10 DA 18-740 July 18, 2018 T-MOBILE US, INC., AND SPRINT CORPORATION SEEK FCC CONSENT TO THE TRANSFER OF CONTROL OF THE LICENSES, AUTHORIZATIONS, AND SPECTRUM LEASES HELD BY SPRINT CORPORATION AND ITS SUBSIDIARIES TO T-MOBILE US, INC., AND THE PRO FORMA TRANSFER OF CONTROL OF THE LICENSES, AUTHORIZATIONS, AND SPECTRUM LEASES HELD BY T-MOBILE US, INC., AND ITS SUBSIDIARIES WT Docket No. 18-197 PLEADING CYCLE ESTABLISHED Petitions To Deny Due: August 27, 2018 Oppositions Due: September 17, 2018 Replies Due: October 9, 2018 I. INTRODUCTION T-Mobile US, Inc. (T-Mobile), and Sprint Corporation (Sprint, together with T-Mobile, Applicants) have filed applications pursuant to Sections 214 and 310(d) of the Communications Act of 1934, as amended (the Act), 47 U.S.C. §§ 214, 310(d). seeking Commission consent to the transfer of control of the licenses, authorizations, and spectrum leases held by Sprint Corporation and its subsidiaries to T-Mobile US, Inc., and the pro forma transfer of control of the licenses, authorizations, and spectrum leases held by T-Mobile US, Inc., and it subsidiaries in furtherance of TMobile’s and Sprint’s previously announced agreement to merge. T-Mobile also filed a petition for declaratory ruling to permit foreign ownership in excess of the statutory benchmark in Section 310(b) of the Act. 47 U.S.C. § 310(b). Under their agreement, the proposed transaction contemplates a merger of Sprint into an indirect subsidiary of T-Mobile, with Sprint surviving as a direct subsidiary of T-Mobile USA, Inc., which is a direct subsidiary of T-Mobile. Post-transaction, Deutsche Telekom AG (Deutsche Telekom) would hold approximately 42 percent of the fully diluted shares of T-Mobile Common Stock, Softbank Group Corp. (Softbank) would hold approximately 27 percent of the fully diluted shares of T-Mobile Common Stock, and public shareholders would hold approximately 31 percent of the fully diluted shares of T-Mobile Common Stock. Deutsche Telekom would retain de facto control of the combined company (New TMobile) because it would have the right to designate a majority of the members of the Board of Directors and because its planned agreement with Softbank would grant it the right to direct the voting of Softbank’s New T-Mobile shares. Preliminary review of the Applicants’ submitted data (Appendix L: Spectrum Holdings and Aggregation Data) indicates that, in counties in which there is geographical overlap, New T-Mobile would hold a maximum of 361.7 megahertz of spectrum. II. SECTION 310(D) APPLICATIONS Parts 22, 24, 27, 30, 87, 90, and 101 – Wireless Radio Services The following applications for consent to the transfer of control of licenses held by subsidiaries of Sprint from Sprint to T-Mobile have been assigned the file numbers listed below: File No. Licensee Lead Call Sign 0008224209 This application is the lead application for the wireless radio services. Sprint Spectrum Realty Company, LLC KNLF200 0008235822 Alda Wireless Holdings, LLC WLW697 0008235840 American Telecasting Development, LLC B002 0008235852 American Telecasting of Anchorage, LLC WMX713 0008235851 American Telecasting of Columbus, LLC B095 0008235858 American Telecasting of Ft. Collins, LLC B149 0008235667 American Telecasting of Green Bay, LLC B018 0008235679 American Telecasting of Lansing, LLC B241 0008235685 American Telecasting of Lincoln, LLC B256 0008235694 American Telecasting of Medford, LLC B288 0008235698 American Telecasting of Michiana, LLC B126 0008235705 American Telecasting of Monterey, LLC B397 0008235708 American Telecasting of Redding, LLC B371 0008235713 American Telecasting of Seattle, LLC WHT657 0008235723 American Telecasting of Yuba City, LLC B485 0008235728 ATI Sub, LLC WNTK634 0008235734 Broadcast Cable, LLC WLW814 0008236000 Clearwire Hawaii Partners Spectrum, LLC B192 0008235280 Clearwire Spectrum Holdings II LLC B085 0008235060 Clearwire Spectrum Holdings III, LLC B020 0008236496 Clearwire Spectrum Holdings LLC B266 0008236687 Fixed Wireless Holdings, LLC B014 0008235294 Nextel West Corp. KBP878 0008234511 NSAC, LLC B004 0008236561 PCTV Gold II, LLC B011 0008236568 