The FCC today paused its self-imposed 180-day shot clock at Day 55 on its review of T-Mobile US, Inc.’s proposed acquisition of Sprint Corp. to provide additional time “for thorough staff and third-party review of newly submitted and anticipated modeling relied on by the Applicants.”
In a letter to T-Mobile and Sprint, David Lawrence, director of the FCC task force reviewing the proposed transaction, and Donald Stockdale, chief of the Wireless Telecommunications Bureau, said that “three separate developments require more time.”
They noted that last Wednesday, the carriers “submitted a substantially revised network engineering model. Although the applicants had previously provided a network engineering model as backup for certain network claims, you explained that since that time ‘the model has been extended,’ and that the newly-provided model ‘completes’ the prior work. Moreover, the Applicants asserted that this is now the ‘engineering model on which they rely in support of this transaction.’”
The FCC letter said the network engineering model submitted last week “is significantly larger and more complex than the engineering submissions already in the record. It appears to incorporate new logic, methodologies, facts, and assumptions, on a subject central to the Applications – the transaction’s claimed benefits. Accordingly, the Commission and third parties will require additional time to review it.”
The FCC officials also noted that in an Aug. 29 meeting at the FCC, “T-Mobile executives Mike Sievert and Peter Ewens described T-Mobile’s reliance on a business model titled ‘Build 9,’ which apparently provides the financial basis for the projected new network buildout. The Commission did not receive Build 9, and third parties did not have access to it, until September 5. Build 9 therefore requires further review.”
The officials also noted that “T-Mobile recently disclosed that it intends to submit additional economic modeling in support of the Applications, beyond that strictly responsive to the various economic analyses in the Petitions to Deny. This new economic modeling will also require additional time for review.
“We also understand that these models may interact with or support one another in ways still unknown to the Commission and third parties,” the letter added. “It will take time to evaluate, understand the relationships between, and prepare responses to these models. Moreover, those evaluations may also require additional information and explanation about the new modeling.”
Messrs. Lawrence and Stockdale said that the agency’s shot clock “will remain stopped until the Applicants have completed the record on which they intend to rely and a reasonable period of time has passed for staff and third-party review. The Commission will decide whether to extend the deadline for reply comments after receiving the remainder of the Applicants’ modeling submissions.”
“We appreciate that the FCC is taking the time necessary to fully understand the merits of the T-Mobile and Sprint merger,” T-Mobile and Sprint said in a joint statement. “The additional review time is common to FCC merger reviews and we recently supplied a large amount of data to the FCC that they want sufficient time to assess. We are confident that this transaction is pro-competitive, good for the country and good for American consumers, and we look forward to continuing to work with the FCC as they evaluate our plans.”
Last month, the bureau denied a request by 11 groups to stop the clock until the carriers supplemented “their public interest statement to adequately describe the extensive spectrum aggregation that will result from the proposed transaction” (TR Daily, Aug. 22). —Paul Kirby, [email protected]
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