FCC Chairman Ajit Pai’s recent announcement that he supports the merger of Sprint and T-Mobile with their commitments is welcome news. The merger will create a better-resourced combined company with a renewed focus on disrupting wireless with competitive prices and new innovations, and I believe the merger must be approved. As the CEO of a wireless provider serving hundreds of thousands of consumers, as well as a business partner with both Sprint and T-Mobile, I believe that together these two companies will keep prices low and innovation high in a highly competitive wireless industry, through their own products and services, and through the smaller partners they enable and support.
While critics of the merger claim that it will lead to higher prices and less competition, my 20 years of experience in wireless lead me to believe the opposite. T-Mobile and Sprint have demonstrated that healthy competition in the wireless space has less to do with the number of facility-based nationwide operators in the market, and much more to do with strong operating principles and enabling access and incentive for smaller competitors to utilize a robust nationwide network.
Beginning with operating strategy, T-Mobile has outpaced the market in customer growth for 21 quarters in a row on the basis of its “Un-carrier” strategy. This strategy is rooted in a very deliberate focus of addressing and resolving consumer pain points, such as restrictive policies, too-high prices and lack of transparency. As someone who has worked closely with both the T-Mobile and Sprint teams for years, I believe T-Mobile’s Un-carrier approach is deeply rooted in its organizational culture and its mission, not just its business strategy. I have every reason to expect that the New T-Mobile will continue to amplify its Un-carrier strategy and spark positive change in the market for consumers.
Healthy competition is a function not only of the number of players in a market, but also of how robust the opportunity is for new competitors to enter the market and innovate. This is especially true for the wireless industry, where many new entrants are dependent on partnerships with nationwide facilities-based carriers to provide access to their cellular networks.
Republic Wireless is a perfect case study of the innovation and consumer benefit that can flourish with the openness that both T-Mobile and Sprint have shown new entrants. In 2011, we pioneered the concept of WiFi-first mobile service, leveraging WiFi networks wherever possible and cellular only when necessary, to enable us to deliver some of the lowest prices in the industry. Sprint and T-Mobile were willing to be our first cellular network partners, and together we saved Americans hundreds of millions of dollars on their phone bills.
As a software and product company that happens to use an MVNO agreement to deliver innovation into the market, we know that our customers’ experiences will only be as good as the cellular network we utilize. As we look to the future, we’re much more interested in having access to a better combined network that is capable of delivering faster speeds and handling even more data. The combined resources and aggressive network plans that the New T-Mobile has promised will create a robust 5G network that will provide high-speed access and bridge the digital divide. This is incredibly important for our customers.
T-Mobile has committed to invest nearly $40 billion over three years and combine the complementary spectrum it and Sprint have in order to create a third network that will rival those of AT&T and Verizon. That kind of network, paired with a continuation of T-Mobile and Sprint’s openness to collaborate with innovative new entrants like Republic, is a strong recipe for massive value creation for American consumers.
New entrants and innovators also need flexible and decreasing rates and cost structures from their network partners to attempt new business models, as well as keep pace in the market. T-Mobile’s commitment to keeping prices low paired with the increased capacity of the New T-Mobile will create incentives for partnerships with even more new entrants and innovators, offering lower prices to attract more traffic to fill up the expanded capacity of their network. Ultimately, a stronger and more affordable third network, run by leaders with a strong track record of openness towards partnering with new entrants, will spur and provide the necessary foundation for the development and offering of the next generation of innovative mobile products for Americans.
Republic Wireless favors the merger of T-Mobile and Sprint because we believe that healthy competition in the wireless industry is driven far more by strategy, openness and economics than the number of national facilities-based carriers. We are genuinely excited about the prospect of serving American consumers with the New T-Mobile, a better resourced partner in the race to 5G, as it continues to welcome and support innovative smaller partners like Republic Wireless for years to come.
