Consumer advocates want the FCC to impose a phone unlocking condition on T-Mobile’s proposed acquisition of Mint Mobile, the MVNO made famous by part owner Ryan Reynolds.
T-Mobile last year struck an agreement with Ka’ena Corporation to acquire Mint Mobile and its affiliate brands, Ultra Mobile and Plum, for up to $1.35 billion. The acquisition remains pending.
Four consumer groups – Consumer Reports, Public Knowledge, Benton Institute and the Open Technology Institute at New America – suggest an unlocking condition could be modeled after a commitment that was tied to Verizon’s 2021 acquisition of TracFone.
The consumer advocates say the FCC should require T-Mobile to commit to a shorter unlocking period for all devices activated on its network.
“This would align with Verizon, which has been under a general open access and unlocking licensing condition related to devices operating on its nationwide 700 MHz C Block spectrum,” the groups told the FCC in a filing this week. “With respect to TracFone, Verizon’s 60-day unlocking condition applies to all 700 MHz C Block devices purchased from TracFone and activated on the Verizon network.”
It's worth noting that Verizon automatically unlocks handsets after 60 days, a policy it told the commission last year is “the most consumer-friendly arrangement in the industry.”
The consumer groups note in their February 5, 2024, letter to the FCC that T-Mobile has argued that unlocking requirements are “N/A” in the context of this Mint/Ultra acquisition because the company is already subject to the unlocking requirements of the Department of Justice’s final judgment in the Sprint transaction.
However, with respect to postpaid devices, the final judgment requires T-Mobile to unlock such devices only after a customer fulfills the term of the postpaid service contract or device financing plan or pays any applicable early termination fee. “The period to meet these criteria may amount to more than a year,” the consumer advocates wrote.
In T-Mobile’s situation, the groups suggest that within 30 days of closing, T-Mobile should unlock all devices purchased from its brands and activated on the T-Mobile network. For devices that are capable of unlocking automatically, such as Apple devices, they should be unlocked automatically 60 days after activation.
For devices that lack an automatic unlocking capability, T-Mobile should provide customers with manual means to unlock the device 60 days after activation. When that period expires, T-Mobile would then provide “clear and easy to follow” instructions as to how those customers can manually unlock their devices, they said.
The groups note that consumer advocates have long argued that mobile phones should come unlocked by default – it’s a lot easier to switch carriers if the device is unlocked. Locked phones, particularly those tied to prepaid plans, can disadvantage low-income customers in particular since they might not have the resources to buy a new phone if they switch carriers.
Transaction terms
In a presentation to the FCC last year, T-Mobile said all the brands it acquires will continue to operate post-closing and remain in separate subsidiaries under T-Mobile US.
As for what Reynolds' role will be once the deal closes, T-Mobile said that key Ka’ena personnel will continue to be involved with the brand and "Ryan Reynolds will remain Mint brand champion."