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tv   House Judiciary Subcommittee on T- Mobile Sprint Proposed Merger  CSPAN  March 17, 2019 2:19am-4:50am EDT

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2020. justicee alliance for and the heritage foundation discuss how president trump and senate republicans are reshaping the federal judiciary. be sure to watch c-span's washington journal, live at 7:00 eastern, sunday morning. join the discussion. >> on tuesday, a house judiciary subcommittee held a hearing with the top executives of t-mobile and sprint to discuss the potential impact of their proposed merger on the wireless industry and five g mobile networks. this is 2.5 hours. >> the subcommittee will come to order. the chair is authorized to declare recesses at any time.
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we welcome everyone to today's hearing on the state of competition in the wireless market examining the impact of the proposed merger of t-mobile and sprint. soat&t's dominant was entrenched that it was considered to be a lawful monopoly. a group to become the largest corporation in the world, controlling more than 80% of the market. it earned more than 53 billion dollars in annual revenue and was the second-largest largest employer in the united states behind the federal government.
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as a result, the system was broken into separate telephone companies while at&t's long-distance services were structurally separated from its device manufacturing services. the importance of the break cannot be overstated. if facilitated an explosion of competition in long-distance markets, lowered prices for consumers, improved products and services, and spread the creation of new jobs. for purposes of the hearing, the pressure resulting from enforcement led to the deployment of fiber optics across the country. the assistant of the antitrust division testified before the subcommittee in 1994 that at&t had copper wires across the country until competition enter that market. sprint and mci lay fiber-optic close to close. at&t followed them. she noted that there was no question that the speed of
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building the infrastructure for the nationwide internet was years and years ahead of where it would've been. when coupled with the , consumers reforms and small businesses saved billions of dollars each year while maverick competitors were incentivized to enter the market. fromargely to a retreat enforcement over the past several decades, there are only four national carriers today. which rink this market to just three national ineless carriers, resulting the combined company controlling nearly one third of the wireless market.
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consolidation is the way forward in unleashing competition. the competition that has been triggered by sprint and t-mobile has occurred in the absence of consolidation, not because of it. the pressure of competition is critical to building up the nation's internet infrastructure and improving quality for consumers. is evidence that additional consolidation would likely give the combined companies incentive and ability to raise prices, lower rages -- wages. mergers that significantly increase competition in a highly concentrated markets are presumed to be illegal. this transaction will significantly increase concentration in the wireless
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markets far beyond the level that the antitrust agencies considered to be likely to enhance market power. because of this reality, the only thing preventing merging price -- parties from raising prices are promises for a limited time. is ans hearing opportunity to examine concerns related to the current state of merger enforcement. it's been nearly a year since the fda last challenge the merger in court. has onlyce department challenged one significant merger. at&t's acquisition of time warner. been mind and controversy since day one. week, the new yorker reported that the president instructed senior white house officials to get this lawsuit filed against the at&t merger. following a series of reports suggesting the president seeks to wield antitrust laws as a
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political weapon to reward friends and punish enemies. response, the chairman and i are seeking the production of every communication document related to this case. we must get to the bottom of whether the white house has weaponize are antitrust laws. we will. for purposes of today's hearing, the merger is a critical test. is the antitrust division genuinely dedicated to promoting competition? this merger does not occur in a vacuum. working families across the country are struggling to make ends meet. parents lie awake wondering how they can afford their child's insulin. tople work triple shifts afford co-pays for prescription drugs. bank can a $50 in the be the difference between scrapping by or having the heat
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turned off. decades of consolidation throughout the economy has wiped out countless small businesses and hollowed out the middle class, resulting in record levels of inequality that have undermined social mobility in our country. corporations have converted monopoly into higher compensation for executives and made life unaffordable for many people. we have become a rent seeking society dominated by market power of large corporations and thed by powers power of workers has been weakened. it's every stagnant paycheck, every surprise medical bill, every overcrowded flight, every everyo the hospital, astronomical telephone and cable bill that is accompanied by a forced arbitration clause and
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horrible customer service. these are all reminders that america's monopoly problem has broken our economy and destroyed the american dream. we read stories of billionaires buying yachts that are furnished like palaces and as large as some elementary schools while men and women in uniform do not have access to affordable health care. the economic nightmare is exactly why democrats promised americans that we would crackdown on corporate monopolies for a better deal on competition. this is a top priority for me and a top priority for the house democrats to keep our promise to work for the people, to prevent big mergers that would harm consumers, workers and competition. i think our esteemed panel of witnesses for appearing before us today. i look forward to all of your testimony. i now have the privilege of recognizing the did -- the ranking member for his opening statement. >> thank you very much.
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i welcome the witnesses to today's hearing. it will examine the t-mobile sprint merger and its impact on the market and consumers. in the beginning, i am disappointed to hear the chairman put a partisan spin on this proposal even before we hear the testimony from the witnesses. certainly have not made up my mind on whether this proposed merger is in the public interest or not. this hearing will shed light on it. i do want to say, i don't think that antitrust questions should be partisan in nature whatsoever. i've been on this committee for 40 years. there are very few of these proposals that the committee has examined where republicans and democrats have been divided from the get-go. 2018, t-mobile and sprint announced a merger agreement that will look --
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change the telecommunications landscape. deal would, this combine the third and fourth
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wireless competitors and consumer advocates believe that they more concentrated wireless industry will reduce competition, raise prices, and result in job losses. under the communications act of 1934, we are reviewing the merger to make sure it promotes the public interests. the u.s. department of justice and state attorney general are reviewing the transaction pursuant to their perspective authorities. while congress has no formal doj or fcc merger review process, hearings like this provide an opportunity to ask questions to ensure great
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importance to american consumers. i look forward to the testimony of the witnesses and debate among members of the committee. wise decisions by doj and the -- andure a community competitive future for wireless medications in america. >> thank you. the chair now recognizes the chair of the full committee. i appreciate this opportunity to consider carefully the impact of the proposed merger of sprint competition,on consumers, and workers. i do not prejudge the merits of any proposed merger, but it is clear that this transaction will usher in significant changes to the market for mobile wireless services. given the fact that 95% of americans own a cell phone, and theire a mobile device of
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primary means of impacting the internet, it is critical to analyze any merger. as independent companies, they have each product innovative products to market. these products about only benefited their customers, but have benefited the customers of other wireless carriers whose own carriers have had to compete with us companies. for example, sprint and t-mobile's reintroduction of unlimited data plans and 2016 resulted in lower monthly bills and better internet taxes for millions of consumers. these companies have also provided a competitive service. i applaud both companies for the competitive efforts.
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in considering the proposed merger, we must determine whether this combined company would have less incentives to innovate and compete with other companies. concerned about any merger that would increase the concentration in the market that has already been highly concentrated. there are only four national wireless carriers today. as a result of this transaction, there would be only three. each of which would control about one third of the marketplace. therefore traumatically altering the competitive landscape. the combined company may no longer have any market-based incentive to lower prices and offer consumer policies once it becomes as large as the other two characters. this could harm other characters -- carriers who have benefited from the competition.
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the transaction would also consolidate the market for these services. it may disproportionately negatively affect low income households. this would be basically harmful in major cities, where large populations of middle and low income people. they may express even higher concentration in the market of prepaid phones. for their part, sprint and t-mobile offer a variety of justifications in support of this merger. they argue that the transaction would enable new t-mobile, as the company would because it, to supercharge for wireless competition. the increase scale would lead to better quality of the network and let it develop new products investors these. moreover, they believe that the merged company would be better in competing with the other wireless giants.
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that the anticipate new company would expand its workforce and invest up to $40 billion in the first three years after the merger. this may lead to the creation of more jobs and policies for consumers and new competition on the broadband marketplace thanks to the faster deployment of a nationwide fifth-generation or five g wireless network. these claimed benefits of the merger would be welcome developments for millions of employees and consumers. they should be viewed as -- with a healthy skepticism in light of numerous registry of sand that have made economic promises that were ultimately not borne out. that is one reason why i introduced the restoring and improving merger enforcement act, legislation designed to prohibit the spurious, unverifiable economic efficiencies adjusted by anticompetitive mergers. merging parties routinely justify anticompetitive mergers under the guise of corporate
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othercturing and efficiencies that are code words for widespread layoffs and reduce wages and benefits. create more efficient markets, ways of consolidation throughout the severalover the past decades have imperiled the financial security of american workers and consumers. result, employers have immense power to reduce the wages, benefits, neck about mobility of workers while consumers routinely pay higher prices for goods and services than they would in a more competitive economy. precipitoush the decline of collective bargaining, this massive consolidation has chunk the middle class and increased income at calder through stagnant wages and less economic opportunity. . i am pleased to say that states regulators are closely scrutinizing the transaction to determine what impact it might have on employers -- i same race
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-- on consumers and employees. to examine the important questions the merger raises. i look forward to hearing from our large panel of expert witnesses, including the ceos of both sprint and t-mobile. i think them for their participation. particular, those who have rearrange their schedules on several occasions to accommodate congressional complex -- confc i licts. i ask unanimous consent to but in the record a statement by the ranking member of the full committee. >> without objection. introduceleasure to today's witnesses. the first is john was there -- legere. before his time at t-mobile, he
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served as ceo of global crossing and had a corporate strategy and business development at at&t. he received a bachelor's degree and business administration from the university of massachusetts. he also completed harvard business school's management program. the second witness is the executive chairman of the board of sprint. he was recognized as a young global leader by the world economic forum. received degrees from bentley university. our third witness is the
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president of the communication workers of america. a native of the bronx, he joined staff is the tva -- in 1988. the fourth witness on our plan all is a disfigured scholar with the georgetown law institute for technology, law, and policy. for 30 years, she has worked to protect and promote cap edition policies that made the internet more open, competitive, and affordable. she previously served as counsel to tom wheeler. she received her bs from boston university and her jd from pennsylvania law school. is with theness free press.
