Remember back in April when T-Mobile announced that it was partnering up with Sprint to create one new network? According to a report from Reuters, the merger could be approved by the U.S. government as soon as next week.
However, as with most things, there is a catch. If T-Mobile wants the deal to go through, its parent company Deutsche Telekom needs to stop using any Huawei-made technology.
U.S. government officials have been pressuring T-Mobile's German majority owner, Deutsche Telekom AG, to stop using Huawei equipment, the sources said, over concerns that Huawei is effectively controlled by the Chinese state and its network equipment may contain "back doors" that could enable cyber espionage, something which Huawei denies.
T-Mobile and Sprint (or any U.S. carrier) already can't use any Huawei equipment, and this move looks to be a bargaining chip from the Committee on Foreign Investment to pressure T-Mobile's parent company to follow suit and do the same. Should Deutsche Telekom disagree, Reuters' source notes that the deal "could still fall through."
Huawei has refuted the security concerns, saying that they're "unfounded", but that doesn't seem to be stopping the U.S. from cutting Huawei's ties with as many of its partners as possible.
T-Mobile initially said that it anticipated the deal with Sprint to be completed by the first half of 2019, so this would certainly help keep that timeline on track. Once T-Mobile gets approval from the Comittee of Foreign Investment, it then needs to seek approval from both the Justice Department and the Federal Communications Commission.
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