NEW YORK (Reuters) – Executives from Sprint Corp testified on Monday that the U.S. wireless carrier has struggled to improve its network, hindering its growth and underscoring the need to merge with larger rival T-Mobile US Inc.

U.S. state attorneys general, led by New York and California, are suing to stop the merger.

The states seek to prove in Manhattan federal court that the deal between the No. 3 and No. 4 wireless carriers would raise prices, particularly for users on prepaid plans. The state attorneys general, all Democrats, asked Judge Victor Marrero to order the companies to abandon the deal.

Sprint Chief Marketing Officer Roger Solé testified that the company’s strategy for enticing customers from competitors included slashing prices.

But he said the promotion’s “early success faded away pretty soon” due to customers having a negative experience with Sprint’s network quality.

In an effort to show how competition lowered prices, the states presented evidence that when Sprint introduced an aggressive promotion in 2016 to offer phone plans comparable to those of Verizon, AT&T and T-Mobile, T-Mobile’s MetroPCS prepaid brand immediately lowered prices on its plans.

The evidence is central to the states’ argument that Sprint and T-Mobile as standalone companies force competition between carriers, providing the best deal for consumers.

Solé

Lawyers for the states also presented evidence suggesting Sprint wanted a deal so more money could be earned from each customer.

In WhatsApp messages from 2017 between Solé and Marcelo Claure, who was then CEO of Sprint, Solé suggested a merger with T-Mobile could raise Sprint’s average revenue per user by $5.

In his deposition before the trial, Solé said he was simply offering a thought that price increases could happen “very far down the road.”

The companies argue that the stronger T-Mobile that would result from the proposed $26.5 billion takeover would be better able to innovate and compete to reduce wireless prices. The case represents a break with the usual process of states coordinating with the federal government in reviewing mergers and generally coming to a joint conclusion.

The deal had been contemplated in 2014 during the Obama administration, but the Justice Department and Federal Communications Commission urged the companies to drop it, which they did.

The Trump administration signed off on it after the companies agreed to sell Sprint’s prepaid businesses, popular with people with poor credit, to satellite television company Dish Network Corp.

But setting up DISH as a wireless carrier is “patently insufficient to mitigate the merger’s competitive harm,” the states argued in a court filing.

Deutsche Telekom CEO Timotheus Höttges, whose company is the largest shareholder of T-Mobile, will testify on Tuesday.

Reporting by Diane Bartz and Sheila Dang; Additional reporting by Brendan Pierson; Editing by Daniel Wallis, Nick Zieminski and Dan Grebler

The satellite and app-based radio service SiriusXM has announced a broad-based rate increase for its customers that will take effect Nov. 13, 2019. Most customers will see a rate hike of $1 per month.

The company made the announcement with little fanfare, announcing the rate changes in private e-mails sent to customers.

Sirius and XM Radio used to be separate, competing satellite radio services. But in the waning days of the George W. Bush Administration, regulators approved a merger between the two entities after a 57-week review process, establishing a satellite radio monopoly.

The Bush Justice Department approved the Sirius and XM Radio merger on March 24, 2008, after being persuaded that satellite radio faced significant competition from traditional AM and FM radio, online streaming services, and the growing use of MP3 players. The FCC under Chairman Kevin Martin followed with a 3-2 approval on a party-line vote favoring the Republican commissioners. Martin said the internet delivered all the competition a combined SiriusXM could handle.

“The merger is in the public interest and will provide consumers with greater flexibility and choices,” Martin said of the merger at the time.

Martin’s predictions turned out to be largely untrue, as the combined company quickly merged into a single satellite radio service, began a series of rate increases, and faced the wrath of state attorneys general for its poor customer service and difficulty processing subscriber cancellations. For years as competing providers, Sirius and XM charged $12.99 a month, with substantial discounts for customers agreeing to multiple-month subscriptions. Lifetime subscriptions were also available. As of November 11th, the most popular subscription options — XM Select will cost $16.99/mo and XM All Access will cost $21.99/mo.