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she received her ba from new york university and jd from villanova university school of law. generalwitness is counsel at the rural wireless association. representedhe has primarily rural wireless carriers. she is a member of the federal communications bar association and the american bar association. she has published numerous articles on wireless telik communication issues. she received her ba from north carolina state university and her jd from the columbus school of law at catholic university. next we have the president and senior fellow at the georgetown policy institute. his research focuses on competition, research, and technology policy.
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he is a senior fellow at the georgetown center. he received his ba in economics from washington university. is a professorss at the center for technology and atovation and competition the university of pennsylvania law school. his research focuses on regulatory law. we welcome all of our incredibly distinguished witnesses. like you for participating in today's hearing. if you would please rise, i will begin by swearing in. please raise your right hand. under swear or affirm penalty of perjury that the testimony you are about to give is true and accurate to the best
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of your knowledge? let the record show the witnesses answered in the affirmative. each of your written statements will be entered into the statement in its entirety. i would ask that you summarize your testimony of five minutes. we will begin with mr.leger. thank you for inviting me and the rest of the panel here today. the merger will deliver a supercharge carrier that will increase competition and create
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american jobs. first and foremost, the new t-mobile will make sure america wins the global 5g race. 5g will unlock new culpability will fuel job creation. 5g will completely transformed the way americans lived, worked, and travel. navigation,l-time downloading movie in seconds, and sunlight which translation, and much more. nearly every american business will the able to use it to revolutionize business. combining well create a better network. it will benefit consumers and businesses everywhere including in rural america. neither company can do this on its own.
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thenew t-mobile will have capital, scale, network to supercharge competition, unleashing significant benefits for all consumers including keep prices low. the combined company will continue the tivo old tradition of disrupting wireless space. and we will disrupt and how broadband with a new wireless mobile and and and -- in-home broadband options. that is creating a new broadband option for millions of americans who have none. and freeing millions from the stranglehold of big cable. budget conscious customers use the most state. many rely on their phones as the main point of axis to the internet. that means they have the most to gain when data cost plus. a newmobile will offer bridge across the digital divide. our opponents are wrong when they claim the merger will lead to higher prices.
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the upset his chair. the massive increase in our theork capacity will enable new t-mobile to win customers through better prices and lower services. it is been my business plan to do just that. i'm so confident that this merger will lower prices that we have committed to it. this merger will be a tremendous job creator. we will have thousands more employees than the standalone companies combined. our critics are wrong about the impact on jobs.
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we have heard this story before. they said we would cut 10,000 jobs when t-mobile merged with metro pcs. back, we expanded jobs by tens of thousands. to everyy this t-mobile and sprint employee working at one of our stores today. each of you will be offered a job. make no mistake, opponents of the transaction are fear thisring about transaction.
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over 200 organizations, companies, and government officials have publicly supported the transaction. i particularly honored that 11 congressman have offered a letter of support. un-carrier. we do not won of losing credibility and respect of our employees. we will deliver for our country. thank you and i look forward to answering your questions. it is truly an honor to be here. thisld like to take opportunity to explain why sprint's merger with t-mobile will be great for employees,
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consumers, and our country. want to tell you a little about me. i'm an immigrant. i emigrated to the u.s. as a young man from bolivia. i had very little money. i went to a small but great university in boston. i received a priceless education. i'm an entrepreneur. i graduated i founded a company and started selling phones out of my car. into the largest mobilephone distribution and supply chain company in the world. we work hard and grew over to $10 billion in sales. we have thousands of employees all over the world. i'm most proud that we made it the largest hispanic owned company and u.s. history. after i sold my business, i became the ceo sprint. companytime, the sprint was near financial ruin. in 2013 the company had lost over $5 billion.
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we had approximately $31 billion in debt. beginning in 2014, we undid a massive and painful transition of the company. we worked very hard from the ground up. is no longer in financial dire straits. but we saw the face serious challenges. as part of our success, we were able to fix our main challenge. the quality of our network. we could not fix it because of our poor financial situation. because of our network quality issues, sprint still struggles to attract lots of customers. many customers are required a faster paceat
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than our competitors. they're not willing to sacrifice quality. the u.s. wireless market has become a duopoly. toizon and at&t have close 70% market share and the control over 93% of the cash flow generating artistry. as a result, there's no way we can invest in compete at the same level. today, america and the world is changingnological point. five g and the standard connectivity will completely change the way we connect. but if sprint doesn't have the resources to build a nationwide network to compete against the duopoly. we need at least 20 to $25 5g and aret to have limited coverage area. generate any not cash flow, the only way to pay for this would be to raise more wet and to pay for that day, would have to raise our prices. we could no longer be the price later. the only world i can build the
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best 5g network is a combination of sprint and t-mobile. we can only do this at this merger is approved. we would invest $40 billion over the next five years to build the world's best 5g network. paco we do this together? it is the marriage of two pieces. sprint has high-capacity spectrum that it has acquired over years. t-mobile has broad national spectrum. build theallow us to most advanced network covering every network, every corner of america, in urban and suburban and rural areas. spent cannot do this alone. t-mobile cannot do it either. we need each other in order to succeed. america needs to lead the world in 5g. china has made it a priority to win the 5g raise. they are investing billions of dollars. when a country has the best network with the latest
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brings massive economic stimulus, explosive job growth, and a new wave of entrepreneurs. america's the land of disruptors. let's keep this way. my story validates this. this is the opportunity of a lifetime. we are committed to lower prices. we merge the two companies, we will create a times the network capacity that we would have on our own. we will have to beat at&t and verizon and prices to fill this the capacity. this makes financial sense. it is our commitment. it is true that most mergers did not create jobs. this merger is the opposite. this is a growth story. this new company will create jobs. blue-collar and white-collar jobs. jobs in urban, suburban, and rural america. we will need construction crews, call centers, and new sales
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reps. i cannot thank you enough for allowing me to speak today. as i mentioned, i'm grateful to this country as an american entrepreneur. i look for to answer your questions. >> i am the president of the communication workers of america. employeesnt 700,000 in telecommunications and other industries including or the 45,000 in the wireless industry. let's tell it like it is. would kill american jobs, the press, and raise prices on american consumers to enrich to foreign companies. members of the committee, that
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is economic treason. these are two of the worst these are two of the worst companies in the united states when it comes to the treatment of workers. they ship jobs overseas and in recent years t-mobile has been charged with more labor law violations per worker than even walmart. let's talk numbers. this merger would kill american jobs. we estimate that 30,000 americans would lose their job if this merger is approved. a wall street firm estimates that this merger would kill 20,000 jobs. whether you take their number or ours, you should understand that t-mobile's job creation promises are sheer fantasy. compete for-mobile each other for the same type of customers. often, low income households, which is why their stores are located near each other. sometimes right across the street. if the companies merge, chances are they would shut down one of the two neighboring stores most
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of those workers would be a job. and what about people like enough to stay employed? the merger will drive from wages for retail workers and as much as 2000 those per year. . employees -- employers compete for skilled labor. takeaway competition, and the remaining companies can throttle down employees compensation while jacking up prices on consumers. both are symptoms of the same disease. too much market power. that leads me to something the subcommittee and antitrust enforcement agencies i hope. our. we need to include the wage and job impact when analyzing whether a merger is anti-competitive. and we need to consider the impact of collective bargaining on jobs and wages. years, we have seen more and more megamergers.
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corporate profits declining. productivity is going up. executive compensation has skyrocketed. workers wages have not kept up. they have stagnated. highly concentrated markets and lack of competition are part of the reason. the weakening of unions is a powerful force to protect workers and wages is another reason for wage stagnation. as companies have gained market power through consolidation, workers have gotten weaker as a result of the war on labor. terms, workers have lost countervailing power. factors gohese two far to expire my wages and living standards have stagnated for u.s. workers. they help explain the dramatic increase in income inequality in the u.s., where the top 5% of americans control two thirds of our nation's wealth. the good news is that american can do some thing about it.
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mergerse can say no to like the t-mobile-sprint transaction and preserve competition and consumer and labor markets. bring backcan collective bargaining as a way to protect workers, not just union workers, but all workers. i have yet to hear either of these two corporate ceos time about remaining neutral to allow employees to decide whether to unionize free from their usual bullying tactics, intimidation, and antiunion propaganda. basically do not want worker status. enforcementt agencies in the courts can take into account the consumer price impact of a merger, they should be able to consider the impact of collective bargaining as a way to address anticompetitive effects and relevant labor markets. is not onlys merger bad for workers, it is a disaster for consumers.
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t-mobile and sprint are each other's closer rivals. iny compete aggressively particular for lower income customers and persons of color. by limiting this competition, economists estimate that prices will go up by 15%. while these companies trumpet the alleged benefits for rural america, their own sec filings show that even six years after the merger, 46 million americans , largely in rural areas, would not receive the benefits of its 5g network. thank you and i look forward to answer your questions. >> thank you for inviting me to testify today. when i was working for chairman
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wheeler in 2014, executives from t-mobile, sprint, and softbank visited the fcc several times to get their thoughts on a possible merger. chairman wheeler did not discourage them. but he was clear that they would have a tough time showing that the merger would be anticompetitive. a pioneer in the wireless industry, chairman wheeler had seen immense consolidation since 2000. thatlieves strongly reducing the number of wireless carriers would harm consumers their higher prices, correlated effects, and less innovation. the assistant attorney general for antitrust of the time agreed and said so publicly in january of 2014. later that year, after the parties abandon the deal, chairman wheeler said ford national wireless providers are good for american consumers. sprint has an opportunity to focus its efforts on robust competition.
