T-Mobile persuades Mississippi to switch sides

Mississippi
Mississippi expects better access to 5G networks after reaching an agreement with T-Mobile. (PIxabay)

T-Mobile seems to be working it state by state. Mississippi Attorney General Jim Hood announced that his office recently reached an agreement with T-Mobile, resulting in the state dropping its opposition to the proposed merger with Sprint. 

Mississippi was part of the original group of states that filed on June 11 to block the deal, with New York and California leading the effort. But having secured commitments from T-Mobile that include deploying 5G to more parts of the state, Mississippi is now on board.

Here are the commitments New T-Mobile is making, according to the AG’s office:

  • Within three years of closing on the merger, the New T-Mobile will deploy a 5G network in Mississippi with at least 62% of the state’s general and rural populations having access to download speeds equal to or greater than 100 Mbps.
  • Within six years of closing, it will cover at least 92% of Mississippi’s general population and 88% of Mississippi’s rural population.
  • The commitments include 5G service in rural areas, including but not limited to Amite, Carroll, Choctaw, Covington, Franklin, Greene, Issaquena, Kemper, Lawrence, Marion, Perry, Smith, Tippah, and Walthall counties.
  • The parties also made limited price commitments and, in discussions with the attorney general’s office, vowed to decrease prices as supply increased, particularly as Dish Network enters the mobile market.

“The world around us is almost fully digital, but Mississippi is lagging behind with internet deserts across the state,” Hood said in a statement. “My agreement with T-Mobile will help fill this gap, and I appreciate their commitments made specifically to Mississippi counties that lacked service. Access to the internet results in better access to education, jobs, and health care.”

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The AG’s office framed it as such: 5G technology is expected to drastically decrease latency or buffering, which will be more convenient for consumers and will enable access to valuable technologies in Mississippi, such as telemedicine, in ambulances and hospitals, and automated farming. The 5G internet service will be available to customers in their homes and businesses and beyond their smartphones, thanks to mobile routers.

However, T-Mobile also promised to roll out a broadband service that will be available to “hundreds of thousands of Mississippians,” including those in rural areas.

In conversations with the parties, the attorney general’s office also confirmed that there would be no retail job loss and that new stores would be opened in rural areas.

While the staunchest opponents are unlikely to change their minds, T-Mobile’s efforts appear to be paying off. Last week, Florida Attorney General Ashley Moody announced she was joining the U.S. Department of Justice along with 10 other states in support of the deal. Florida also ascertained commitments from the company, including around disaster recovery. The New T-Mobile is promising to double the number of available back-up generators within the state to at least 70% of sites within three years of the closing date.

RELATED: Trial delay worse for Sprint and Dish than T-Mobile: analyst

In a note to investors last weekend, New Street Research policy analyst Blair Levin said he and his colleagues don’t believe Florida’s entry into the case on the side of the DoJ will have any impact on the outcome of the trial, which is due to start in December. However, a more interesting question was whether the deal that Florida negotiated would tempt other states currently on the side opposing the merger to bolt from their position and join the DoJ. It appears that’s what happened with Mississippi, so it's worth watching to see if other states are equally persuaded.

Meanwhile, in a blog posted Tuesday, analysts at LightShed Partners said the Sprint/T-Mobile merger agreement will expire on November 1 unless the companies agree to extend the date—and they believe T-Mobile should use the expiration of the merger agreement to renegotiate terms with Sprint rather than extend it.

“T-Mobile already incurred costly concessions to obtain DoJ approval, and Sprint’s business is eroding faster than expected,” wrote Walter Piecyk and Jo Galone. “Now the deal faces an unexpected and difficult opposition by a coalition of attorneys general from 18 states,” led by New York and California. “This could layer on even more costs to close this deal. T-Mobile shareholders deserve an improved ratio.”

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