During a Q&A session on Monday, at UBS’s 44th Annual Global and Media Communications Conference, the CFO of T-Mobile, Braxton Carter, said telecom regulation under Trump would be “more positive for the industry.”
The executive’s comments come at a conflicted time for U.S. politics and business. T-Mobile has previously halted from merging or acquiring other companies due to rulings by Obama’s FCC.
The industry expects the President-Elect’s appointees to lead the telecommunications sector will loosen up on net neutrality regulation that prevents them from profiting even more.
Tom Wheeler, the FCC’s current Chairman, has directed in the past few years a huge campaign for more progressive governance of the industry, including guidelines that favor consumers over big companies such as T-Mobile.
What does T-Mobile mean with “more innovative”?
Although he was not specific as to what kind of innovation a Trump presidency could bring to the industry, T-Mobile’s CFO said the President-Elect would surely bring new growth and opportunities for diversification.
“I think it’s very clear there is going to be less regulation, and regulation often destroys innovation and value creation in bringing benefits to the consumer. And the trick is bringing a benefit to the consumer while you’re also benefiting your shareholders,” Carter said.
The T-Mobile financial chief added he expected a more open environment for consolidation of telecom companies under the new Washington administration.
Carter’s remarks may or may not point at an impending merger waiting to happen for years. CEO John Legere has said in the past tech giants like Facebook and Google have their eyes on the telecom business.
T-Mobile itself has tried to get bigger in the past, being on the verge of merging with its top competitor, the carrier giant AT&T. AT&T is also in talks with Time Warner to acquire its core TV business for over $85 billion.
The deal does not stand a chance to pass under Tom Wheeler’s FCC, but a new head of the regulatory body appointed by Trump may give the all-clear to the merger in 2017.
Trump’s tenure could bring back old standards
The President-Elect named Mark Jamison and Jeff Eisenach as transition leaders of the Federal Communications Commission a couple of weeks ago.
The two officials have previous ties to some of the biggest names in the mobile carrier industry, including T-Mobile competitors Verizon and Sprint.
A new FCC with the sector’s best interests in mind will likely not only push for less regulation but also overturn governing net neutrality policies that restrict companies from conducting business as they please.
What was wrong with old regulations?
Repealing Title II, which holds ISPs equal to mobile carries in the eyes of the law, could bring forward old business practices like data caps, throttling, and deceitful service offers back to the menu of many providers.
A more “liberal” regulatory body could also result in the complete monopolization of the industry, with giants like AT&T and Comcast making moves to seize the throne in all fronts: cable, the Internet, and mobile.