Stop T-Mobile’s FCC Approval: CWA Petitions Against UScellular Acquisition

T-Mobile’s Sprint-Fueled Ambitions: A New Acquisition and Labor Concerns

In April 2020, T-Mobile gobbled up Sprint in a $26 billion deal, and appetite wasn’t satiated. By May, the carrier closed a $1.35 billion cash and stock acquisition of Mint Mobile and Ultra Mobile. Despite digesting these deals, T-Mobile remained hungry for more. In May, it went after UScellular, the fifth-largest wireless provider, for $4.4 billion. This deal, though, faces an uncertain future, thanks to the Communications Workers of America (CWA).

CWA Fights to Deny T-Mobile’s UScellular Acquisition

In a recent press release, the CWA announced that it has filed a Petition to Deny with the Federal Communications Commission (FCC). The union urges the FCC to reject T-Mobile’s proposed acquisition of UScellular as it stands. The CWA wants the FCC to request binding, enforceable measures to protect employees and consumers who work and shop at wireless retail stores.

The CWA’s Concerns: Reduced Competition and Higher Prices

The CWA, which represents a significant number of telecom employees, including those working in wireless retail stores, is worried about reduced competition and higher prices for consumers. The acquisition, if approved, would result in UScellular ceasing to be an option for consumers seeking wireless services, and rural carriers that buy wireless services from UScellular to resell to consumers would be affected.

The Acquisition’s Impact on Competition

The CWA claims that T-Mobile and UScellular have yet to demonstrate how the transaction would improve competition in multiple markets, particularly since T-Mobile already has significant market power over industry workers. The union argues that a T-Mobile acquisition of UScellular would lead to fewer options for consumers, resulting in higher prices and reduced competition.

CWA’s Demands: Pro-worker and Pro-consumer Conditions

The CWA demands that the FCC take the following steps before approving the transaction:

1. Ensure that the transaction does not lead to a reduction in U.S. employment and no employee of T-Mobile or UScellular loses a job due to this transaction.
2. Complete neutrality in allowing employees to form a union of their choosing, free from any interference by the employer.
3. No degradation of pay/benefits for five years post-merger.
4. Additional measures to protect competition in labor markets.
5. Extend other rural carriers’ roaming agreements with UScellular under the same terms.

T-Mobile’s Track Record: A Cautionary Tale

The CWA cites T-Mobile’s previous purchase of Sprint as an example of what could happen if the FCC approves T-Mobile’s purchase of UScellular. The acquisition of Sprint led to a heightened ability for the combined company to cut or freeze wages, lower wage growth, reduce benefits, and worsen working conditions. Since neither T-Mobile nor UScellular is unionized, workers will have no negotiating power, according to the CWA, making it a bad deal for workers.

Conclusion

The CWA’s petition to deny the T-Mobile-Usccell acquisition is a direct response to the potential negative impacts on workers and consumers. As the FCC deliberates, the CWA hopes that the commission will prioritize the interests of all stakeholders, ensuring a fair and competitive wireless market that benefits everyone involved.