SiriusXM also now charges a range of fees customers may face:

• Activation Fee: For each radio on your account, SiriusXM may charge a fee to activate, reactivate, upgrade or modify your subscription package.
• U.S. Music Royalty Fee: Package pricing does not include the U.S. Music Royalty Fee, now 21.4% of the price of most audio packages which include music channels.
• Invoice Administration Fee: If you request to receive a paper invoice, SiriusXM will charge you an invoice administration fee on each paper invoice rendered, except where prohibited.
• Late Fee: If payment is not received in a timely manner, a late fee may apply.
• Returned Payment Fee: If any financial institution or credit card refuses to honor your payment, a fee may be charged.
• A La Carte Channel Change Fee: If you have an “A La Carte” Package, for each subsequent transaction to change your initial channel selections, you may be charged a fee.
• Transfer Fee: If you transfer a Subscription from one radio to another you may be charged a transfer fee.
• Cancellation Fee: Cancellation fees may be applied to Subscriptions activated in combination with a device purchased directly from SiriusXM.

SiriusXM customers can always get a much lower rate by threatening to cancel service. To cancel, call 1-866-635-2349 Monday through Friday 8:00 AM through 10:00 PM, ET, Saturday and Sunday 8:00 AM through 8:00 PM, ET. Tell the representative you are canceling because the service costs too much. You should be offered a retention rate of $30-35 for the next 5-6 months of service or around $60-100 a year (the lower end for Select, the higher end for All-Access). Just set a calendar reminder to repeat the cancellation threat a week or two before your retention rate is scheduled to expire and you can usually get that offer renewed. Note that the Music Royalty Fee will continue to be charged separately. A credit card is often required to get retention pricing, and service will automatically rebill at the prevailing rate after the promotional rate expires.

November 13, 2019 SiriusXM Subscription Rate Change

When will the subscription rates change? 

For packages that are impacted by the rate adjustment, the new subscription rates will be effective November 13, 2019. The new rates will apply to subscription purchases made on and after that date, or renewals of existing subscriptions that are processed on and after that date.

Which packages will be impacted by the rate change on November 13, 2019?

The standard monthly rates for Select, Select Family Friendly, All Access, All Access Family Friendly, Premier, Premier Family Friendly packages will increase. The standard monthly rates for A La Carte, A La Carte + Howard, A La Carte + Sports, A La Carte + Howard + Sports, and A La Carte Gold packages will increase.

The standard monthly rates for additional radios that are eligible for the Family Discount for these same packages will also increase.

By how much will the rates change?

The standard monthly rates for Select, Select Family Friendly, All Access, All Access Family Friendly, Premier, Premier Family Friendly packages, and A La Carte packages for a primary radio will increase by $1 per month. The standard rates for additional radios that are eligible for the Family Discount will also increase by $1 per month.

Which packages or plans are not impacted by the November 13, 2019 rate change?

The standard rate adjustment does not apply to the following packages: SiriusXM Premier Streaming, SiriusXM Essential Streaming, Mostly Music, News, Sports & Talk, Basic, Basic Plus, Español, Español Plus, MiRGE All-in-One, Traffic, and Travel Link, as well as Aviation weather packages.

My current subscription plan does not renew until November 13, 2019 or later. When will I be billed at the new rates?

You will be billed the new rate the next time your plan renews on and after November 13, 2019.

I have a plan for the Lifetime of my radio. Does the rate adjustment on November 13, 2019 impact the Lifetime plan?

No. Lifetime plans are not impacted by the rate adjustment.

Will the rate adjustment affect my trial subscription?

No. Trial subscriptions are not impacted by the rate adjustment.

I’m still on a trial subscription but I’ve already ordered a new subscription that will start when my trial subscription ends. Will you charge me the new rate?

If you have already purchased a Select, Select Family Friendly, All Access, All Access Family Friendly, Premier, Premier Family Friendly, or A La Carte package in a plan that will start when your trial ends (or if you purchase it before November 13, 2019), you will be charged the current rates for your first billing period, even if your trial does not end until after November 13, 2019. Then, whenever your plan bills again, you will be charged the new rates (or the rates in effect at that time) for those packages.

Examples:

If you chose a monthly billing plan to follow your trial, the first month will not be impacted by the adjustment. The new rates will apply to the second and subsequent months of your plan.
If you chose a quarterly billing plan to follow your trial, the first three months of your service will be at the current rates. You will not be billed at the new rate until your plan bills again (after the first three months).

Will the subscription rates for my ‘infotainment’ services from SiriusXM, such as traffic, Travel Link, Aviation, or Marine weather change on November 13, 2019?

The rates for traffic, Travel Link, and Aviation services will not change on November 13, 2019. The rates for Marine packages will change on November 13, 2019.