Sprint (Bay Area), LLC WHT700 0008236543 Sprint PR Spectrum LLC KNLH423 0008236514 Sprint Puerto Rico Holdings LLC WQYU424 0008236415 Sprint Spectrum License Holder LLC WLK242 0008235383 Sprint Spectrum, L.P. KNLF208 0008236216 SprintCom, Inc. B075 0008236163 TDI Acquisition Sub, LLC WMI303 0008236117 WBSY Licensing, LLC B228 0008235860 APC Realty and Equipment Company, LLC WPSH342 0008235866 Nextel Communications of the Mid-Atlantic, Inc. KNCM781 0008235873 Nextel of New York, Inc. KNDC447 0008235874 Nextel of Puerto Rico, Inc. WPRQ760 0008235879 Nextel South Corp. KED872 0008235886 NPCR, Inc. KNBF688 0008235888 People’s Choice TV of Albuquerque, LLC KFK32 0008235890 PRWireless PR, LLC WPNN780 0008235893 SCC X, LLC B157 0008235895 Sprint Administrative Services Group WPPD279 0008235898 Sprint Communications Company, LP 794SE 0008235903 Sprint Communications, Inc. WOJ40 0008235919 Sprint Spectrum License Holder II LLC KNLH500 0008235946 Sprint Spectrum License Holder III LLC WPVC984 0008235388 Sprint Telephony PCS, LLC WPON274 0008235949 Sprint United Management Company WQJW879 0008235951 WBSFP Licensing, LLC B152 The following applications for consent to the pro forma transfer of control of licenses held by subsidiaries of T-Mobile have been assigned the file numbers listed below: File No. Licensee Lead Call Sign 0008245816 T-Mobile Puerto Rico LLC KNLF249 0008243638 SunCom Wireless License Company, LLC KNKN557 0008243417 Powertel Memphis Licenses, Inc. KNLF255 0008253402 T-Mobile License LLC KNLF202 0008243390 Iowa Wireless Services Holding Corporation KNLG769 Parts 27, 30, and 90 – Wireless Radio Services Spectrum Leasing Arrangements The following applications for consent to the transfer of control of spectrum leasing arrangements pursuant to which subsidiaries of Sprint are the spectrum lessee from Sprint to T-Mobile have been assigned the file numbers listed below: File No. Lessee/Sublessee Lead Lease ID 0008234826 American Telecasting of Denver, LLC L000002648 0008235055 American Telecasting of Fort Myers, LLC L000002337 0008235066 American Telecasting of Little Rock, LLC L000000199 0008235084 American Telecasting of Louisville, LLC L000000262 0008235095 American Telecasting of Santa Barbara, LLC L000003594 0008235605 American Telecasting of Sheridan, LLC L000002493 0008235608 Fresno MMDS Associates, LLC L000000485 0008235643 Kennewick Licensing, LLC L000005239 0008235647 PCTV Sub, LLC L000003929 0008235661 People’s Choice TV of Houston, LLC L000001677 0008235682 People’s Choice TV of St. Louis, LLC L000002312 0008235699 SpeedChoice of Phoenix, LLC L000001990 0008235710 Transworld Telecom II, LLC L000003931 0008235724 WBS of America, LLC L000004063 0008235733 WBS of Sacramento, LLC L000000468 0008235765 WCOF, LLC L000004050 0008235774 Wireless Broadband Services of America, LLC L000001595 0008235800 SpeedChoice of Detroit, LLC L000001759 0008235828 Alda Wireless Holdings, LLC L000022687 0008235836 American Telecasting Development, LLC L000000259 0008235854 American Telecasting of Anchorage, LLC L000002488 0008235819 American Telecasting of Columbus, LLC L000001638 0008235831 American Telecasting of Ft. Collins, LLC L000002549 0008235675 American Telecasting of Green Bay, LLC L000002048 0008235683 American Telecasting of Lansing, LLC L000002690 0008235690 American Telecasting of Lincoln, LLC L000002703 0008235696 American Telecasting of Medford, LLC L000002516 0008235701 American Telecasting of Michiana, LLC L000001625 0008235706 American Telecasting of Monterey, LLC L000000225 0008235711 American Telecasting of Redding, LLC L000002487 0008235718 American Telecasting of Seattle, LLC L000003953 0008266885 American Telecasting of Seattle, LLC L000031135 0008235726 American Telecasting of Yuba City, LLC L000010348 0008235732 ATI Sub, LLC L000003928 0008235737 Broadcast Cable, LLC L000002011 0008236390 Clearwire Hawaii Partners Spectrum, LLC L000001566 0008235279 Clearwire Spectrum Holdings II LLC L000000886 0008235203 Clearwire Spectrum Holdings III, LLC L000005241 0008235205 Clearwire Spectrum Holdings III, LLC L000024327 0008236558 Clearwire Spectrum