T-Mobile US Inc (TMUS) CEO John Legere Reacts To FCC Chairman Tom Wheeler’s Status Quo

T-Mobile US Inc (NYSE:TMUS) CEO, John Legere, expressed his unhappiness over FCC Chairman, Tom Wheeler’s, recent statement. His displeasure is obvious since the company is badly in need of spectrum in its efforts to compete. His effort to merge with DISH Network Corp (NASDAQ:DISH), which has tons of spectrum, is also facing road blocks to reach the logical ends. The FCC chairman called for the status quo on the issue and rejected any calls for a revision.

Big Two Enjoying

T-Mobile US Inc (NYSE:TMUS) CEO said that as a result of the FCC ruling, AT&T Inc. (NYSE:T) and Verizon Communications Inc. (NYSE:VZ) are the beneficiaries. That is because the low-band air wave is the sacred grail for both. He pointed out that the customers of both the telecom carriers will gain more than $20 billion in a year collectively if others are also provided the same.

Legere’s charge is that if others are provided with spectrum, prices will come down and options for consumers will increase. That will also provide a level playing field for it and the two big carriers to compete on the pricing. It was because of this reason that most of the people want FCC to relax its tough stance. T-Mobile US Inc (NYSE:TMUS) CEO wanted the FCC chairman to heed to the calls of many Congress members, consumer groups, and the Department of Justice. His argument is that the relaxation will strengthen the reserve.

Current Size

In his blog post, FCC Chairman pointed out the current reserve size of 30 megahertz. He opined that it balances the need to provide low-band spectrum available to firms with restricted holdings and at the same time facilitate competitive bidding for all participants in the auction. Therefore, he believes that there was no need to expand the reserve in the upcoming auction.

T-Mobile US Inc (NYSE:TMUS), DISH Network Corp (NASDAQ:DISH), and Sprint Corp. (NYSE:S) wanted the FCC to increase the reserve to 40 MHZ since the big two could easily outbid them. There was also tremendous amount lobbying from the small carriers.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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