If I subscribe to one of the packages impacted by the rate adjustment, will you notify me before my subscription rate changes?

Yes, if we have valid contact information on your account, we sent or will send a notification to you by mail or email, before your plan bills or renews. This might be a good time to visit the Online Account Center to make sure your contact information is correct. If you have never before visited your online account, you will need to go through a short registration process before you can access your account.

When will the subscription rates for Marine weather change?

The new subscription rates will be effective November 13, 2019 for packages impacted by the rate adjustment. The new rates will apply to subscription purchases made on and after that date, or renewals of existing subscriptions that are processed on and after that date.

Which Marine weather packages will be impacted by the rate change on November 13, 2019?

The standard monthly subscription rates for all SiriusXM (Inland, Coastal, and Offshore), XM (Skywatch, Fisherman, Sailor, Master Mariner) and Sirius (Inland, Mariner, Charter) will increase.

How much will the rates change?

Effective November 13, 2019:

• The standard rate for SiriusXM Marine Inland and Sirius Inland subscription packages will increase by $2 per month.
• The standard rate for SiriusXM Marine Coastal and Offshore, XM Skywatch, Fisherman, and Sailor, and Sirius Marine and Charter subscription packages will increase by $5 per month.
• The standard rate for XM Marine Master Mariner subscription packages will increase by $10 per month.
• The standard rate for Sirius Marine Voyager subscription with Select, All Access, and Premier packages will increase by $1 per month.

My current Marine weather subscription plan does not renew until November 13, 2019 or later. When will I be billed at the new rates?

You will be billed the new rate the next time your plan renews on and after November 13, 2019.

Many of the same civil rights groups that regularly advocate their support of giant corporate telecom mergers are back once again to show their support for the controversial T-Mobile/Sprint merger. But that support does not come for free.

A “Memorandum of Understanding” (MOU) that includes “philanthropy and community investment” that does not exclude direct financial contributions from the two wireless companies to these civil rights groups is a major part of a new “understanding” announced today between several organizations founded to represent minority interests and T-Mobile and Sprint that the wireless companies hope will deliver an imprimatur for the troubled merger deal with regulators and politicians.

The key items in the MOU:

1. Standing up a national diversity and inclusion council comprised of non-employees from diverse groups, including each of the multicultural leadership organizations that are party to the MOU, and other highly esteemed community leaders to facilitate open communication over the development, monitoring, and evaluation of diversity initiatives and to provide advice to the New T-Mobile senior executives.

2. With the help and input of the council, developing and implementing a Diversity Strategic Plan addressing each of the key elements of the MOU and reflecting best practices in the industry.

3. Increasing the diversity of its leadership and workforce at all levels including its Board governance, to reflect the diversity of the communities in which it operates.

4. Making a targeted effort to increase partnerships, business, and procurement activities with diverse business enterprises in a range of categories such as financial and banking services, advertising, legal services and asset sales. New T-Mobile aims to become a member of the Billion Dollar Roundtable by 2025.

5. Expanding wireless offerings to low-income citizens, underserved minority populations and insular and rural areas, and to organizations serving these underserved communities [including] a significant philanthropic investment for institutions serving disadvantaged or underrepresented communities to support tech entrepreneurship and to bridge the gap in literacy.

The groups, most familiar to Stop the Cap! readers that have followed civil rights groups engaged in pay for play advocacy, include:

• National Urban League: A notorious friend of big cable and phone companies, the Urban League is a regular supporter of telecom mergers and opposes net neutrality.
• The League of United Latin American Citizens (LULAC): Brazenly photographs its executive leadership accepting big checks from AT&T and other telecom companies.
• National Action Network: Rev. Al Sharpton’s group loves to support telecom mergers and acquisitions and lobbies to block consumer protection regulation.
• UnidosUS: Receives most of its funding from corporate interests.
• Asian Americans Advancing Justice | AAJC
• OCA – Asian Pacific American Advocates: One of Comcast’s special friends, OCA advocated against new consumer privacy rules two years ago claiming poor people want more intrusive ads.

In a joint statement, the groups urged the FCC to approve the T-Mobile/Sprint merger “so the combined New T-Mobile can definitively launch these enhanced diversity efforts and expansion of service to all communities included in the MOU.”