Holdings LLC L000000253 0008236594 Clearwire Spectrum Holdings LLC L000026615 0008266905 Clearwire Spectrum Holdings LLC L000000945 0008236715 Fixed Wireless Holdings, LLC L000000159 0008266899 Fixed Wireless Holdings, LLC L000001180 0008235293 Nextel West Corp. L000026606 0008234513 NSAC, LLC L000000168 0008236564 PCTV Gold II, LLC L000001637 0008236559 Sprint (Bay Area), LLC L000000341 0008236524 Sprint PR Spectrum LLC L000023619 0008236502 Sprint Puerto Rico Holdings LLC L000023616 0008236405 Sprint Spectrum License Holder LLC L000020418 0008235384 Sprint Spectrum, L.P. L000013987 0008236182 SprintCom, Inc. L000017748 0008236156 TDI Acquisition Sub, LLC L000003926 0008236108 WBSY Licensing, LLC L000003476 6042EDSL18 This application is a manual filing, and can be located as an attachment to the ULS licensing record for lease identifier L000003688. Clearwire Spectrum Holdings II LLC L000003688 6043EDSL18 This application is a manual filing, and can be located as an attachment to the ULS licensing record for lease identifier L000008676. Clearwire Spectrum Holdings III, LLC L000008676 6046EDSL18 This application is a manual filing, and can be located as an attachment to the ULS licensing record for lease identifier L000006063. NSAC, LLC L000006063 6045EDSL18 This application is a manual filing, and can be located as an attachment to the ULS licensing record for lease identifier L000001836. SpeedChoice of Detroit, LLC L000001836 6044EDSL18 This application is a manual filing, and can be located as an attachment to the ULS licensing record for lease identifier L000009842. Sprint PR Spectrum LLC L000009842 The following applications for consent to the pro forma transfer of control of spectrum leasing arrangements pursuant to which subsidiaries of T-Mobile are the lessee have been assigned the file numbers listed below: File No. Lessee/Sublessee Lead Lease ID 0008253328 T-Mobile License LLC L000017243 0008245179 Iowa Wireless Services Holding Corporation L000001109 0008253834 Iowa Wireless Services Holding Corporation L000020146 Part 25 – Earth Station Licenses The following applications for consent to the transfer of control of licenses held by subsidiaries of Sprint from Sprint to T-Mobile have been assigned the file numbers listed below: File No. Licensee Lead Call Sign SES-T/C-20180618-01523 Nextel Communications of the Mid-Atlantic, Inc. E040169 SES-T/C-20180618-01532 Sprint Communications Company, LP E6241 Part 78 – Cable Television Relay Service (CARS) The following applications for consent to the transfer of control of licenses held by subsidiaries of Sprint from Sprint to T-Mobile have been assigned the file numbers listed below: File No. Licensee Call Sign CAR-20180621AA-09 Fixed Wireless Holdings, LLC WLY-681 CAR-20180621AB-09 Fixed Wireless Holdings, LLC WLY-803 CAR-20180622AB-09 NSAC, LLC WLY-928 CAR-20180622AC-09 NSAC, LLC WLY-929 CAR-20180627AA-09 NSAC, LLC WLY-930 CAR-20180627AB-09 NSAC, LLC WLY-931 Part 5 – Experimental Radio Station Authorizations The following applications for consent to the pro forma transfer of control of licenses held by subsidiaries of T-Mobile have been assigned the file numbers listed below: File No. Licensee Lead Call Sign 0031-EX-TU-2018 T-Mobile License LLC WI2XHR 0032-EX-TU-2018 T-Mobile USA, Inc. WL9XWZ III. INTERNATIONAL SECTION 214 AUTHORIZATIONS The following applications for consent to the transfer of control of international Section 214 authorizations held by subsidiaries of Sprint from Sprint to T-Mobile have been assigned the file numbers listed below: File No. Authorization Holder Lead Authorization Number ITC-T/C-20180618-00118 Sprint Communications Co., LP ITC-214-19960117-00018 ITC-T/C-20180618-00119 SprintCom, Inc. ITC-214-19991110-00692 ITC-T/C-20180618-00120 Sprint Communications, Inc. ITC-214-19970723-00428 ITC-T/C-20180618-00121 Sprint Spectrum, L.P. ITC-214-1991203-00766 ITC-T/C-20180618-00122 PRWireless PR, LLC ITC-214-19990615-00426 ITC-T/C-20180618-00123 US Telecom, Inc. ITC-214-19851107-00004 ITC-T/C-20180618-00124 Virgin Mobile USA, L.P. ITC-MOD-20151207-00294 The following applications for