Cogent Buys T-Mobile Wireline, $81 Million from Emergency Connectivity Fund, Digital Redlining Study

T-Mobile is focusing on its wireless business, while Cogent wants to eventually replace its leased network.

Cogent Buys T-Mobile Wireline, $81 Million from Emergency Connectivity Fund, Digital Redlining Study
Photo of George Ford of the Phoenix Center

September 8, 2022 – Internet service provider Cogent Communications announced Wednesday that it will acquire T-Mobile’s wireline business.

Cogent said in a press release that it is viewing T-Mobile’s legacy Sprint wireline network as a “complementary” asset that will eventually replace its current leased network. Meanwhile, T-Mobile is focusing on its wireless business, including its 5G network expansion.

T-Mobile closed its acquisition of Sprint in 2020, which also resulted in the sale of some wireless assets to Dish Network.

The transaction, which is subject to regulatory approval, is expected close in the second half of 2023.

Another $81 million from the Emergency Connectivity Fund

In a press release Tuesday, the Federal Communications Commission announced an additional $81 million in funding for the third application window of the Emergency Connectivity Fund, which goes to help students stay connected outside of school.

This round of funding is anticipated to support over 170,000 students across the country, according to the release.

The $7.1-billion program has so far committed over $5.8 billion in funding, dedicated to support schools and libraries in need of connected devices and off-campus learning options. The program so far has provided support to approximately 10,000 schools, 900 libraries, and 100 consortia, and provides nearly 12 million connected devices and over seven million broadband connections, as stated in the release.

According to the press release, of the nearly $5.8 billion in funding commitments approved to date, approximately $4.1 billion is supporting applications from the first application window; $800 million from the second window; and $893 million from the third window.

No evidence of digital redlining, says think tank

The Phoenix Center for Advanced Legal and Economic Public Policy Studies allege no evidence of digital redlining in a recent analysis, it announced in a release on Wednesday.

“Our analysis aims to separate economic factors—demand and costs—from race and income as determinants of fiber availability and broadband speeds, since discrimination requires differential treatment for equally profitable consumers,” said the center’s chief economist George Ford.

Phoenix Center Senior Fellow Randolph Beard conducted an empirical analysis of cases regarding digital discrimination in fiber deployment and tested broadband speeds, which the center said resulted in these findings.

The study challenges the economics behind the Infrastructure, Investment and Jobs Act provision to resolve digital redlining by questioning the implied racial and class-based bias in digital discrimination, it said.

“Discrimination is costly to the firm (i.e., forgone profits), so these results indicating a lack of digital discrimination are consistent with profit-maximizing behavior by providers.” Ford said.

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