Guest Blog by Irena Stevens and Jeff Hannah on the Colorado Impact of a T-Mo/Sprint Merger

Jeff Hannah and Irena Stevens team up on a look at how the proposed merger of T-Mobile and Sprint will affect Colorado Wireless.

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T-Mobile and Sprint to Merge, So What Does This Mean For Colorado Wireless?

Last month Sprint Corporation and T-Mobile US announced their intent to merge. While there is speculation as to whether or not the merger will be approved by either the FCC or Department of Justice (DOJ), if it is approved, what will the new Sprint/T-Mobile network operator mean for mobile carrier services in Colorado and the Colorado wireless industry?

Over the past few years, Colorado’s population has grown significantly in the Front Range’s metropolitan areas. This has required wireless carriers to increase investment in wireless infrastructure to extend coverage across the state and increase capacity in Colorado’s growing cities. This has been good for Colorado, as just two years ago Colorado’s most populated city, Denver, ranked dead last in mobile broadband speeds, with T-Mobile averaging 4.4 Mbps – well below 2016’s 9.9 Mbps national average download speed for LTE networks.

Today, Verizon and AT&T boast the largest in-state coverage maps, as is the case nationally due to both carriers’ robust spectrum holdings and capital investment. Of Colorado’s 104,090 square miles, AT&T covers 80,032 square miles with 3G coverage, while Verizon covers 76,182 square miles with LTE coverage. Though Verizon clearly provides the best coverage across the state, T-Mobile’s mobile capacity performance and coverage have grown significantly since 2016. In 2017, OpenSignal released data collected from users that placed T-Mobile’s average download speed for the Denver-Aurora-Lakewood areas at 13.94 Mbps, slightly ahead of AT&T, Verizon, and Sprint’s speeds. T-Mobile and Verizon tied for LTE availability.

For Coloradans in the state’s metropolitan areas, there is parity in LTE coverage and capacity amongst the Big Four wireless carriers. Within the eyes of the FCC and DOJ, however, the principle measure for whether or not to approve the proposed merger will be its impact on competition within the mobile broadband market. Considering the FCC announcement in 2017 that the mobile wireless industry is finally considered as truly competitive, the merger may become a reflection or a refutation of this standing. Within Colorado’s metropolitan areas, for instance, will parity among the Big Four support or detract from the case for merger approval?

The outcome might lie in what a merged T-Mobile/ Sprint means for rural mobile broadband coverage. Many of the Rocky Mountain states, including Colorado, would be well served by the merger. Within Colorado alone, T-Mobile holds 41 – 60 MHz of spectrum, while Sprint only holds 1 – 20 MHz of spectrum. Since much of Sprint’s spectrum holdings are high-band frequencies with limited ranges of propagation, Sprint’s existing consumers in rural areas would likely benefit from the network’s convergence with T-Mobile’s low-band spectrum.

The merger’s effect on the availability of jobs in Colorado remains to be seen. In the short term, expect increased contractor opportunity to update Sprint’s CDMA technology to LTE and integrate it into T-Mobile’s network. In the long term, there will probably potential eliminations of job roles and responsibilities, such as for suppliers, vendors, site personnel, customer service representatives, and business partners as the companies combine and streamline operations.

If the merger is approved, regulators may be incentivized to encourage a new fourth national wireless carrier.  Dish Network corporation is the fifth largest spectrum holder in the country. The company is currently investing in building a narrowband internet of things network, which could expand into a competitive mobile wireless service as 5G standards are become solidified.

Other cable operators have also begun to explore wireless carrier services. Late last year Comcast completed the deployment of Xfinity Mobile, a Mobile Virtual Network Operator (MVNO) service that uses Verizon’s 4G LTE network when Xfinity Mobile customers do not have access to Comcast’s over 18 million Wi-Fi hotspots. Charter has also drafted a similar MVNO arrangement with Verizon.  While Charter’s roll-out has yet to take place, there is speculation that Charter may have their own wireless carrier ambitions beyond a MVNO agreement. According to filings with the FCC, Charter is exploring the use of 3.5 GHz spectrum, in the Citizens Broadcast Radio Service (CBRS) band, to deploy LTE services.

Both nationally as well as in Colorado, the wireless competitive landscape is growing as much as it is evolving, which is why 2018 may be the year the T-Mobile/Sprint merger finally receives regulatory approval. For Colorado’s wireless customers, the merger will likely bring higher speeds and additional coverage to the new Sprint/T-Mobile customers, though not immediately. The impact on the current unlimited data plans is still unknown, but with John Legere positioned to lead the new combined operator, it is likely ‘Unlimited’ is here to stay – much to the dismay of Verizon and AT&T. For Colorado’s wireless industry, the merger will likely drive short term opportunities, but without the introduction of a new wireless carrier entrant, or entrants, that will require similar network investment as the current Big Four, industry consolidation will impact Colorado’s wireless industry in the years ahead. On the upside, with DISH headquartered here and with significant Comcast and Charter operations here, as well, there’s a lot to look forward to on the horizon.

Written By Irena Stevens and Jeff Hannah

Irena Stevens, National Advanced Spectrum and Communications Testing Network (NASCTN) PREP Program Associate at National Institute of Standards and Technology, Boulder, Colorado

Jeff Hannah- Corporate Outreach Manager, Interdisciplinary Telecommunications Program at Colorado University-Boulder and Master Degree Candidate

May 24, 2018

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