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nothing in the intervening five years is all to the previous analysis of this combination would be harmful for consumers and the wireless industry. both are mavericks that forced competitors to adopt friendlier plans. t-mobile was the first to eliminate two-year contracts. to allow subscribers to unlock their phones. importantly, the companies compete with each other. this dynamic will change if the companies are allowed to merge. share similar to at&t or verizon, they would have haveincentive to competition and ability to cooperate with those companies to increase consumer prices. one analysis on the consumer price differences could be as much is 15%.
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the merging parties do not dispute that prices will rise, but argued that improvements to the service quality will be worth the extra cost. that is a dicey proposition because of the innovative people services. these kinds of prices will have a disproportionate effect. result in newuld t-mobile controlling about 43% approved markets. the market for services would shrink. the merging parties recognize these price increases. that is quite a remarkable thing to say about consumers for whom a next her $10 above would be a hardship. mergers and other countries have settled consumers with price increases.
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in the u.s., similar concerns about higher prices in the limitation of competition moves the doj to sue to block the merger in 2011. faced with overwhelming evidence that this merger will lead to higher prices, t-mobile has twice promised the fcc not to raise prices on its rate plans for three years. the mere fact that t-mobile believes it must make this commitment is an admission that post merger it would not be in enough competition to constrain prices. it also undermines the party's insistence that the merged entity would have so much capacity that it wouldn't raise regardless, the pricing commitment is riddled with ambiguities in the polls. neither the loop -- fcc or doj is capable to oversee this.
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the reported benefits of this merger are speculative. they would not outweigh the mergers harms. i would love to see more competition to big cable. but in addition to being too far and the future, this promises absolutely nothing to do with the market that is the subject of this merger. the market for national mobile wireless services. i'm a proud t-mobile customer and a fan of its ceo and its government relations team. but i'm not a fan of this merger. consumerse harms to far outweigh the supposed benefits. thank you and i look forward to your questions.
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>> thank you for having me. we strongly oppose this merger. our extensive research shows the duplicate our site harm it would cause to low income communities and people of color who are more likely to be on the wrong side of the digital divide and rely on mobile phones to connect to the internet. everything i say today is based on publicly available data. it may be clear, no matter where we look, nothing about this deals benefits, all of which are speculative and unenforceable, offset its immediate and permanent harm. they are the dominant providers of mobile service for low income people. daily incomesport
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-- yearly incomes of 25,000 dollars or less. two to structural and systemic racism, people of color are personally represented in the cymer graphics. t-mobile and sprint customers are far more likely to be people of color than at&t verizon. 45% of sprint customers identified as people color. the members of these communities these companies because their plants cost less. they compete with each other vigorously. they are each other's closest competitors. serve price conscious customers. but t-mobile and sprint have been mavericks in taking customers from each other and from the big two carriers after the government rejected proposed mergers. my full testimony touches on t-mobile's inflated 5g efficiency claims and exaggerated rumors of sprint's death used to justify the steel.
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but i will focus on three fax illustrating the harm to these impacted divinities. no matter how antitrust enforcers to find the product market, this deal would consolidate all highly concentrated markets. it was a limited choice for customers who need to play less for essential communication services. our document shows how t-mobile , touting eachpete other's innovations and exerting discipline on at&t and verizon. t-mobile and sprint both offer lower-priced options than their larger rivals. don't believe the funny math that having fear of competitors somehow strengthens competition. it would reduce choice for all lower-priced plans. customers toquire face discouragement credit checks. the merger would increase prices.
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in their filings, they don't even hide the likelihood that prices would go up for postpaid and prepay customers like. their own economic models say prices will go up. t-mobile's price pledge is riddled with loopholes and does nothing to allay this concern. they announced that legacy can -- plans would continue or until better plans that offer a better price or data are made available. this mockery of a promises meaningless. prices will stay the same unless they decide to raise him. just as t-mobile did with its initial attempts to hide this fact. the carrier gets to decide if a more expensive plan is better for you. even if it offers more than many customers might want or need or be able to afford. would mean merger consolidation in the wholesale wireless market. reducing wholesale supply with raise costs passed along to the regional customers.
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wholesale is used by carriers without their networks. throughout my career, i have been a strong defender of lifeline because it helps the most portable in society stay $9.25ted, providing just a month to defray the high cost. you should closely scrutinize the too good to be true claims made by these companies. you should consider the real world impact on communities that struggle with high-priced connectivity and often find themselves on the wrong side of the digital divide. thank you and i look for to questions. >> i am here on behalf of the rural wireless association.
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thank you for this opportunity to testify today on the impact of this merger on rural americans. we oppose this merger. it is bad for competition and consumers especially rural areas who will experience fewer choices, price increases, and substandard service. it should be denied. t-mobile has had more than 20 years to build out in rural america. they are making a lot of promises about how it will expand coverage and a america and improve service for these americans. but based on its track record, we have no reason to believe that it will do so. i will run through four areas of concern. first, roaming. arrangements are important for rural americans. roaming keep serving, suburban, and rural americans connected. sprint has historically worked with rural carriers to ensure they have robust wireless services. t-mobile has not.
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according to our members, t-mobile's roaming rates are higher than spent. -- sprint. go into will frequently unilateral agreements in which rural carrier subscribers can roam on t-mobile's networks with no possibility of t-mobile subscribers roaming on rural networks. keepile has chosen to coverage from its own customers and rural areas. in those areas, t-mobile's customers cannot be reached and are basically off the grid. do we really want new t-mobile 100 million plus discovers, more than one third of the market, the denied service in rural america? second, 5g buildout enroll america. t-mobile's repeated claims about this rural buildout are unfounded. when it comes to 5g networks and
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rural applications, like precision agriculture and remote health care, low latency is a must. the facilities needed for the sick algae cannot relate on satellite microwave. fiber must be employed. deploying fiber takes time and money. neither company has expended to layout fiber in rural america. the claims of building out future 5g broadband networks ring hollow. acquiring sprint does not give t-mobile the fiber in the is to serve rural america with 5g or in-home broadband. this will allow rural customers to work with both companies to more quickly buildout broadband. third, rural completion. best new year ago, the fcc found the t-mobile failed to correct ongoing problems with delivery
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of cultural consumers. t-mobile admittedly inserted false ring tones into these calls so that the caller believes the call was ringing on the other hand when it was not. despite breaking the law, t-mobile tendered rural consumers from running their businesses, communicating critical information to family and friends, and reaching emergency service personnel. this callous behavior in an effort to raise --. save money has harmed rural americans we believe their destructive behavior will continue. of the when its -- rivals sprint is illuminated. false broadband mapping claims. our mirror set serious concerns about the broadband maps. created to provide for provide billions dollars to mobile carriers to help the felt better and rural.
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the fcc asked carriers to submit maps. according to testing done by our members, when t-mobile submitted , the company vastly overstated its role coverage. when rural carriers want to test t-mobile's claims, 95.8% of the tests showed speeds below the threshold demanded by the fcc. many of the places where t-mobile certified it had coverage, cell towers and not even been put into operation. if not corrected, funding will not be available in these rural areas. as part of its publicans this review, the fcc must determine where t-mobile has been honest in its dealings with the fcc. our members tests show that is not. -- string ofing broken promises does not bode
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well for rural americans and this deal should be denied. take you and i look for to your questions. >> thank you for the opportunity to come here to testify on this thing merger. an economist and president and senior fellow at the technology policy institute. we are a nonprofit, nonpartisan think tank that focuses on the economics of innovation. we take no institutional position, so this testimony reflect only my views. the key question when pending the merger is whether the expecting efficiencies gained from combining the third and fourth largest wireless firms outweigh the possibility that the firm could perm -- hardcover edition. this merger involves more than the usual level of uncertainty because it involves a nascent technology just beginning to be deployed. because we know so little about 5g, claims regarding optimal
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market structure are speculative and difficult to evaluate. literature on days, mergers is inconclusive. . some find the prices increase, some find the presidency for his, and some find the president of change. the government has little basis for blocking the merger. and sprint maye serve more than 50% of wholesale and low income consumers, antitrust authorities should carefully consider the effects of the merger on his groups. the companies argue that combining forces will allow them to offer more 5g more robustly. anduating this claim whether it would benefit consumers is true -- if true is difficult because we know little about 5g supply animals nothing about the man.
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a market with more firms can spirit that's experimenting could lead to better outcomes. given the risky nature of investing in a new technology and likelihood of making mistakes, a market with fewer but stronger firms may yield better outcomes. previousd outcomes on mergers finds that even with the current technology, mergers do not consistently lead to one particular outcome. theseper that reviewed mergers found no effect on prices. that means we do not have consistent evidence that the merger would harm consumers or competition overall. the government has little reason to block the merger. opponents of raise concerns about low income and wholesale consumers. horizontal merger guidelines note that the government should consider a merger and how it will affect different customers. data shows they serve
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larger shares of wholesale and low income service customers. soldities-based providers best sell wholesale access. estimates suggest that t-mobile and sprint provide more than half of the wholesale connections. their annual report show increasing numbers of wholesale subscribers. not all people a plants rely on. networks and not all wholesale network-based plans are prepared. they are related but different. survey suggest that t-mobile and sprint directly serve almost half of the consumers of the annual incomes of less than $50,000. the true number is probably higher when considering wholesale.
