Boost Mobile founder Peter Adderton vowed to save the prepaid segment from what he believes is certain collapse caused by T-Mobile and Sprint’s merger should the proposed consolidation be approved without major concessions being required from either firm. The industry veteran is now pushing for the Department of Justice and Federal Communications Commission to demand divestments from the two telecom giants before greenlighting the deal that would reduce the number of national mobile service providers in the country to three, arguing that any other scenario would be detrimental to prepaid consumers, traditionally the poorest class of Americans.
Mr. Adderton believes a tie-up of Sprint and T-Mobile would eventually lead to the combination of the former’s Boost Mobile and Virgin Mobile, as well as the latter’s MetroPCS, hence eliminating virtually all competition in the nationwide prepaid segment, leaving consumers without any affordable options. As Verizon and AT&T are barely present in the segment due to its thin profit margins, Sprint and T-Mobile joining forces would spell the end of any meaningful prepaid competition and hence warrants a federal intervention, Mr. Adderton said in a prepared statement issued earlier this week.
Boost Mobile founder hence committed to delivering a $9.95 monthly plan with unlimited 4G-based fixed wireless service, stating that competing solutions from the two combined companies and cable firms will likely be as much as eight times more expensive. The promise pertains to a broadband service targeting low-income families, with Mr. Adderton stating his new player in the segment would be prepared to deploy its own small cells and other infrastructure to support the future network. The veteran executive has been highly critical of T-Mobile and Sprint‘s merger attempt in recent months, though industry analysts remain uncertain about the likely outcome of the merger proposal, especially as federal regulators are still sending mixed signals on the matter. The FCC is presently accepting complaints about the potential consolidation, with the two wireless carriers hoping to finalize the deal in the first half of 2019.