T-Mobile: further industry consolidation isn’t a question of if, but when

sprint-mobile

If there was any question that T-Mobile was entertaining the idea of a Sprint merger, a recent statement by T-Mobile CFO Braxton Carter hints that it could be all but inevitable. Speaking openly during a telecom conference today, Carter said that in regard to his company’s future prospects for consolidation, it wasn’t a question of “if” but “when.” This echoes a similar statement Carter made last year, after T-Mobile purchased MetroPCS. And while the words “Sprint” never actually left his mouth, investors are now anticipating a Sprint merger is likely. You know, should US regulators give it the green light.

Last week Deutsche Telekom — T-Mobile’s parent company — said it would be open to potential consolidation in the U.S. mobile market, but also mentioned that they were in no hurry to make such deal (they’ve always been open to merger talks in the past). According to them, T-Mobile has performing well enough to continue running by itself. But as Carter points out, “To take a third-scale national player that has the scale benefits with the right business model could be very competitively enhancing in the U.S..” In other words, AT&T and Verizon should probably be watching their backs.

Something tells us they aren’t too worried. It was back in 2011 that the US Department of Justice and the Federal Communications Commission shot down AT&T’s proposed buyout of T-Mobile for a cool $39 billion, leaving AT&T walking away bruised and broken. Sounds they wouldn’t be too receptive of a Sprint/T-Mobile merger either.

Carter goes onto say that the government can’t simply have its cake and eat it too. “If they think there really needs to be four players in this market on a nationwide basis, they are going to have to put some structural protections to ensure an adequate distribution of spectrum.”

Sprint has been gunning for T-Mobile for years now. In 2010, Sprint CEO Dan Hesse went on the record about merger talks with T-Mobile. In 2011, talks of a merger once again began rearing their head, followed by a recent report last December saying Sprint would offer upwards of $20 billion to buy T-Mobile this year, but was still feeling things out. Like that persistent dude in the movie theater, Sprint really wants T-Mobile’s number.

I guess John Legere never received the memo, T-Mobile’s off-the-wall CEO who continued blasting away at rival carriers on Twitter. In a recent tweet, Legere specifically calls out Sprint saying, “Remember when people actually liked @sprint? Yeah, me either.” It’s clear Sprint is going to need more than just Carly in tight leather to drawn in new customers. Upgrading their slow as molasses network would be a good start.

[Reuters]

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  • CryptoNoel

    man, a merger would be a MESS! sprint can’t even handle ITSELF…

  • moises1204

    hahaha, i see tmobile laughing all the way to the bank with their red face and horns on both side of their forehead, hoping sprint tries to buy them out an the deal falls trough and then collect the breakup fee like they did with at&t.

    • http://twitter.com/gamercore Chris Chavez

      Funny thing is, I’d be more than happy with T-Mobile buying Sprint (but not the other way around). Too bad Sprint isn’t the one up for sale.

      • Erstam

        This is exactly how I feel as well.

      • Scotsman of Loch Ness

        I left sprint for T-Mo beacause Sprint just kept charging more and more and not delivering.

      • http://twitter.com/SParKlngCyaNide SparklingCyanide

        Seriously this mahn!! If only… if only.

    • spicymeatball

      That would be great. Keep getting the competition to finance your growth.

  • supremekizzle

    I will petition to block the Frick out of this.

  • Rdfry

    I will complain like a mofo. No f###ing way do I want Dan Hesse or Sprint.

  • Dominic Powell

    T-Mobile needs to buy US Cellular somehow… Plenty of complimentary spectrum to be had there. Alongside users that are used to paying premiums for service.

  • J Cav the Great

    Sprint offered upwards of $20 billion to buy Sprint? Typo

  • spicymeatball

    John Legere needs to lead some kind of employee buyout of Deutsche Telekom. I don’t know if this is even possible now that they are traded publicly. Or maybe have a loyal customer take over to preserve them and the direction they are going. Actually, my first choice would be for Dish to buy out T-Mobile and let John Legere run the new company. I think Dish still has a ton of spectrum.

  • BronzeLincolns

    awwwwwww maaaaaaan….