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this is not necessarily a problem. whether it is is dependent on whether they could profitably raise prices. antitrust authorities who have access to the actual data should study the segments carefully and evaluate whether some adjustments may be necessary. the government can do a lot to promote competition. making flexible use of spectrum available. fec -- fcc should do away with impediments to progress. worldnot know what the 5g will look like. without evidence that the merger will likely lead to better outcomes, there is little reason for the government to oppose it. thank you for your time. happy to answer your questions. i am grateful for the
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opportunity to testify here today at the subcommittee's request. the proposedon mergers and perfect on rural consumers. the key to my analysis the growth and need for wireless spectrum. the proposed it can be divided into three different types. low band, mid them and high band. each of them serves a different role. low band spectrum is typically defined as those bands found below one gigahertz. well,s propagate very usually reaching a distance of 80 miles. it is able to penetrate buildings and does not require direct line of sight. spectrum typically covers for miles. it typically requires line of sight transmission but can penetrate facilities. moreband spectrum includes than 20 gigahertz that have been
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regarded as unusable. they're now being unlocked by improvement of technology. the range of high band is limited. it's requires line of site and cannot penetrate buildings well. higher frequencies to provide more bandwidth. will dependnt of 5g on the with of low band and high band microcell's. this is a -- particularly important in rural areas. low band spectrum makes it ideal for supporting coverage for rural areas. the problem is that because low band spectrum covers such large areas, the bandwidth it provides can be quickly exhausted. the shortages can be addressed by adding more. much of that additional more low pin spectrum will be wasted. the generally accepted technical
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solution is to meet the growing demand for bandwidth by adding smaller cells that rely on higher band spectrum in this places they are needed. range ofmile service mid-rant allows it to be targeted efficiently at those areas that need additional bandwidth the most. addiction ofhe these microcell's experiment is available in the population clusters in rural areas. using microcell's to determine present macro capacity for the customers for who macro cell service is the only option. success will depend on a 5g depends on a mix of higher band and lower band spectrum. sprint lacks the low brand spectrum able to provide 5g and rural areas. less lowlds four times band spectrum than other national wireless providers, as reflected in its weak performance in its lge network.
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the lack of low pin spectrum makes print port to serve rural customers. the low density population reuters makes it unlikely that the geographic range of midrange service will region of customers to be financially viable. the company resulting from the merger is planning a very different strategy from those being pursued by other national wireless providers. t-mobile is already using at 600 megahertz spectrum to deploy lte. as a mergers approved, the merged company plans to use low band spectrum that t-mobile obtained in the incentive auction. because the spectrum is newly deploy, the company will be able to convert these macro cells to 5g by configuring the software. those microcell's will not need spectrum assignments. the other national providers are following a strategy requiring
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high band spectrum. sprint's inability to provide services in rural areas explains why a bipartisan group of 13 house members have signed a letter supporting the .ransaction i find those gestures meaningful. i will be happy to answer any questions you have. thank you very much. thank you all for europe in statements. we will now proceed under the five-minute rule with questioning. we will begin with mr. johnson from georgia. >> i think the panelists for being here today. .legere, the day after the merger was announced, nine executives checked into trump
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hotel, is that correct? >> we announced our deal on april 29. on april 30, we came to washington as a leadership team for two things. one was to meet the fcc in the doj. the other was announce our quarterly earnings. >> i understand there was a purpose in coming. but the very next day, nine top execs checked into the trump hotel after the announcement, correct? >> yes. i made the decision. i am a longtime trump hotels stayer. well before this transaction. >> but the company had not paid for more than two nights a trump hotels prior to the announcement, correct? >> the trump hotel was only in existence for about a year. frankly, we had no reason. >> the bottom line is that only
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two nights have been paid for by t-mobile prior to the announcement. correct? d.c. the trump not counting tons of other hotels. announcement, $195,000 has been spent by t-mobile at trump hotel washington. t true? are -- is tha >> that is approximately true. do you see how that looks? you don't spend any money at a trump hotel. and then after the merger, you
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$195,000 at a trump hotel? >> that is not on that night. >> i am saying over the last 11 months you have spent that money. do you understand the optics of that, what it looks like? it looks like what is happening is that t-mobile is trying to curry favor with the white house. did it occur to you that members thehe public and congress, fcc, and president trump himself , did it occur that we would all see that expenditure as an attempt by t-mobile to gain acceptance by donald trump and
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has a ministration? and am 100% sure that this deal will be judged by the sec and the doj. >> i am just talking about the optics of what happened. staying atcs of meat the trump hotel have not changed in 10 years. >> it does not pass the smell test with the american public. it looks like you are trying to purchase influence. it could be a violation of the emoluments clause of the united states constitution. do you know if the trump organization or the trump campaign or the trump administration has attempted to contact the justice department to talk about this merger? >> i have no information about that at all. >> has t-mobile had any discussions with the trump
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organization or the trump campaign or the trump administration about approving this merger? >> i have not. i am not aware of any discussions by my organization. your company contracts with broadband providers? >> i don't understand the question. >> the rural wireless contracts with sprint and t-mobile for the use when ruralwers wireless customers are roaming, is that correct? >> that is correct. we provide service to rural carriers. >> those contracts will soon be expiring? >> that is incorrect.
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most of the contracts of self renewal. they are on different timelines. >> we the chair recognizes the ranking member for five minutes. thank you very much. where employees stay when they come to washington they have no relationship whatsoever to whether or not this proposed merger is in the public interest or is not. let me say, i'm kind of embarrassed sitting here listening to the gentleman from george's line of questions -- from georgia's line of questions particularly since the fcc is an independent agency. it is not a part of the agency or the administration, and the commissioners of the fcc are supposed to act independently based upon the data in the information and the testimony that is presented to them.
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having said that, as you know i certainly will stand up for the independence of the fcc and these other independent agencies. let's get down to whether this merger is in the public interest or not. mr.nt to ask the two ceo's, legere, i've been on this committee for as long as i've been in congress, which is 40 years. i have worked on antitrust questions, including the mixed at&t divestiture of the early 1980's, which was supposed to divide things up and ended up putting things were back together than they were before hand. i've come to the conclusion that european countries tend to put more emphasis on whether a company is too big and stifles competition, whereas here we focus on what is best for the consumer. 4-3 may stifleng
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competition but that's not what american antitrust laws are about. anyone that talks about mergers and things like that in europe, it is a different law. we ought to realize that. i would like mr. legere to say what can consumers expect out of this? and you say that prices will decrease as coverage, speed, and capacity continues to improve. in some ways, it kind of looks like that's mutually exclusive. that you get a better product that you pay less for but it seems to me that certain mergers, with the economics of scale and allow each of the partners of the merger who will be able to benefit from the strengths of the other and get rid of the weaknesses that they
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have. can the two ceo's answer that in the two minutes that i have left? >> thank you, sir. the transaction will provide a 5g network capability that the united states desperately needs. $40 billion will be invested by the coming together of these two companies. a merger usually is fearful. airlines are used many times where airline mergers have less supply, less legroom, more fees, higher prices. in this case, supply will go up dramatically. prices will go down. services will expand. in home broadband, competition will become. rural coverage and competition will expand. jobs will go up. every piece of what is good for consumers happens in this transaction. >> can you tell me what all of these things have to do with where you stay when you come to
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dc? >> they don't, sir. >> thank you. >> i think a good way to betray this is many times we tried to compare these mergers to others. there has never been a merger in wireless whereby mixing two companies because of our unique spectrum position that you are going to create eight times the capacity. therefore, nobody can stand here and say we are going to increase prices. when you have anything that increases the capacity by my -- by eight times, we have an economic interest to basically fill that capacity. the only way that the american consumer will move, at&t and verizon customers will move, is by us lowering prices. it is that simple. it is not what we say. we have an economic necessity as part of our business plan to lower prices to fill that capacity, which is going to be eight times what we would have if we were standalone. the reason why is because our
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spectrum holdings are able, when put together, to create eight times the capacity. >> thank you. i know recognize the gentlelady from washington. >> thank you to our panelists for being here today. i have been following the proposed merger closely because t-mobile is just outside of my district and many workers are inside my district. i know, mr. legere, that you've requested a meeting with my office and we've reached out and hope to do that next week. i do want to say to the gentleman from wisconsin that there is actually reason to look at this question of what happened at the trump hotel because it has been clear from quite a bit of reporting that president trump appears to have involved himself in the at&t - time warner merger, and we want to make sure that's not happening today. i want to refer to the letter
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that senator warren and i sent to you, mr. legere, and to thank you for your prompt response to that letter. let me just run through this quickly and give you a chance to give me quick answers because i want to turn to the merger after this. in 2015, you had a public twitter dispute regarding the quality of mr. trump's hotels in new york that ended with you tweeting, and this is a quote, "i'm happy to wake up in a hotel where every single item is not labeled trump in the books and tv's are about him." is that correct? just yes or no. >> that's correct. >> in august 2017, though, you did stay at mr. trump's washington, d.c. hotel. correct? >> that's correct, and many times in between as well. >> last april you announced the merger -- it was actually just once according to your letter that you responded to me, it was once between then and april when you announced the merger with
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sprint, and you knew the merger could not go forward without approval. so, you state -- you stayed there one time according to this letter that you sent me between august and april. is that correct? >> that is true. i had much less reason to be coming to washington. i hope that time returns at some point. >> great, thank you. the very day after the merger was announced, you and eight of your top executives were on a list of vip arrivals at the trump hotel in dc. correct? >> i'm not aware of that. >> that is per a january 16 article that has the details of that. in my letter, one of my list of vip arrivals at the trump hotel in dc. correct? >> i'm not aware of that. questions was how much t-mobile spent at the trump international hotel, and you kindly give me that number. can you please tell the committee what that number was? >> we spent $194,000 out of a $1.7 million spend at hotels in d.c. during that period. >> understood. i appreciate you have a big budget and you have to travel around and this is relatively
