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CWA: Softbank/Sprint/Clearwire Review Must Include Build-Out Requirements, Address National Security Concerns

The Communications Workers of America urged the Federal Communications Commission to give close scrutiny to the Softbank/Sprint/Clearwire proposed deal, especially in terms of the concentration of spectrum and the lack of specific, verifiable planned build out by the merged company.

In a filing submitted today to the FCC, CWA pointed to the significant public interest risks of this transaction in two critical areas. Read the filing at www.cwa-union.org/sprint-transaction.

First, the FCC must put in place real buildout requirements as a condition of the deal. So far, we’ve only seen vague, unverifiable promises of network expansion. Sprint owns more than a third of licensed spectrum, yet operates virtually free of any construction requirements. In recent transactions and spectrum auctions, the FCC has imposed build-out requirements. The FCC should not make Sprint an exception to this precedent. The FCC should not approve the proposed transaction unless and until Sprint commits to concrete build-out requirements and provides a real plan, not vague promises.

“The FCC should stand up for the public interest and insist on build out and job creation as part of this deal. The FCC has denied other transactions and imposed build out standards to meet public interest standards. So far, we’ve seen nothing from Sprint and its partners that points to any U.S. job creation or consumer benefit from network investment. In reviewing this transaction, the FCC must follow past precedent and impose real conditions," said CWA President Larry Cohen.

Such a plan should be based on past Commission practices and the FCC should set specific requirements for Sprint in terms of build out and coverage, with three- and seven-year benchmarks for serving specific populations.

Second, the transaction raises serious national security concerns that also must be addressed. Sprint currently has majority ownership of Clearwire and is seeking FCC approval to buy the rest of Clearwire that it currently does not own. Clearwire buys network equipment from two Chinese equipment makers that are considered security risks by the House Intelligence Committee.

“The proposed Softbank/Sprint/Clearwire transactions would dramatically change the U.S. wireless market, putting control of a company that owns one-third of all U.S. licensed spectrum in the hands of a foreign company,” CWA said. Sprint is seeking an FCC waiver of its 25 percent foreign ownership rule.

Without firm and effective conditions to address these serious public interest concerns, as well as those raised by other parties, the FCC should deny the application.

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