  • http://twitter.com/Vanakatherock Vanakatherock

    Sprint > T-Mobile in my area. My brother and his family were T-Mobile customers for over 10 years and finally got tired of their terrible coverage. They switched to AT&T. They were barely getting 3G at their house while I was getting LTE on my Sprint GS4.

    I could, however, see a T-Mobile/Sprint merger happening. Just not anytime soon.

    • Scotsman of Loch Ness

      For me it’s exactly the opposite. T-Mo is stronger than Sprint in my area. That plus international free data roaming, plus wifi calling, plus soon to have international texting.. All for a lower price than Sprint.

    • Jroc869, Nexus-Life

      I guess there is always that one market where things just seem to work backwards.

      • http://twitter.com/Vanakatherock Vanakatherock

        I’m 100% certain there is more than one market where Sprint service is better than T-Mo. Even in instances where it will be better than AT&T service as well.

        • Jroc869, Nexus-Life

          I’m 100% sure it was a joke, obviously I couldn’t know about every market in the country.

  • Alberto_jr

    Wait. So how would this work? CDMA is what spring is. T-mobile is something else? And I right? You can’t just connect the two networks

    • 808Bill

      You mean like how GSM T-Mobile was able to with CDMA Metro-PCS?

    • Danny Alvarez

      They will most likely begin moving Sprint customers to GSM phones and dropping their CDMA for GSM like they did with MetroPCS.

      • http://twitter.com/Vanakatherock Vanakatherock

        Actually, that is not likely what would happen considering Sprint would be the one buying T-Mobile. In the instance of T-Mobile/MetroPCS, T-Mobile bought out MetroPCS and moved their customers over to T-Mobile’s network.

        • Danny Alvarez

          I doubt they would move T-Mobile to CDMA though, since it is an older network, which is why I said Sprint would most likely migrate to GSM.

    • Jerel Butler

      Considering lte is gsm based and all sprints flagships are world phones yea this could work

  • Danny Alvarez

    Unless they let John Legere to handle the merger, this is going to be a disaster. He handled the T-Mobile MetroPCS merger so nicely. He knows how to do it.

  • chuckles87

    T-Mobile sure can talk a lot of shat. But with their deceptive billing they can frack themselves. The at&t network is better I never see the dreaded E in my status bar that I saw almost half the time while using T-Mobile

    • NinoBr0wn

      Deceptive billing? Lol

    • Bailey Neff

      I know what you mean, T-Mobile has been deceptively billing me $130 less than AT&T was. Darn them!….wait, what?

      • chuckles87

        Well I hope T-Mobile sends you an $802 bill when you are only supposed to pay $217/month good luck getting any help from them.

    • http://twitter.com/SParKlngCyaNide SparklingCyanide

      The Only thing deceptive is this misleading comment.

    • Jared Andrada

      What? I don’t know whats so deceptive about me paying $140 (after taxes) for 3 lines per month.

  • lynyrd65

    DT and SoftBank:
    Consolidation is inevitable, because… We’ll because we say so

    DOJ:
    Yeah good luck with that.

  • TONY ALDO

    How is T-Mobile even up for sale? or is this simply a 51% stock purchase?

  • Wilfredo Martinez

    T-Mobile’s CFO and CEO as well as Deutsche Telekom and Softbank CEO needs to stop with the bull***t. There is to be no consolidation between the 4 nationwide base wireless carriers. Enough is enough…. You want to grow? Bring something new to consumers plates and you will get the results you want! Expand your coverage to areas not available, make strategic moves to bring consumers from other networks to give YOUR network a try, DO SOMETHING. Not just sit on your behinds and take the EASY way out, by merging your company with a direct competitor such as Sprint Corporations. Canada has 3 major wireless companies and what have they done? COLLUDE ON PRICES AND ANTICOMPETIVE BEHAVOUR WITH LITTLE OR NO INNOVATION AT ALL! This is not want U.S consumers want!
    Merging Sprint and T-Mobile is NOT in the public interest, it would create a large company equal to Verizon and AT&T which would collude with both of them to have fixed prices and less innovation!