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small in the grand scheme of things. however, were you at all concerned that saying staying -- staying at the trump hotel so soon after the merger was announced, and according to reporting you have hired corey lewandowski to consult with you. is that correct? >> can i answer both of those? >> you can answer both of those questions. >> every consultant that we hire is completely disclosed and we had an organization that he has been affiliated with are not affiliated with but we have not hired corey lewandowski directly. the decision to stay at the trump hotel was my decision and is consistent with how i've chosen hotels in the past. >> you said you would never going to stay there. i am raising this because we unfortunately have a situation where the president has not disclosed his business interests. it appears that you may be
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trying to influence the president and something he dashed to get involved in something you should not be involved in. it causes concern for this committee. let me just turn. i would say if you want to this to be judged on the merits of the merger, which i think you want, we would expect they would have concern around anything that may shed a light of impropriety on the merits of the merger. let me turn to the merger itself. there are currently for big companies in the telecommunications space. verizon has 34% of the market. at&t has 33%. t-mobile has 18%, and sprint has 14%. mr. legere, i think both of you testified that critics who say that prices will go up and jobs will be lost are wrong. let me turn to you. you used to work for the fcc. you were an expert on antitrust policy. i would like to ask you, is it your opinion that moving from for companies to three will make the telecommunications market
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more competitive? no, it will make it less competitive and will raise prices on consumers as the sec's -- the fcc's record chose. mr. legere makes a lot of promises but as the senate side, -- said in an 18 paged single spaced letter, a dynamic ceo is not a couple legal commitment. >> i'm sorry, it is my time. i just wanted to end my testimony by saying both the netherlands and austria underwent 43 mergers and both saw price increases. i ask for unanimous consent to enter in the record both my letter with senator warren to mr. legere in his response back to us. >> without objection. >> i like to recognize the gentleman from florida, mr. gaetz. >> thank you, mr. chairman. i cannot believe what we are watching. the gentlelady from washington talked about how the substance of this merger is so important
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to constituents and then only reserved the remaining 50 seconds of her time to ask questions about the substance of the merger because we have to go into what kind of hotel tells -- what kind of a tells you -- what kind of hotel you like. i once said i would never stay in a la quinta again but i have. i would like to spend a lion shares time on the substance. an employee entered t-mobile into a testing lab and put a proprietary robot arm and walked out. -- into a laptop bag and walked out. with this in mind, does t-mobile currently have any chinese equipment in its existing network? do you plan to use huawei in the new five g network, and what is t-mobile doing to secure its network? ztewe have no huawei or plans. they will not be in our network now or ever. there was a robotic alarm that -- arm that was stolen in a
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lawsuit that we filed and we are very pleased for the things that the government is doing to ensure the safety around huawei. bennett, do your members contain lte equipment? >> yes. we have about 25% of members that have those in their network. they did it because they had universal service funding to spend and are trying to look for a low-cost, economical way to spend their money and did the deploy those in 2010 and 2011 before it became known that it was a problem. >> for the sake of cost, your members to have huawei and zte parts. set on your board? >> we have a representative on our board and has no influence over public policy committee or the board. >> it has come to my attention that some of your companies also use huawei equipment and have
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sites or towers in close proximity to military bases. is that correct? >> i believe that is correct, yes. >> as we moved to 5g, what plans do they have to remove that equipment and how quickly do you plan to address the national securities concerns? >> it is a very good question, and thank you. we plan to do what the federal government says we should do to the extent that that equipment needs to be replaced, we will plan to replace it. we will need funding to that -- to do that and have been in discussion with members of congress the sec and the -- the fcc and the administration on how to go about that without harming the real americans that live in that area by having them have no access to public safety services by putting equipment out of order. >> will t-mobile be requesting any additional government assistance to accommodate plans to not use the lower cost huawei equipment? >> no, we wouldn't. and frankly, we've even offered
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to play a role in the wireless association to help them possibly use some of our pricing power to purchase alternative equipment. >> as i understand it, some of the rural providers oppose the merger. if it were to take place, there would be more connectivity to come not from their providers but from t-mobile in that circumstance, and that would result in not having as much zte technology utilized in our technology and transfers of information. you would not require any additional assistance like the rural carriers said they would acquire? >> the existence concerns us. >> i seek unanimous consent to enter a cnn article march 11, "huawei connects rural america: could it threaten the most sensitive military sites?" >> entered without objection. >> i want to also asked about emergency response. we've been dealing with the aftermath of hurricane michael and we have seen in trips that we've taken where cities that
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have 5g technology have amazing capabilities in the event of disasters, especially for vulnerable populations by people in hospitals and nursing homes. can you speak specifically to how 5g will help local communities respond to disasters? >> that's an important question. resiliency is a combination of tower design and restoration capabilities. we have significantly invested in those areas, and that is a core part of the deployment of the new 5g network. in hurricane michael, the restoration capability and the investments that we made allowed us to have our entire network up throughout the disaster which is a principle of the design of the network. >> what would be an example of how g5 could save lives in a disaster? >> the 5g network, most importantly, the reach, breadth,
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and coverage will provide capabilities that are far more resilient and pervasive in their coverage. >> thank you, mr. chairman. >> the chair recognizes mr. raskin for five minutes. >> i am going to start with you. mr. legere said that 16 of 19 state agencies reviewing the merger have already approved the transaction. but i know there is still ongoing state ag investigations. are those agencies that mr. 16 legere cited as having approved the merger, are they responsible for determining if the merger violates antitrust laws related to the question before that? >> when the public utilities commissions and the state uphold this -- lookphold at this merger, they are not looking at the mobile wireless market. that's not in their jurisdiction. >> what are they looking at? >> they are looking at the small
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amount of wireline capacity involved in this. >> under state antitrust principles? >> that's correct, but they do not look like look out what is the main event, which is the mobile wireless market. with all due respect to pcs and psc's, the review is irrelevant. >> you're my constituent. do you live in carroll county? >> that's correct. >> which is the most rural part and most beautiful part and you are here on behalf of the rural wireless association, representing 50 or more wireless carriers. right? would this merger lower prices or increase prices, and why? what would the impact be in rural areas? such as where you live. >> from a rural american perspective, it will increase prices and the reason is because of the roaming agreement. each carrier has in a rural market, we only serve the very small areas that are little
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islands in rural america. when rural americans leave those areas to travel to cities they have to use a bigger carrier network. in the case of sprint, i've had members report that roaming arrangements are often 20 times lower than those with t-mobile so the fear is that if the merger takes place and the agreements that are in a place right now that some of them , contrary to what was said earlier, they are starting to expire, they don't automatically renew. t-mobile has not indicated they would renew those agreements. they've said we can select those agreements if they are going to expire in a couple of months and we are concerned about that. please let me finish. the pricing would go up for those rural consumers and we are going to have a situation where rural consumers will have good service at home with their local carrier and use a phone there for that service, but when they travel they will have to purchase another phone which means consumers will end up
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paying double. one for local home service and one for travel service. two phones to carry around. >> mr. legere, can you respond? >> just for the record, several times now, people are referring to what's going to happen to my prices. i'm going to be the ceo of the new t-mobile. i have are the taken a business plan to the agencies and financial markets. prices are going down. it's in my business plan and also promised in the commitments that i have made to the fcc. from a roaming standpoint, we have made it very clear we will honor the agreements that they have. 70% of all the roaming agreements are reciprocal. million -- a $25 million net payer. anyone that wants a roaming agreement at zero we will sign that right now. whether the rural carriers pass those prices on to their customers is a different story. but 96% of rural america will be covered by the new t-mobile network, which is also a significant contrary to the
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point that mr. shelton made. >> he also testified that the transaction would result in lower wages and thousands or tens of thousands of layoffs. perhaps hundreds of millions of dollars lost. are you willing to make the same promises to the workers that you are making to customers when you say prices are going to go down? are you promising that those workers are not going to lose their jobs or do you contend that they will? >> i would have to categorize everything mr. shelton said as bad assumptions and bad math. last time we were here in a hearing, mr. shelton said wages would go down but when asked what the wages were he said i don't know. we don't have an agreement with them. he has no -- can you explain it as a matter of economic theory? you have the two businesses across the street from each other and you take over the other business, why doesn't it logically follow half of the people are going to lose their jobs?
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>> if there is a sprint and t- mobile store in close proximity, even if we take one of the geographies and close the real estate it's highly likely we will need both sets of employees, because it is on foot traffic requirements. the other thing of a tell you is we are offering a jump to every employee. we also have a 60% attrition rate annually, and a 19% attrition rate at t-mobile.this is something we can take into consideration a handle . >> can i give mr. shelton the chance to respond out of fairness to him? >> your time is expired, but if mr. shelton wants to answer the question. employeesas promising a job, there are so many loopholes it is amazing. but when you look at what those of them are84% authorized dealers who are not employees of t-mobile and have gereromise even from mr. le
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that cannot be kept because they are not t-mobile employees. that is some idiot thousand people in the united states. some 88,000 people in the united states. >> i added 23,000 jobs in my tenure as ceo. i have added 70,000 jobs in addition to the 16,000.my track record speaks for itself. >> the chair recognizes mr. buck. and i will give you an extra minute if you need to. the witness took an extra minute. >> i wanted a ruling from the chair. i had dinner at the trump hotel three weeks ago. my stake was not cooked properly, and i sent it back, and it was then returned cooked really well. i am wondering if i have a conflict of interest. >> i think only if you are involved in a merger of two large companies.
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>> point of order. that means he cannot speak at this hearing. >> they are saying perhaps you cannot speak at the hearing. >> thank you very much, i appreciate that. first, mr. chairman, i would like to introduce a letter from a constituent of mine who is the company, andless wrote about the effect of this merger on rural broadband. he is very excited about this merger and continuing to work with t-mobile. is there any objection to entering this? >> without objection. >> thank you. thatt wanted to comment between the two of you, i am going with t-mobile just because he has better shoes. [laughter] i don't know if you have seen them. >> but he has better glasses. >> they are cool glasses. if they were a little pinker.
