A federal judge has removed a major obstacle to T-Mobile's $26.5 billion takeover of Sprint, as he rejected claims by a group of states that the deal would mean less competition and higher phone bills.

After the deal closes, the number of major U.S. wireless companies would shrink from four to three.

T-Mobile says the deal would benefit consumers as it becomes a fiercer competitor to the larger Verizon and AT&T.

But a group of state attorneys general tried to block the deal, arguing that having one fewer phone company would mean higher cellphone bills.

The judge said the possibility was remote.

New York's attorney general says an appeal was possible.

The Justice Department only allowed the deal after T-Mobile agreed to sell millions of Sprint's prepaid customers to Dish, a satellite TV company with a shrinking customer base. T-Mobile also has to rent its network to the fledgling rival while it built its own. Dish is also required to build a faster, next-generation network, known as 5G, over the next several years.

The states had said that Dish wasn't certain to succeed as a wireless company and was far smaller than Sprint, and the resulting wireless market would still be worse for consumers.

(CBS News, AP contributed to this report.)

 

Â