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FCC formally approves T-Mobile-Sprint merger, but companies aren't out of the woods yet

Edward C. Baig, USA TODAY
The FCC has voted to formally approve the Sprint-T-Mobile merger.

It's getting closer.

The T-Mobile-Sprint merger cleared a major regulatory hurdle Wednesday when the Federal Communications Commission formally voted to approve the deal to combine the nation’s No. 3 and No. 4 wireless carriers. 

FCC chairman Ajit Pai, who had announced support for the merger back in May, joined his two GOP counterparts in favor of the deal; the two Democratic commissioners voted to oppose it. 

The Justice Department had given its own green light to the $26-billion deal over the summer, leading Sprint to sell its Boost Mobile prepaid carrier unit to Dish, among other concessions.

To placate critics, the would-be merger partners also have agreed to accelerate the deployment of 5G broadband in rural America to help close the digital divide. 

The consumer impact

Still, the impact on consumers remains uncertain. 

Opponents insist the deal will result in higher cellphone prices and a loss of as many as 30,000 jobs. 

T-Mobile and Sprint have long claimed otherwise and previously committed to not raise prices for three years. Sprint has also suggested in regulatory filings that, absent merger approval, its very long-term viability is in question.

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In voicing her opposition to the deal, Democratic Commissioner Jessica Rosenworcel said in a statement: “We’ve all seen what happens when markets become more concentrated after a merger like this one. In the airline industry, it brought us baggage fees and smaller seats. In the pharmaceutical industry, it led to a handful of drug companies raising the prices of lifesaving medications. There’s no reason to think this time will be different. Overwhelming evidence demonstrates that the T-Mobile-Sprint merger will reduce competition, raise prices, lower quality and slow innovation.”

Her FCC colleague Geoffrey Starks also weighed in: "You don’t need to be an expert to know that going from four wireless carriers to three will hurt competition. This merger takes a bad situation and makes it worse."

T-Mobile and Sprint aren’t out of the woods yet. Well over a dozen state attorneys general from both parties have sued to stop the merger on the grounds that it will be bad for consumers. While some have since settled, the legal proceedings are ongoing.

Email: ebaig@usatoday.com; Follow @edbaig on Twitter.

This article originally appeared on USA TODAY: FCC approves T-Mobile-Sprint merger as consumer impact remains unclear