FCC approves AT&T's purchase of Leap Wireless

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The U.S. Federal Communications Commission has approved AT&T’s US$1.2 billion acquisition of competitor Leap Wireless, which sells prepaid mobile service under the Cricket brand.

The FCC on Thursday cleared the transaction subject to several conditions. Among other things, AT&T agreed to sell off some wireless spectrum, deploy LTE service on Leap’s unused spectrum and deploy LTE in six south Texas markets within 18 months.

AT&T announced plans to acquire Leap in July. Mobile analysts expected Leap as the next carrier to be sold after SoftBank in 2013 bought No. 3 carrier Sprint for $21.6 billion, a deal allowing Sprint to acquire Clearwire. In early 2013, No. 4 T-Mobile US acquired MetroPCS, another regional budget carrier.

Leap’s Cricket service has about 4.6 million customers.

Public Knowledge, a digital rights group, questioned the deal, saying the FCC needs to address problems with spectrum holdings being consolidated by a handful of mobile carriers.

“The removal of Leap ... from the marketplace is troubling, because its low-cost, prepaid price plans are particularly attractive to low-income consumers,” John Bergmayer, senior staff attorney at Public Knowledge, said in a statement. “While, among other things, AT&T has committed to offering a $40, unlimited plan for feature phones for 18 months, the best guarantee of consumer protection is competition, not promises.”

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