“T-Mobile is honored to partner with these visionary organizations to create an action plan of this magnitude that includes commitments to diversity and inclusion that are bolder than ever before,” John Legere, CEO of T-Mobile and CEO of New T-Mobile, said in a statement. “With this MOU, we have doubled down on ensuring we represent the communities we serve today and will serve as the New T-Mobile in the future. We are excited for the New T-Mobile to become a reality so we can get to work on delivering these commitments.”

Except in most cases, these kinds of arrangements serve mostly as window dressing, gussying up otherwise nakedly anti-consumer merger deals under the guise of serving minority or disadvantaged interests. Money often quietly flows between the corporate and the non-profit side, usually in the form of donations. Some groups may also offer token advisory board positions to executives, which usually cements an ongoing advocacy relationship.

Members of these civil rights organizations have a right to be puzzled why such groups are spending significant time and resources engaged in corporate advocacy. The interests of two major corporations cementing a multi-billion dollar merger deal and civil rights groups trying to fight discrimination and improve the lives of their constituents are often tangential, if not in direct opposition to each other. Apparently the money that usually comes with these arrangements matters much more.

Time Warner Cable used to sell $14.99/mo slow speed internet. Spectrum agreed to grandfather the program for existing enrolled customers.

Charter Spectrum is raising both the speed and price of its legacy Everyday Low Price Internet package (ELP), formerly sold by Time Warner Cable.

Customers grandfathered on an existing Time Warner Cable ELP plan will see the following changes, reported by several of our readers, likely already in effect in some areas:

• NY/NJ Customers: Speeds increased from 3/1 Mbps to 20/2 Mbps. Price increasing from $14.99/mo to $19.99/mo.
• Other States: Speed increase to 20/2 Mbps. Customers will be notified of a $3 rate hike, bringing the new price to $27.99/mo.

A modem rental fee may also apply in most states, unless you use your own cable modem. Outside of New York and New Jersey, most legacy ELP customers have already experienced several gradual rate increases on this plan, which was originally sold nationwide for $14.99/mo. The first rate increase took most customers to $19.99/mo, followed by a rate increase last fall to $24.99/mo. Now Charter Spectrum has notified customers of another $3/mo rate hike, bringing the monthly rate to $27.99.

Stop the Cap! fought for and won a special concession for New York State residents as a consequence of the approval of the Time Warner Cable-Charter Communications merger. We requested the New York State Public Service Commission make the continued availability of price fixed ELP service a condition of the 2016 merger approval. The PSC agreed with us and made continued availability of the $14.99 service for at least three years part of the deal. That deal condition recently expired and Charter Spectrum is ready to raise the price of the service in New York and New Jersey, but also dramatically boost its download speed. New York and New Jersey residents will continue getting a substantial discount off the price Charter Spectrum charges elsewhere, at least for now.

CBS and Viacom are one important step closer to merging under the CBS name, creating one of the country’s largest programming and broadcasting powerhouses.

Last week, the two companies’ board of directors agreed on who would run the combined company that will be worth tens of billions of dollars.

Under the agreement, the top spot will go to current Viacom CEO Bob Bakish, according to a report in the Los Angeles Times. Bakish has been working with Viacom to transform its operations in a world increasingly dominated by cord-cutting and online streaming. Viacom had a reputation of being ruthless with its cable and satellite partners, demanding some of the industry’s highest rates for Viacom-owned cable channels, causing some cable operators to drop Viacom networks from their cable TV lineups.

It will not be the first time CBS and Viacom have been merged. Owner Sumner Redstone kept the two companies together until splitting them apart in 2006. Shortly after, Redstone’s declining health led to warring factions inside the two companies and several legal disputes with Sumner’s daughter Shari, who took over for her 96-year-old father. Former CBS CEO Les Moonves long opposed a merger between CBS and Viacom, but Moonves was forced out of CBS because of a burgeoning sexual harassment scandal. His replacement, acting CBS CEO Joseph Ianniello, is said to be sanguine about the merger deal, even though it would result in a demotion to managing CBS’ broadcast network, owned and operated TV stations, and Showtime.

The merged company would absorb Viacom into CBS, putting assets including Comedy Central, MTV, VH-1, Nickelodeon, BET, and Paramount Pictures under CBS ownership and control.

Three people close to the situation cautioned talks were still ongoing and not final.

Fox Business News reports the merger of CBS and Viacom may be imminent. Will they also acquire Discovery Networks? (4:53)