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i wanted to ask the gentleman from t-mobile and sprint whether you are planning on buying more spectrum as a result of this merger? >> the answer is yes. participatingare in a spectrum auction as we speak. there will be a lot more spectrum needed in addition to what we will get from these two companies coming together. >> do you plan on buying that from current holders of spectrum, or other areas in the marketplace? >> the significant amount of the spectrum we need to run this country -- company comes from bandow band and high portfolios we have. but as 5g advances, there will be a need to buy. you have made promises about pricing, and i am wondering based on those promises, do you
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believe that there is any role for any government agency in the pricing that you will be studying? i believe my commitments are enforceable, and i have made it clear. two things, i have a business plan that has prices declining. i have supply going up significantly. i have an 87% reduction in the cost of the data being sold. i have huge supply, i have a significant price decline capability, and i committed that to the fcc in writing in the first three years. >> i took an economics class in college, and i immediately went into law. [laughter] i wanted to just ask you to explain to the american public, makesree big companies for better competition in the marketplace than two big companies and two small
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companies? >> thank you, sir. i think you categorize that well. amongst the ways i look at this merger, going from two to three. by the way, after the number three and number four players come together, we will still be a much smaller number three to the economic power of at&t and verizon. why this makes sense is we will be able to significantly increase supply and bring competition greatly to those other two. the last thing i would say, we continue to ignore that the cable monopolists are in wireless. the comcast added more phone customers last year than at&t and verizon together. comcast, charter. dish owns a massive amount of spectrum that will come in. tracfone happens to be the largest in the market. there is more than just the three players. but going from two to three
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makes more sense than just having two. >> do you agree with that? >> 100%. we talk about the u.s. market being competitive, it's not. at&t and verizon have over 70% of market share. overis worse, they control 93% of the cash flow in this industry. think about it, how could you compete when you are competing against to companies that are generating $.93 of every dollar of profit? the only way we can compete is when we put our companies together. we build a better product, we lower our prices, we cover every corner of america. this is the first time that they are going to feel the competition. we are going to make this market more competitive, and this merger is proconsumer because everyone benefits. better product, lower prices. that is the basics of business. -- have thef you two of you put your heads
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together to figure out what color this will be? >> that will be magenta. >> i yield back. >> the chair recognizes mr. nadler for five minutes. >> before i start my questions, you look very eager to respond to the last question. >> i am very eager. keeps talking about unit price, and i think that is really important because what he is saying is the new t-mobile will give you more. is that saying that on a per unit price you either pay the same or less? you get faster speed, you get better quality, but in absolute terms, you will pay more. but on a per unit -- that is the word you just used. one hear excess capacity more time, i think my head is going to explode. that is seldom the only determinant of a pricing decision. market dominating entities can reduce output because it is more
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profitable to do so. carnegie owned all the railroads. he had lots of tenacity. he was still able novelist. the best -- he was still a monopolist. capacity is meaningless. >> here the question to mr. shelton. on everyconcentration sector of the economy has reached historic levels. last week, a professor testified in front of the senate that concentration has been steadily rising and competition declining in many sectors of the economy with concerns about increasing power. oft affect does decades consolidation, rising employer market power, and declining organization rights have on workers -- rates have on workers? it has put a downward spiral on wages. putlawsuit of unions has probably a bigger downward spiral on it. >> but the loss of unions aside,
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you think the concentration is a downward spiral. >> it has increased competition for labor. when you increase competition for labor, the labor prices go down. >> you mean decreased competition? >> i'm sorry, did i say decrease? >> increase? >> decrease, i'm sorry. >> and the prices go down is what you are saying? >> bright. as -- right. >> as you write in your testimony, their long history of violating federal labor laws, noting that t-mobile in particular has been a subject of more unfair labor charge as per employee than any other big business in the united states. that is quoted from you. how could the merger affect the new t-mobile's abilities to engage in unfair labor practices? >> that will become that much more powerful. this is a company that has been found guilty by various courts
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and they are already doing unfair labor practices. if you put them together they will be more powerful and do everything they can to even things out and will continue to. >> if you put them together they would not have less desire to do so? >> i don't think that would have more desire because they want to keep unions out. the only way that employees have a voices through collective bargaining and they don't want any part of that. >> that wouldn't change. >> cannot comment? i have one more question for someone else if we have time. in your testimony you note that the proposed merger would disproportionately cause harm to low-income communities and people of color. what are the harms that they are likely to experience as a result of the merger and why do you think they would experience
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those? >> they are going to experience higher prices. if you look at the record and the company's economic studies they show that prices are going to increase. >> increase because of consolidation? >> yes, absolutely. economists have compared t- mobile and sprint economist next significant increases. the harms of which are going to disproportionately fall on lower income subscribers. >> who did you say predicted that? >> their own economist. >> sprint and t-mobile economist? >> dish. dishes economist concluded that sprint and t-mobile's own economist predicted that which is what's in the sec record. >> thank you. >> legere asked for the time to reply. >> you wanted to apply-- is that what you said? >> if somebody says that we have said we're going to get higher
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prices-- >> i think that she quoted that this is quoting your economist. >> we have made a commitment that we are going to lower prices. we went above and beyond. people go and make a filing with the sec and we did that voluntarily. we are making a commitment because we have 8 times the capacity which is substantial. remember one thing. we are going to lower the price and the cost of our product bite 87% of the manufacturing cost. of course we are going to lower prices. if any industry in the world where you lower costs by 87%, therefore we have excess capacity and made a commitment to have lower prices.
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>> my time is expired. >> i recognize the gentleman from florida. >> the unanimous consent to enter northeast colorado cellular inc. direct to you. >> without objection. i recognize ms. demings for five minutes. >> thank you to all of our witnesses for being here with you. as i listen to all of my colleagues, i guess it's necessary for some to try to find humor when we are talking about american workers potentially losing their jobs and people of color once again potentially being taken advantage of. and persons who live in rural communities potentially losing adequate coverage. for some reason i'm struggling to find the humor in that.
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with all due respect to my colleagues who feel like where you stay is irrelevant, i do associate myself back to the comments originally made by my colleagues from georgia because we are talking about mergers that cost millions of dollars. billions of dollars. excuse me. i believe a compromise of the appearance or the appearance of compromise our undue influence and irrelevant to this conversation. mr. legere i'm going to start with you. in your testimony you said that this proposed merger would, and we referred to this quite a bit, lead to lower costs. it would be a tremendous job creator and would create thousands more jobs. under those circumstances when i hear what you say and when i hear what mr. shelton says, it appears to me that that would be a marriage made in heaven. but apparently, obviously the workers do not feel that way. if you would just, please if you've done it do it again for me because i don't see it quite yet and i'm struggling to see this, how does the merger, how
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does it actually lower costs? how does it become a tremendous job creator, and how do you create and will you create thousands of jobs that should make american workers and the unions that represent them extremely happy? they are not. >> thank you very much and i'm sure that the topics that you outlined, finding humor, i find no humor. we are the largest provider to people of color and low income and will be. they will be top beneficiaries of this transaction. rural america will be as well. we are going to create 5000 were rural retail jobs and ensure
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customer care jobs. we will have 1800 network immigration jobs and 11,000 new positions. we will have 3600 more employees in the first year then two separate companies combined in 2024. jobs are going up. again, mr. shelton's track record, when at&t tried to buy t-mobile he predicted it would increase jobs by 96,000. when t-mobile bought metro pcs i would submit that those are related to whether or not if we were created an organization. >> will you respond to that please? >> you talk about jobs going up and call center jobs, right now t-mobile ships jobs overseas
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every moment of every day. there is a tape wandering around the internet where the vice president of something is telling the people in the philippines that work with t- mobile in call centers that they are doing a great job because one year ago there were none of them, and now there's 1000. >> mr. legere is the merger american job creator or an american job destroyer. >> it is a significant american job creator. i would say to mr. shelton, i do have some offshore jobs and i will have some. >> you ship american jobs overseas every day as he indicated? >> absolutely not true. jobs in america are going up significantly every day in the new t-mobile. >> if i may, when you consider that 85% of the stores that are operated by authorized dealers
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not employees of t-mobile but authorized dealers, and then you consider that after this merger if it goes through, t-mobile sprint will have twice the number of stores that at&t or verizon has. what do you think is going to happen to those? >> i know exactly what i think. ms. sohn would you go ahead with the last few seconds? >> i want to list the promises i've heard today. wholesale access, prices, lifeline, and home broadband and jazz. it's like every day there's a new promise. my question is who is going to enforce these promises? i agree with the assistant attorney general that behavioral remedies don't work. they did not work in the comcast merger, they didn't work in other mergers. was going to enforce all of these promises? that's the problem. nobody is the answer. nobody is equipped. >> thank you so much mr. chairman. >> we now recognize the
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gentleman from north dakota, mr. armstrong for five minutes. >> mr. legere, we talk about the race to 5g and we've talked about it today. we all recognize that when we are competing in this we are competing with china and there is no real private business in china. they have a sense of unity and purpose as a country in these types of scenarios that we don't. my question is, what does it mean for the us to win the race to 5g? we are talking about short-term and jobs and those type of things, but a longer view of the economics of what this means , and that's before we get into national security questions. >> the statistics from ctia suggest there are millions of jobs at stake. if we don't retain and take leadership in 5g as we do with 4g we could use as jobs. $350 billion of investment and
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half $1 trillion of economic impact. right now, the us is behind china and south korea in the deployment of 5g. as you say, heavily because the country of china has a massive state run budget to deploy 5g as a critical national priority. with what we are going to do with the new t-mobile and $40 billion of investment and creation of the new wet network, -- network, forcing them to not have focus on millimeterwave sent small geographies, together we can lead the country to 5g and obtain that critical position. >> when we get into this technology i think it's important to recognize that we will pay $800 for a phone but not if there's one available for $740. that is the nature of the american consumer. when we start talking about where these processes are made, and the types of things that-- i mean, basic economics tell us more capacity should relate to
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lower prices but the 5g dates are 2021, 2024, and for everybody and, those seem way off. can we expect improvements in speed and performance and was critically capacity before then? >> the new network is going to have median speed by 2024 of 450 mb. by 2021 it will be 150 median speeds across the country. as i said, we are aspiring to cover 96% of all rural america. the promise of 5g is 100 times the speed and 100 times the number of devices and 10 times the latency. it's a major transformational step but even as we migrate to that, the new t-mobile speeds are going to be 15 times faster. >> my never-ending quest to educate people about north dakota, we have the best rural broadband in the entire country. when you deal with a success story for that north dakota is it. we do recognize that rural america is significantly
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underserved across the entire country. my question would be do you think sprint can delegate-- is continuing viably as a nation my competitor especially as we transition to 5g under the current structure? >> there will be a different sprint. in order for sprint to be able to offer 5g, coverage which is about half of at&t and verizon's coverage, we have to spend close to $25 billion. as you know, sprint already has $40 billion in debt. if we don't make any money we barely break even and would basically have to borrow that money from the bank and have to increase prices potentially. we would only be able to offer 5g in selected areas. the promise of 5g needs to be
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covered and to and to enable the new technologies that would come with 5g. sprint would be a very different company. why this is extremely relevant, is today at&t and verizon like i said before, have 93% of the profit and 70% of the market. if you shrink sprint to be a smaller company than basically the market share of at&t and verizon would grow more and the market dominance or market abuse that they have will eventually grow. the way to make it more competitive is by allowing sprint and t-mobile to merge to create a one third viable competitor that will bring competition to america. >> i think we can talk about what pitfalls will happen and how that looks to your current economic outlook. the type of company that you are now versus you are supposed to be in four years? >> we will be a smaller company as i said, and more importantly
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it will make the other two much stronger. as we talk about market dominance it will actually because a lot-- become a lot more dominant if that would be the case. >> ladies and gentlemen, i recognize miss scanlon for five minutes. >> dashed to address the impact on corporate consolidation on the public and i wanted to focus my time on the impact of the proposed merger on the consumers and workers in my district which is pennsylvania 5 , south philadelphia, all of delaware county and part of montgomery county pennsylvania. so i note that you are a villanova grad, mr. scurato. the testimony you submitted is the heart and to price conscious customers in low- income communities and communities of color. with that also include seniors?
