T-Mobile and Sprint Merger Now Seems More Likely Than Ever

[dgstorm]

Despite worries that U.S. regulators will "poo poo" the merger, the deal for Sprint to buy T-Mobile now looks a great deal closer to reality than ever before. Apparently, Deutsche Telekom has been in direct talks to sell their 67% stake in T-Mobile to Softbank (Sprint's majority owner). This is an almost sneaky way for this deal to push through as there are far fewer regulatory hurdles to jump through to make it happen. It will be much tougher for any U.S. governmental agency to stop the sale of a majority ownership from one non-American company to another non-American company.

To be clear, just because this is a back door way to push this deal through, does not mean there aren't ways for the FCC and/or the Department of Justice to stymy the deal. Things simply get a great deal more complicated than before. Regardless, it seems obvious now that Softbank's Chairman, Chairman Masayoshi Son is very serious about the T-Mo buyout, and it is also apparent that Deutsche Telekom wants to dump their stake in T-Mobile. Here's a quote with a few more details,

Sources familiar with the Softbank-Deutsche Telekom talks said any deal would depend on whether they can persuade regulators to change their minds.

The two sides have been chipping away at other issues.

One possibility is for Deutsche Telekom to retain a roughly 15 percent in T-Mobile US as part of a deal, the sources said. That would help reduce the size of the equity check that Sprint has to write for T-Mobile US, while giving Deutsche Telekom the chance to benefit from potential synergies from the merger, they said.

Deutsche Telekom may also be more accommodating with Softbank regarding a break-up fee than it was with AT&T, the sources said. That is because T-Mobile is likely to be the surviving brand and its CEO, John Legere, is likely to lead the new combined company, thus avoiding a loss of subscribers and momentum it had to contend with during the drawn out regulatory process with AT&T, two of the sources said.

It's also interesting to note that Sprint has been courting banks to raise upwards of $50 Billion dollars for this deal. This is obviously substantially more than the failed T-Mobile and AT&T merger from two years ago, which was valued at $36 Billion. This makes sense considering how much traction T-Mobile's Uncarrier initiative has made in the U.S. mobile landscape.

Source: Reuters

 

[Dusty]

Should be interesting!

 

[smalltowngirl13]

This will be interesting to follow...you can have either CDMA or GSM (dual SIM, one for each network - should have good coverage everywhere...right)...

 

[bkdodger]

Well I don't know if you would have good coverage.. Lol
You would have both though..
T-Mobile has something uncarrier 5.0 scheduled for June 18... Stayed tuned..

Knock knock G2

 

[metalspring]

Its too bad the T-mobile isnt cdma or Sprint is gsm, if they were then the merger could be a huge asset in competing with verizon and att. Sprint and T-mobile coverage separately isnt really impressive, but combined they might be able to hold up against even att. Right now, the only real ways to make use of the coverage of both are the dual sim (one CDMA, one GSM) mentioned before, or by converting the towers to all CDMA or GSM (probably very expensive and time consuming), I dont think they dont even share the same 4g LTE frequencies.

 

[Jeffrey]

VZW has phones that work on both GSM and CDMA. They called it the World Phone. I think they use dual radios to achieve this. TMO/Sprint would have to supply the same type of hardware to accommodate their customers.

At some point, all their towers will need to be either CDMA or GSM. My bet is on GSM as it's the technology most used worldwide. Anyway you look at it, it's going to be a very expensive transition.

One other thought: They could run both networks under one umbrella, but that would be costly as well.

 

[jackiescivic]

Its too bad the T-mobile isnt cdma or Sprint is gsm, if they were then the merger could be a huge asset in competing with verizon and att. Sprint and T-mobile coverage separately isnt really impressive, but combined they might be able to hold up against even att. Right now, the only real ways to make use of the coverage of both are the dual sim (one CDMA, one GSM) mentioned before, or by converting the towers to all CDMA or GSM (probably very expensive and time consuming), I dont think they dont even share the same 4g LTE frequencies.

Sprint actually has just slightly more network capabilities than VZW and AT&T combined. The issue is the amount of towers Sprint has. With Sprint rebuilding every existing tower from the ground up, the quality of their signal is going to drastically improve for those with newer devices. The biggest advantage Sprint has is the lack of customer base compared to the other carriers. With these tower improvements, you shouldn't experience a decline in speed because of how crowded a tower is.

Sent from my Droid Maxx

 

[benlinus79]

That is going to be a good thing. But who knows.

 

[KaChow]

I happen to fully support the idea of these 2 carriers combining which I think it is an absolute brilliant idea. I've always thought an Unlimited No Contract was the way to go and this combo could be the way of making that happen. I would also like to see Sprint continue to build out on T-Mobile's technology, there's no need for a dual sim, you can run CDMA/GSM off of a single sim card. Sprint does have a lot of technology and capabilities, certainly much more than most anyone gives Sprint credit for. For instance the 800MhZ band can be easily be manipulated on the CDMA network, those with Sprint device could perform something called a PRL swap, which is changing the Preferred Roaming List to improve the signal in their given area, if you have a Verizon PRL you could use that to run your device off of Verizon's network (this is without Root as this is done through the radio.) In fact going back a few years I used an app called Roam Control which was helpful in putting my device with the best CDMA carrier whenever I was in the "boonies". Keep in mind if you are on Sprint and if you use other carrier PRL's too often, you may get termination notice from Sprint.

But, all in all back to the topic, I think this is a good move. I would like to the GSM grow and see Sprint focus on that aspect and push Unlimited Data plans to get Verizon and AT&T to rethink things over.