The United States of America and the States of Kansas, Nebraska, Ohio, Oklahoma, and

South Dakota (“Plaintiff States”) bring this civil antitrust action to prevent the merger of T-

Mobile and Sprint, two of the four national facilities-based mobile wireless carriers in the United

States. The United States and Plaintiff States allege as follows:

from nearly any location in the country.

2. Competition has kept mobile wireless service prices down and served as a catalyst

for innovation. Preserving this competition is critical to ensuring that consumers will continue to

have reasonable and affordable access to an essential service that, for many, serves as a gateway

to the modern economy.

3. By combining two of the only four national mobile facilities-based wireless

carriers, without appropriate remedies, the merger of T-Mobile and Sprint would extinguish

substantial competition.

4. As the nation’s third and fourth largest mobile wireless carriers, T-Mobile and

Sprint have positioned themselves as challengers to Verizon and AT&T, their larger and more

expensive rivals, targeting retail customers who particularly value affordability. Some of these

Additionally, the merger likely would make it easier for the three remaining national facilities-

based mobile wireless carriers to coordinate their pricing, promotions, and service offerings. The

result would be increased prices and less attractive service offerings for American consumers,

who collectively would pay billions of dollars more each year for mobile wireless service.

6. Because the merger of T-Mobile and Sprint likely would substantially lessen

competition for retail mobile wireless service, the Court should permanently enjoin the proposed

transaction.

II. THE PARTIES AND THE PROPOSED MERGER

7. Deutsche Telekom AG (“Deutsche Telekom”) is a German corporation

headquartered in Bonn, Germany, and is the controlling shareholder of T-Mobile US, Inc. (“T-

operator in Europe, with net revenues of €75.7 billion (approximately $85 billion) in 2018.

8. T-Mobile is a Delaware corporation headquartered in Bellevue, Washington, and

million wireless subscribers, and approximately $43.3 billion in total revenues. T-Mobile sells

postpaid mobile wireless service under its T-Mobile brand, and prepaid mobile wireless service

primarily under its Metro by T-Mobile brand. T-Mobile also sells mobile wireless service

Overland Park, Kansas. It is the fourth largest mobile wireless carrier in the United States. At

the end of its 2018 fiscal year, Sprint had over 54 million wireless subscribers, and its fiscal year

2018 operating revenues were approximately $32.6 billion. Sprint sells postpaid mobile wireless

service under its Sprint brand, and prepaid mobile wireless service primarily under its Boost

Mobile and Virgin Mobile brands. Sprint also sells mobile wireless service indirectly through

MVNOs, which resell the service to consumers.

businesses in an all-stock transaction, pursuant to a Business Combination Agreement. The

merged firm would be owned 42% by Deutsche Telekom and 27% by SoftBank.

access the internet from a mobile device. Consumers access these services through a variety of

devices, including phones, tablets, and smart watches. Mobile wireless carriers compete for

retail customers by offering a variety of service plans and devices at a variety of prices.

a distribution network and marketing its services to retail customers. Facilities-based mobile

wireless carriers like T-Mobile and Sprint promote their prices, plan features, device offerings,

customer service, and network quality as they compete for retail customers. MVNOs typically

do not operate their own mobile wireless networks. Instead, these providers buy capacity

wholesale from facilities-based providers like T-Mobile and Sprint and then resell mobile

wireless service to consumers under their own brand name.

businesses who use mobile wireless service for voice communications, text messaging, and

internet access. These customers purchase mobile wireless service at retail stores or online, and

distinct from large business and government customers, who purchase mobile wireless service

through a bid process and receive different pricing than that available to the general public. A

a small but significant, non-transitory amount. Accordingly, retail mobile wireless service is a

relevant product market under Section 7 of the Clayton Act, 15 U.S.C. § 18.

16. The proposed merger would substantially lessen competition and harm consumers

in the relevant market. Post-merger, the combined share of T-Mobile and Sprint would account

for roughly one-third of the national retail mobile wireless service market, leaving only two other

national wireless carriers of roughly equal size (AT&T and Verizon).

17. American consumers, including those who are customers of Verizon and AT&T,

have benefitted from the competition T-Mobile and Sprint have brought to the mobile wireless

industry. For instance, it was not until after T-Mobile and Sprint introduced unlimited data plans

to retail customers in 2016 that Verizon and AT&T followed with their own standalone

unlimited data offerings to retail customers in 2017.

30% of retail subscribers who purchase prepaid mobile wireless service. These customers tend

to be even more value conscious, on average, than postpaid subscribers.

Boost Mobile brand has exerted significant downward pressure on prices. When Boost

introduced a family plan of four lines for $100 in February 2017, Metro countered with an

per month and then to $30 per month for entry level plans.

the quality of devices and the plan features available to prepaid subscribers. As one Sprint senior

executive observed in 2015, “The prepaid space is experiencing a severe price war. We now

have two competitors (Cricket and Metro) spending at postpaid-like advertising levels with

strong, best in class nation-wide networks. We need to find ways to differentiate our service

beyond device and rate plan price.” To “one up Metro” in May 2017, for example, Boost offered

unlimited calling to Mexico and unlimited voice roaming to customers traveling in Mexico. That

solid payment history to purchase a phone for $1 down and pay for it over 18 months with no

interest. And in February 2018, Boost offered an iPhone 6 for $49 to customers who switched to

Boost and kept their phone number.

elimination of Sprint, the industry’s low-price leader, New T-Mobile would have the incentive

and the ability to raise prices. In a post-merger world, the other remaining national facilities-

based mobile wireless carriers, Verizon and AT&T, also would have the incentive and the ability

this competition likely would reduce future innovation.

23. Given the high barriers to entry in the retail mobile wireless service market, entry

or expansion of other firms is unlikely to occur in a timely manner or on a scale sufficient to

replace the competitive influence now exerted on the market by Sprint.

24. Any efficiencies generated by this merger are unlikely to be sufficient to offset

the likely anticompetitive effects on American consumers in the retail mobile wireless service

market, particularly in the short term, unless additional relief is granted.

25. The United States brings this action, and the Court has subject matter jurisdiction

Defendants Deutsche Telekom, Softbank, T-Mobile, and Sprint (“Defendants”) from violating

Section 7 of the Clayton Act, as amended, 15 U.S.C. § 18.

26. The Plaintiff States bring this action under Section 16 of the Clayton Act, 15

U.S.C. § 26, to prevent and restrain the Defendants from violating Section 7 of the Clayton Act,

15 U.S.C. § 18. The Plaintiff States, by and through their respective Attorneys General, bring

this action as parens patriae on behalf of and to protect the health and welfare of their citizens

this District.

28. Venue is proper under Section 12 of the Clayton Act, 15 U.S.C. § 22, and 28

U.S.C. § 1391(b) and (c)(2), for Defendants T-Mobile and Sprint, and venue is proper for

Defendants Deutsche Telekom, a German corporation, and SoftBank, a Japanese corporation,

under 28 U.S.C. § 1391(c)(3).

29. The merger of T-Mobile and Sprint likely would lessen competition substantially

in interstate trade and commerce in the relevant geographic market for retail mobile wireless

service, in violation of Section 7 of the Clayton Act, 15 U.S.C. § 18.

30. Unless enjoined, the transaction likely would have the following effects in the