consent to the pro forma transfer of control of international Section 214 authorizations held by subsidiaries of T-Mobile have been assigned the file numbers listed below: File No. Authorization Holder Lead Authorization Number ITC-T/C-20180618-00100 T-Mobile USA, Inc. ITC-214-19960930-00473 ITC-T/C-20180618-00101 T-Mobile Puerto Rico LLC ITC-214-20070626-00246 ITC-T/C-20180618-00102 Iowa Wireless Services LLC ITC-214-20020513-00251 IV. SUBMARINE CABLE LANDING LICENSES The following application for consent to the transfer of control of interests in international cable landing licenses held by the subsidiary of Sprint listed below from Sprint to T-Mobile has been assigned the file number listed below: File No. Interest Holder Lead Authorization Number SCL-T/C-20180618-00015 Sprint Communications Co., LP SCL-LIC-19920201-00010 V. DOMESTIC SECTION 214 AUTHORIZATION Sprint and T-Mobile filed a Joint Application for Consent to Transfer Control of International and Domestic Authority Pursuant to Section 214 of the Communications Act of 1934, as Amended, in WT Docket No. 18-197. The Joint Application requests Commission consent to the transfer of control of the domestic Section 214 authority held by subsidiaries of Sprint from Sprint to T-Mobile. Sprint, through its subsidiaries, offers competitive local and long distance wireline services in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. VI. PETITION FOR DECLARATORY RULING UNDER SECTION 310(B)(4) T-Mobile, on behalf of its current and future FCC licensee and lessee subsidiaries, has filed a petition for declaratory ruling (Petition), pursuant to Section 310(b)(4) of the Act and Section 1.5000(a)(1) of the Commission’s rules, 47 CFR § 1.5000(a)(1). that it would not serve the public interest to prohibit foreign ownership of T-Mobile in excess of the 25 percent benchmark in Section 310(b)(4). T-Mobile filed the Petition in connection with the proposed transfer of control to T-Mobile of common carrier wireless licenses and leases, and common carrier fixed satellite earth station licenses, held by subsidiaries of Sprint. As noted above, following consummation of the proposed transaction, 69 percent of T-Mobile’s equity and voting interests will be held by subsidiaries of Deutsche Telekom (42 percent) and SoftBank (27 percent), subject to a proxy that would be held by T-Mobile to direct the voting of SoftBank’s T-Mobile shares. TMobile states that the other 31 percent of T-Mobile shares will be held by public shareholders, none of which would hold five percent or more of T-Mobile’s stock. Pursuant to Section 1.5001(i) of the rules, T-Mobile requests that the Commission specifically approve foreign equity and voting interests that would be held directly or indirectly in T-Mobile post-closing by the following foreign-organized entities and foreign individuals: Deutsche Telekom Holding B.V. (DT Holding) (Netherlands); SoftBank Group Capital Limited (SoftBank Capital) (United Kingdom); T-Mobile Global Holding GmbH (T-Mobile Global Holding) (Germany); T-Mobile Global Zwischenholding GmbH (T-Mobile Global) (Germany); Deutsche Telekom AG (Deutsche Telekom) (Germany); Kreditanstalt fur Wiederaufbau (KfW) (Germany); Federal Republic of Germany (FRG) (Germany); SoftBank Group Corp. (SoftBank Group) (Japan); and Masayoshi Son (Japan) According to the Petition, the Commission has previously approved 100 percent foreign ownership of T-Mobile, including specifically by Deutsche Telekom and its above-identified foreign shareholders and subsidiaries. The Petition also states that the Commission has approved 100 percent foreign ownership of Sprint, including specifically by SoftBank Group and its above-identified foreign shareholders and subsidiaries. T-Mobile also states that no new foreign entities are being introduced as a result of the proposed transaction. T-Mobile also requests advance approval, pursuant to Section 1.5001(k) of the rules, for the following foreign-organized entities to increase their interests in T-Mobile at some future time up to any amount, including 100 percent of T-Mobile’s equity and voting interests: DT