be No. 3 in the US behind Verizon and A&T overall, their prepaid business would vault to No. 1.
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