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>> yes to the extent that they are price conscious customers that would include seniors. >> you talk about-- i'm sorry. losing my place here. you've got a chart on page 11 of your testimony that looks at major markets and the percentage of market held by sprint and t-mobile. can you expand the significance of the chart with her respect to the philadelphia region? >> absolutely. this is 1% of the market that sprint and t-mobile owned as a company, or that they own as a wholesale partner. it actually shows what percentage of the market they actually have in that district in philadelphia. >> what is the impact of a merger on the philadelphia region if they have, what is it, 46% of the market? >> the impact is that the price conscious customer does not have
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the robust competition between sprint and t-mobile in order to keep prices low. >> is this what you would describe as a highly concentrated market? >> absolutely. >> as i understand your testimony is that in a highly concentrated market, that elimination of choices is what tends to drive up prices? >> correct. >> mr. shelton, you have kindly attached exhibit a to your testimony that has the distribution postpaid and prepaid stories in various regions. one of them that you have highlighted there is philadelphia. do you have that? >> does that also show highly concentrated sprint and t- mobile coverage in retail stores there? >> t-mobile and sprint retail stores?
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what is the impact in your estimation of the impact of the merger on retail workers if the merger goes through? >> obviously as you can see, these are very close together and most of these prices. not only that but as i've said before, 84% of all of their stores are owned by authorized dealers, owned and operated by authorized dealers. when t-mobile says they are going to offer a job to employees, that doesn't mean anything to authorized dealers employees. and, when you have this many stores as i've also said before twice with eight-- twice with at&t and verizon would have, obviously they are going to get rid of some of those stories. those stores are probably going to be authorized dealer stores
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and the employees in those stores. >> okay thank you. we do have these concerns about the impact on consumers that less competition could lead to higher prices and consolidation of stores could lead to less jobs. so mr. legere, how is this for ministry merger desha for mac to 3 merger so different when we have the concern of lessening competition? >> going from 2 to 3 is going to increase competition in cities that have a high concentration of share, we run this business on nationwide advertising and nationwide pricing. we don't price particularly down to a neighborhood. in the lower end of the market when we bought metro pcs were the main concern was the same, metro pcs customers had a 12 times increase in data usage and 4% decline in price. the low-end of the market has been a high beneficiary and we would expect that to be. mr. shelton keeps talking about
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authorized dealers. a boost, virgin, and metro are headed heavily concentrated and authorized dealers. we've made it clear that we are going to run them as businesses the way they are now. we can't make job offers to employees that are not ours, but we can run these businesses. we can segment the market so that metro, boost, and virgin have a clear role to play and with t-mobile stores we can offer jobs to every person. >> i think ms. sohn was looking to respond. >> this is not a 2 to 3 merger. it's 4 to 3. you don't have to have equal sized players to compete. if sprint and t-mobile, and by the way t-mobile became t- mobile after the justice department locked the merger of at&t and t-mobile, that's when they became the carrier and wisely hired this man to my right.
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they are mavericks that not only compete with at&t and verizon but they compete with each other. as we've seen not only in europe, and i don't know why europe is different, i would think that if you are shrinking from 4 to 3 europe it's going to be worse in the united states. there's no rule that says that everybody has to be the same size. in fact, 3 is an invitation to collude rather than compete. >> the time is expire but we are going to get back to you. i want to go to the great state of colorado for five minutes. >> thank you mr. chair. i want to talk a little bit about mobile virtual network operators. correct me if i'm wrong but my understanding is that sprint is one of the largest providers of roaming contracts in rural
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america. is that a fair characterization? >> we provide to both mobile-- in rural america. they are customers. >> i represented district that's both urban and rural, quite a few counties in mine and the second district in colorado. while i understand t-mobile has made a commitment with respect to legacy rate plans for the new t-mobile, in terms of maintaining those for three years after the merger, and make -- am i correct that it does not extend to mdno 's? >> i will let the running of the new company answer. there's one enormous mdno and that something called tracfone. they have twentysomething billing customers and they have endorsed this merger and sent a
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letter saying this is good for consumers. >> i understand that. i don't mean to interrupt you but i will give it to mr. legere. i'm trying to get to the question of whether or not that price commitment will extend to this piece of the markets since that peace is a huge component of the ability for folks in rural america. >> i will go one step further. not only will we honor the agreements that sprint and t- mobile have. if there's any mdno concerned about them not having the ability to get the rates that they have, i will lock into a contract with any one of them that wants to take their rates and lock it in for as long as they want. prices will go down in that market as well especially since i can't think of a mdno agreement where prices went up or stayed flat. for someone who wants to lock it in, i'm your guy. i'm right out of the hallway. >> i want to follow up on a question that my friend from north dakota posed around the
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reasoning for this merger as it relates to sprint and its standing in the market. based off of what i've said the path that sprint is on is not sustainable in terms of the path forward. i think you referenced the gentleman from north dakota that sprint would have to be a smaller company. in my characterizing your statements accurately? >> that is correct. >> what i'm struggling to reconcile is this is a january 31 press release detailing the first-quarter results in the first quarter of 2018 and sprint. postpaid revenue grew year-over- year, prepaid service revenue grew year-over-year for the fifth consecutive year. net operating income of $479 million, 6 consecutive quarters of net additions, 10th
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consecutive quarters of net additions in the market. those do not sound like metrics of a company that would be growing small or getting smaller. it sounds like a company that is getting larger. maybe you can adduce-- the only metric that matters in business is whether the business has ability to generate cash or not. if you continue reading the press release sprint is expected to generate a negative free cash flow of $1 billion this year. a company that does not generate free cash flow does not have the ability to invest. a company like sprint is $40 billion in debt and the only way we can continue to invest is if we borrow more money. if we do that the only way to pay for that is that we are going to have to increase prices. prior to this merger the only way sprint will continue is basically by increasing prices. just to finish, as i've said we
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are generating negative free cash flow meaning we spend more money than money coming into the company. i want to give the witness a chance to respond but i would say, and again part of this is just recognizing-- reconciling the statements that the company has made with respect to financials with the justifications for the merger. that is what i'm trying to glean from your testimony. much of your written testimony focused on the need to be able to make more capital investments. in your press release you talk about the fact that network investments year-to-year have doubled which i understand are reduced in the years prior but nonetheless are on the rise. we've had a lot of conversations about 5g. i read the letter that was issued in the new york times just yesterday essentially to customers far and wide with respect to one of your competitors. in that letter it made clear to me that the plan is to be the
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first carrier that has mobile 5g later this year. i guess i'm trying to understand that difference between your company and that testimony. if you will indulge me to get the witness a chance to respond. >> the witness may answer the question but the time is expired. >> we do plan to deploy 5g in a limited area. we set it in specific areas in the country but we do not have the capability to offer it to the nation because we lack low spectrum to do it in other parts of the country. the metric that you see, sprint has gotten better. when we started sprint in 20 in 2014 we lost $5 billion. today that's barely breaking even which leaves us more to invest going forward.