Holding; T-Mobile Global Holding; T-Mobile Global; and Deutsche Telekom. The Petition states that the Commission has previously granted this authority for all of these entities. T-Mobile additionally requests advance approval under Section 1.5001(k) for the following foreign-organized entities to increase their aggregate interest in T-Mobile at some future time, up to and including a non-controlling 49.99 percent equity and voting interest in T-Mobile: SoftBank Capital; SoftBank Group; Masayoshi Son; KfW; and FRG. The Petition states that these foreign-organized entities and foreign individual have previously been authorized to hold interests in T-Mobile or Sprint at the identified level of ownership (a non-controlling 49.99 percent equity and voting interest) or more. The Petition for Declaratory Ruling has been assigned File No. ISP-PDR-20180618-00002. VII. EX PARTE STATUS OF THIS PROCEEDING Pursuant to Section 1.1200(a) of the Commission’s rules, 47 CFR § 1.1200(a). the Commission may adopt modified or more stringent ex parte procedures in particular proceedings if the public interest so requires. We previously announced that this proceeding will be governed by permit-but-disclose ex parte procedures that are applicable to non-restricted proceedings under Section 1.1206 of the Commission’s rules. Id. § 1.1206; Commission Opens Docket for Proposed Transfer of Control of Sprint Corporation to TMobile US, Inc., WT Docket No. 18-197, Public Notice, DA 18-625 (rel. June 15, 2018). Parties making oral ex parte presentations are directed to the Commission’s ex parte rules. Parties are reminded that memoranda summarizing the presentation must contain the presentation’s substance and not merely list the subjects discussed. 47 CFR § 1.1206(b)(1). More than a one- or two-sentence description of the views and arguments presented is generally required. Id. Other rules pertaining to oral and written presentations are set forth in Section 1.1206(b) as well. Id. § 1.1206(b). VIII. REQUESTS FOR EX PARTE MEETINGS All requests for meetings with Commission staff regarding this docket should be made via email using T-MobileSprintTransaction@fcc.gov. Those who lack Internet or email access may direct their requests to Morasha Younger, Competition and Infrastructure Policy Division, Wireless Telecommunications Bureau, (202) 418-1203. IX. GENERAL INFORMATION The transfer of control applications listed above have been found, upon initial review, to be acceptable for filing. The Commission reserves the right to return any application if, upon further examination, it is determined to be defective and not in conformance with the Commission’s rules or policies. Interested parties must file petitions to deny no later than August 27, 2018. Persons and entities that file petitions to deny become parties to the proceeding. They may participate fully in the proceeding, including seeking access to any confidential information that may be filed under a protective order, seeking reconsideration of decisions, and filing appeals of a final decision to the courts. Commenters may also become parties to the proceeding for the purpose of seeking access to confidential information filed under a protective order. Oppositions to such pleadings must be filed no later than September 17, 2018. Replies to such pleadings must be filed no later than October 9, 2018. All filings concerning matters referenced in this Public Notice should refer to WT Docket No. 18-197. To allow the Commission to consider fully all substantive issues regarding the applications and the proposed transaction in as timely and efficient a manner as possible, petitioners and commenters should raise all issues in their initial filings. New issues may not be raised in responses or replies. Id. § 1.45(c). A party or interested person seeking to raise a new issue after the pleading cycle has closed must show good cause why it was not possible for it to have raised the issue previously. Submissions after the pleading cycle has closed that seek to raise new issues based on new facts or newly discovered facts should be filed within 15 days