The US Justice Department is concerned that the merger could reduce competition for consumers and impact negatively on the US labour market
The US Justice Department has cast doubt over the proposed $26 billion merger of T-Mobile and Sprint, saying that it has a number of concerns regarding the deal in its current state.
T-Mobile is the US’ third biggest carrier behind AT&T and Verizon, while Sprint is the fourth. The proposed merger would create a new player capable of challenging the country’s big two operators for scope and scale.
While no official decision has yet been published, sources familiar with the matter told Reuters that the US Justice Department feared that the merger could reduce competition for US consumers. There are also fears that the merger would impact negatively on the US workforce.
Earlier this year, the head of the US’ biggest telecoms union warned that the merger could cost around 30,000 jobs, mainly in the retail sector.
“Trusting Sprint and T-Mobile with American jobs is like trusting a vampire at a blood bank,” Communications Workers of America (CWA) president, Chris Shelton said earlier this year.
The CWA estimates that the merger will result in around 30,000 redundancies, with 25,000 of those coming from the retail sector alone.
Both T-Mobile and Sprint have countered these allegations, saying that the merger would help to expedite the rollout of 5G services for consumers across the country and create jobs for skilled engineers.
US lawmakers are expected to reach a decision on the proposed merger y the end of June 2019.