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>> the chair recognizes miss mcbeth for five minutes. -- lucy mcbath for five minutes. >> we talked about the potential effects on this deal and obviously i'm not an antitrust lawyer. but it doesn't take one to see that there are real reasons to be concerned about how this proposed merger may harm consumers and workers. the economy relies on robust competition. my constituents in georgia don't need a law degree to tell them the difference between having 4 phone plans to choose from or 3. you do not need an economist to tell you that a company does not need to max phone stores on the same block but if you work at one of those that's about to close, and you are going to need a job. as was stated earlier by the communication workers the project that 28,900 jobs would
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be lost due to this merger. my question for you mr. legere is on february 4 t-mobile committed to make available then february 4, t-mobile committed to make available the same or better rate plans of those offered by t-mobile or sprint for three years. why not four or five years? why do we need this promise if this is such a good deal to consumers. >> thank you for the question. i am happy to explain. my business plan has prices going down all the time. the panel has said that our own modeling showed prices going up in the first three years. the build outis of the network takes three years. an economist inserted price pressure in the first three years as a theory as to what could happen. that is not my business plan. to do is to make
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a commitment. i will keep every rate plan that everybody has and keep it for three years. at the three-year point, there is no question from all the theoretical economists about will happen to price. >> do have a response? i want to repeat what i said earlier. commitment -- commitment is admission of the post merger does not going to be enough competition in the wireless market constraint pricing increases. it is saying i have got to make this promise, who is going to enforce these vague promises> ? after the letter, several people filed showing how many loopholes there were. t-mobile had to fire in -- file
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an eight page letter explaining why this was simple and ironclad. if you take eight pages to explain why it is ironclad, it is not ironclad. >> sprint and t-mobile have promised to offer employees new jobs if they are affected by a store closure. what kind of jobs might those be ? what kind of jobs with those individuals be asked to take? >> there is no way to tell what kind of jobs they might be. what kind of wages they might make. where they are going to work. where they will be forced to transfer to you to work. we still have 88,000 people who are through authorized dealers that have been promised anything. those stores are going to close. mark my words.
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>> at like to yield the rest of my time. >> thank you. theou care to pine on colloquially did he had earlier. >> it is true that in the third quarter of 2018, sprint had negative cash flow of $908 billion. they built up a large reserve of cash and they are spending it on. they spent $1.4 billion in the prior quarter. network.ir that is why they had negative cash flow. in the prior quarters, sprint had positive cash flow. nobody has talked about softbank. softbank is overflowing with money. $31 billion in cash. it's a vision fund has more than
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$90 billion in capital. there is more on the way. have an ipo. their listing the offering at $30 billion. there is money there. it just needs to be spent. >> can i reply now? >> the time of the gentleman has expired. i want to start with, there has been a suggestion. we are going from three -- from .wo to three which seems a really silly claim. t-mobile represents 18% of the market. sprint represents 14. three going from two to acts as if those are nonexistent players in the market. it seems that is clearly not true. we need to be honest, this is a translation -- transaction that
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takes for companies and makes it three. what is the impact on consumers and workers and cost from my perspective? i want to start with there has been a lot of discussion about the projected impact on consumers in terms of cost. i take mr. ledger at his word that he intends to keep customer down for the first three years. this is not just something decided by a single individual. this is a market that will have some impact on whether that happens or not. you have shareholders you are responsible to. you cannot say i will keep my place -- prices lower. there is a bunch of duties you have an market conditions. what i want to focus on is the testimony of mr. scarano who references testimony from t-mobile's economist. a firm called cornerstone, that acknowledged price increases are likely. i want to start with you.
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it seems like that was a conclusion that is consistent with other history in this sector and the reduction from four to three. would you explain a little bit about that response. in the study, it speculates lower income customers may be more willing to pay for better service and higher income customers because they rely on smartphones for their only access to the internet. that is part of the cornerstone study. when looking at the study, they own concluded that the economists have predicted significant price increases. those are going to personally impact low income consumers. applaud both t-mobile and sprint have been crafty,
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aggressive players in this market and it has resulted in, maybe not better experiences, may be better experiences for consumers, lower costs, more innovation, more choices. that is what competition is intended to promote. that hard to understand prices will go up and what we know about antitrust law that less competition produces higher prices, why is this anticompetitive and not in the best interest of consumers, american jobs, or prices? >> thank you. you did refer in the beginning about being a ceo and the obligation to shareholders. i made it clear that the business press plan i have shown has price declines from day one down.
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not what we keep your about here is getting credence to dish, doing economic modeling. >> is not dish, it is your economists. cornerstone. >> dish is interpretation. one of the reasons it stopped is we provided tremendous amount more information about the years 19 to 21. prices are going down. if you give me the chance of a collusion comment, if i can make this comment, t-mobile has done a great job. it did not just come what hard work. we got $3 billion worth of cash spectrum from the at&t breakup. and we did a merger with matt -- metro pcs. the rent is all about taking it to at&t and verizon. those two would not speak to me a thousand a dark room alone with them. whetheroal here is not
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or not you get to take it to at&t and verizon. our goal is deciding whether or not this merger makes sense in public interest. if it is good for consumers, american jobs. whether it will result in lower prices. i get the competition view. that is not part of the equation. does it produce more choice, more competition, lower prices for consumers? >> which it has, in the years i have been ceo. >> you keep saying this three year window. i take it that even you don't, are not even able to make and -- >> prices are going down. >> forever. >> business plan. >> that does not seem credible. you will not be there forever. that is what was worrisome. i don't think we can be looking at transactions like this and basing and approval on your
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personal judgment or sense that you will behave in a certain way. >> there will be an eightfold increase. 87% decline, unit cost will go up. 10 times more data. myself, thedulge folks who respond to this idea, you talk about the representations that were made by t-mobile and sprint to wall street and how that ought to be relied upon. but also how it conflicts with your own analysis. thank you. it is axiomatic that companies seeking to merge will tell wall street that everything is wonderful. we talked about that specifically with sprint and -- did a great job of talking about how 2018 was a banner year. and the third quarter we delivered solid financials.
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that is one example. we can talk about the 5g. 5g, that is not merger specific. most companies have been promising premerger, a nationwide 5g network. beenis what they have telling wall street. now they will tell you it is deeper, stronger, bigger. use your adjectives. that is what they have been telling wall street. if i could. i would not mind just finishing. i think it is important to note that both are putting their money where their mouths are. they are committing five to $6 billion annually. billion thathe $40 they talk about this merger is consummated. is so muchint, there talk about the race to 5g. ask at&t. ask chairman pie.
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.sk abi research they all think that u.s. is winning. they will win. they will win for at least the next two years. i would not worry about losing the race to 5g. these companies are investing boatloads of money. >> i find the comments that were made about public company ceos saying whatever they need to say to wall street markets insulting. it is a legal obligation we have to say exactly what is taking place. in the 5g integration of the two companies is dramatically different. >> i understand. i think we are trying to reconcile different presentations. you have made reference to the impact of this transaction. you made reference to people being underrepresented in these companies. i disclose my own bias.
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when people are represented by a union they are -- they earn better wages and benefits. we don't want to just preserve jobs. i wonder if you would be my final question to talk about what is the impact on jobs and your assessment? an assessment that demonstrates significant job loss. the aggregate may be as much as $543 million in losses to workers. one of the big priorities is doing everything we can to protect good paying american jobs. first of all, on the jobs, we believe there will be 30,000 jobs lost if this merger goes through. we are not alone in that. there are some wall street firms be not 30,000 come
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about thousand jobs will be lost if this merger goes through. on $43ger is based billion in senate jeez. it is a euphemism for job cuts. what will happen in these stores, absolutely job cuts. they are not going to be able to live. they will have twice the stores that at&t or verizon has. it will not happen. believe that it will happen. i have a nice bridge i would like to sell you in new york. it has been all day, bad assumptions, bad math. >> i will ask you to refrain from commenting. >> i would say t-mobile, every single employees shareholder, i give them stock every year.
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we have won every award as the top places to work in america. that is because of the way we treat our employees. our employees have the right to unionize if they choose. one of our stores has. the rest has significantly found the relationship -- yous you sit here, would like to commit as part of this transaction to not interfere with efforts by your employees to organize? >> we don't interfere. >> we don't get to today. our employees make the choice. that has always been an option. i have not had a chance. it is crazy to say that we will fire 30,000 people. sprint has 28,000 people. it is absolutely impossible. the gentleman to my left, protecting the american workers, you are contractually obligated to support at&t.
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they know what is going to come. ofon't pursue the comments bullying intimidation, that is what you said. employees come to work, they like working. the top employer in america. that is pretty much the fact. out 28,000e employees or 30,000 employees, that is irresponsible. these are employers who are watching right now who know that is not true. >> you want to respond? >> they keep using the word employees. they are going to -- there is no ,oubt, they can't be any doubt they will take these authorized dealers and they will slash and burn. those are american jobs that they will cut. they will cut 30,000 of those jobs. as far as sprint and t-mobile , at least t-mobile
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employees being able to join unions, they went as far and have been found guilty of forming a company union to stop the union from organizing people at t-mobile. that has not been done in this country since the 1930's. that is how much they are against their employees becoming unionize. >> i would ask unanimous consent that a number of letters in support and opposition be made as a part of this record. also a letter that i received from free conference call.com. i have heard this concern, a about whetherle, with t-mobile and
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about whetherty or not these pre-conference call programs will still be available . currently, they are considered out of plan with t-mobile and there is anxiety about whether that kind of service would be available. i don't know if you are in a position to answer that. with t-mobile and there is anxiety about whether that kind of service would be available. i don't know if you are in a position to answer that. >> i will follow up. >> thank you with t-mobile and there is anxiety about whether that kind of service would be available. i don't know if you are in a position to answer that. >> i will follow up. >> thank you all, this has been a long hearing. it has been incredibly informative. particularly helpful to members of the committee. with that, we will adjourn the hearing. thank you to the witnesses.
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announcer: tonight on afterwards. angela spent examines russia's foreign policy and international goals. in her book, russia against the west, she is interviewed by nevada democratic congresswoman who serves on the house foreign affairs committee. >> are you optimistic that if we and common ground, image arms control, we can be a good partner? >> putin popularity has fallen by about 40 points since he was reelected last year. public opinion data shows the majority of russians don't want civility, they want change. they want a better economic situation. many of those people understand that having this relationship to the west is not the way to go. announcer: watch afterwards tonight at 9:00 eastern on c-span two. announcer: democratic presidential candidate beto o'rourke of texas was in iowa to meet with voters. he took part in a st. patrick's day run and met with voters and
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reporters in waterloo. here is a look at some of his day. way to go. >> good job. >> you are doing great.

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