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Report: Possible Sprint/T-Mobile Deal Would Spark FCC Auction Rule Redo

Fri, 04/18/2014 - 11:10am
Ben Munson

If SoftBank-owned Sprint goes ahead with its plans to bid for T-Mobile, it would cause the FCC to re-evaluate and possibly change its rules for the upcoming 600 MHz incentive auctions.

FCC Chairman Tom Wheeler has reportedly proposed limitations for AT&T and Verizon Wireless, who together hold the majority of available low-band spectrum licenses. But the FCC based its rules on “current market structure” and would reconsider if a Sprint-T-Mobile tie-up proceeded, according to a Reuters report.

The FCC is currently planning to set aside up to 30 MHz in each market for smaller carriers to bid on once bidding for those markets hits a set threshold. After the threshold it hit, carriers holding at least one-third of the low-band spectrum in that market wouldn’t be allowed to bid. AT&T has railed against the proposed limitations, saying it could limit them from bidding in markets covering 70 percent of the population. AT&T has gone so far to say it might not participate in the 600 MHz auctions if such limitations are put in place.

AT&T may get its wish for an open auction should Sprint go after T-Mobile.

Although no official announcement has been made, SoftBank CEO and Sprint Chairman Masayoshi Son has openly declared there is a need for Sprint and T-Mobile to join forces in order to compete with AT&T and Verizon.

The potential merger has been met with skepticism from regulators who applaud the current U.S. wireless market landscape, with four large competitors, and wish to maintain the field.

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