Former FCC Commissioner To Handle $26B T-Mobile, Sprint Merger

Mignon Clyburn, the former FCC Commissioner, has just announced that she will be ‘advising’ T-Mobile amidst the company’s proposed $26B merger deal with Sprint awaiting approval from U.S. regulators.

“I’m advising T-Mobile and Sprint as it seeks to accelerate the creation of an inclusive nationwide 5G network on how to best build a bridge across the digital divide,” Clyburn said in an interview with Politico.

During her eight-year tenure as the FCC Commissioner which ended last year, Clyburn focused on the welfare of the minority and low-income communities. She has always looked at the benefit or human cost of her decisions on the perspectives of media regulation, access to broadband, and web neutrality.

The former Commissioner, who is also an Obama nominee, has previously fought against the bid of AT&T to acquire T-Mobile in 2011. At that time, Clyburn cited that the acquisition would not be in the best interest of the public.

Just last week, New York’s Public Service Commission approved the merger bid of T-Mobile and Sprint. The approval marks another milestone as they push closer to sealing the deal. The proposal has now reached 16 approvals out of the 19 state public utility commissions.

With the merger, the two carriers promised a considerable benefit for the consumers. They said that this merger would allow them to build high-quality networks faster to include the rural regions. While many critics contend that these companies are planning to compete with Verizon and AT&T for higher-income customers, Clyburn said that these carriers have already committed to serve the minority and the low-income communities once they merged.

T-Mobile and Sprint currently resell their services to smaller carriers which operate in the pre-paid sector serving mostly low-income and minority customers. Right now, 38% of the prepaid market is covered by T-Mobile while 16% of the market is Sprint. According to S&P Nielsen’s Jerry Rocha, 14% of T-Mobile users, and 15% of Sprint are black.

In 2016, T-Mobile’s customers were mostly those falling below the $75,000 annual income range. With the average household income of barely over $39,000 for the African Americans, data put the black community under T-Mobile’s scope.

Boost, the pre-paid service of Sprint, has 83% of its users under this income range based on the information from Kagan, S&P Global Market Intelligence data​.