after such facts are discovered. Absent such a showing of good cause, any issues not timely raised may be disregarded by the Commission. Under the Commission’s current procedures for the submission of filings and other documents, FCC Announces Change in Filing Location for Paper Documents, Public Notice, 24 FCC Rcd 14312 (2009). submissions in this matter may be filed electronically through the Commission’s Electronic Comment Filing System (ECFS) or by hand delivery to the Commission. · To file electronically, Electronic Filing of Documents in Rulemaking Proceedings, Report and Order, 13 FCC Rcd 11322 (1998). access ECFS via the Internet at http://apps.fcc.gov/ecfs. In completing the transmittal screen, commenters should include their full name, U.S. Postal Service mailing address, and the applicable docket number. · To file by paper, the original and one copy of each filing must be filed by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. All hand-delivered or messenger-delivered paper filings for the Commission’s Secretary must be delivered to FCC Headquarters at 445 12th St., SW, Room TW-A325, Washington, DC 20554. The filing hours at this location are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes must be disposed of before entering the building. Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9050 Junction Drive, Annapolis Junction, MD 20701. U.S. Postal Service first-class, Express, and Priority mail should be addressed to 445 12th Street, SW, Washington, DC 20554. All filings must be addressed to the Commission’s Secretary, Office of the Secretary, Federal Communications Commission. One copy of each pleading, ex parte submission, or other filing must be delivered electronically, by email or facsimile, or if delivered as paper copy, by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (according to the procedures set forth above for paper filings), to: (1) Kathy Harris, Mobility Division, Wireless Telecommunications Bureau, at kathy.harris@fcc.gov or (202) 418-2643 (facsimile); (2) Linda Ray, Broadband Division, Wireless Telecommunications Bureau, at linda.ray@fcc.gov or (202) 418-7247 (facsimile); (3) Kate Matraves, Competition and Infrastructure Policy Division, Wireless Telecommunications Bureau, at catherine.matraves@fcc.gov or (202) 418-0787 (facsimile); (4) Jim Bird, Office of General Counsel, at TransactionTeam@fcc.gov or (202) 418-1234 (facsimile); and (5) David Krech, Telecommunications and Analysis Division, International Bureau, at david.krech@fcc.gov or (202) 418-2824 (facsimile). Any submission emailed to these individuals should include in the subject line of the email: (1) WT Docket No. 18-197; (2) the name of the submitting party; and (3) a brief description or title identifying the type of document being submitted (e.g., WT Docket No. 18-197, Widget Corp., Notice of Ex Parte Communications). The application and any associated documents are available for public inspection and copying during normal reference room hours at the following Commission office: FCC Reference Information Center, 445 12th Street, SW, Room CY-A257, Washington, DC 20554. The exhibits and declarations associated with the proposed transaction are available electronically through ECFS, which may be accessed on the Commission’s Internet website. The applications in addition are available electronically through ULS, which also may be accessed on the Commission’s Internet website. Additional information regarding the proposed transaction will be available on the FCC’s Office of General Counsel’s TMobile/Sprint website, https://www.fcc.gov/transaction/t-mobile-sprint, which will contain an unofficial listing and electronic copies of materials in this matter. To request materials in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice) or (202) 418-0432 (TTY). Contact the FCC to request reasonable accommodations for filing comments (accessible format documents, sign language interpreters, CART, etc.) by email: FCC504@fcc.gov; phone: (202) 418-0530; or TTY: (202) 418-0432. For further information, send an email to T-MobileSprintTransaction@fcc.gov. -FCC-