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Only hours after FCC chairman Ajit Pai expressed his support for Sprint and T-Mobile's proposed merger, the U.S. Justice Department was reported to be against the deal over antitrust concerns.
The carriers have not worked hard enough to dispel Justice Department fears, a Bloomberg source said on Monday. Any merger must still clear the rest of the FCC and the DOJ's antitrust division.
Sprint and T-Mobile first agreed to a $26.5 billion merger in April 2018, looking to challenge the two biggest U.S. carriers, AT&T and Verizon. Some people immediately raised flags about the deal, noting that it would reduce national telecoms competition and potentially lead to higher data costs.
To appease groups like the FCC, Sprint and T-Mobile have already put forward several concessions. These include selling off Sprint's Boost Mobile brand, committing to a three-year 5G expansion and avoiding price hikes while that network is under construction.
The combined company would still control Metro and Virgin Mobile, however, and leave Americans with just three national postpaid carriers — potentially fewer in regions where coverage is weak.