According to a report in The Wall Street Journal, T-Mobile US Inc. TMUS and Sirus XM Holdings Inc. SIRI are caught in a logjam with the latter accusing the former of causing interference to its operating airwaves. The skirmish between the telecom service provider and the satellite radio broadcaster has taken a serious turn with Sirus XM asking federal agencies to intervene.
The Blame Game
It all started when Sirus XM customers complained of frequent loss of signal in several big cities. Following an internal investigation, Sirius XM claimed that the interference was being caused by T-Mobile's celluar towers. T-Mobile, on the other hand, blamed Sirus XM for the issue, citing the inability of its towers to filter out the anomalies. Further, T-Mobile insisted that it is duly operating in accordance to the Federal Communications Commission (FCC) rules.
A closer look at the issue reveals that the problem is particularly prominent in areas where T-Mobile towers are present. As T-Mobile expands its new generation airwaves to compete against rivals like Verizon Communications Inc. VZ , AT&T Inc. T and Sprint, it may cause further operational hindrances for Sirus XM.
Although both the companies have taken cognizance of the matter, they are divided on the solution front. While Sirus XM wants T-Mobile to share the cost for a fix, the latter is adamant and not keen about shouldering any financial responsibility for the issue. Nevertheless, both the companies are ready to cooperate in order to resolve the problem.
A senior FCC official stated that the concerned airwaves have been in use for years. Given the complexities involved, the FCC is unlikely to jump to any conclusions and will investigate the issue in detail, going forward.
Both Sirus XM and T-Mobile currently carry a Zacks Rank #3 (Hold).