Former vice presidential candidate and Sen. Joe Lieberman used to say that the best thing about his stint as Connecticut’s attorney general was that people called him “general.” Though we assume that he meant this largely in jest, the comment reflects a reality about the position of state attorney general. It can be a great launching pad for aspiring governors and senators, but the job typically doesn’t come with that much actual power. Many consumer protection matters are regulated at the federal level.
In an effort to change that, a number of left-leaning AGs in recent years have been banding together to form a kind of alternative voice on national matters. This has included everything from bringing an ill-conceived antitrust case against Microsoft in the 1990s to presciently sounding alarm bells early this century on aggressive subprime lending.
During the Trump years, attorneys general have yet to emerge as a force. But that could be changing. Ten Democratic AGs have joined a lawsuit against the proposed merger of Sprint and T-Mobile in what is shaping up as a possible split with the U.S. Justice Department. Justice is said to be leaning toward approval of the merger, with some conditions, as early as this week.
The bulk of the evidence suggests that the attorneys general are on the wrong side this time.
T-Mobile and Sprint are, respectively, the nation’s third and fourth largest providers of wireless telecommunications. Together, they would have a little more than a third of the national market, which would put them in the same range as the two industry leaders, Verizon and AT&T.
NEW YORK ATTORNEY GENERAL: Merger would raise prices and hurt consumers
Neither company has as extensive a network as the two leaders, so they have competed on cost, including aggressively going after the prepaid market, a service for people of modest incomes and sometimes dodgy credit.
For this reason the AGs and a host of consumer groups are loath to see the two companies link up. But wireless is a capital-intensive industry that requires massive outlays on both technology and spectrum to remain competitive. The industry is rolling out 5G networks, the biggest improvement since the origins of wireless internet.
Rather than running off large towers located miles apart, 5G runs off much smaller boxes placed just blocks apart. This will require a lot of equipment and a lot of installations. It will also require hefty doses of diplomacy, flexibility and perseverance in dealing with community resistance.
It is not clear that two plucky also-rans would be able to compete in the 5G era. However, a third provider equal in scope to AT&T and Verizon probably could.
An industry with three main players is not as competitive as one with four. But without this merger, this could end up as an industry of two for top-level services and two for cheaper but considerably inferior products.
Which makes this case look more like attorneys general angling for attention than actually protecting consumers from something harmful.
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