Sprint and T-Mobile merging?

[Bateluer]

http://www.androidpolice.com/2011/03/08/could-sprint-and-t-mobile-be-merging/

News comes this morning that Deutsche Telekom has been having talks to sell its T-Mobile US unit to Sprint in a deal that would combine the third and fourth largest US carriers. Deutsche Telekom would reportedly still have "a major stake" in the newly merged company, so this would be seen as more of a merger than a selloff.

Hmm. This doesn't seem like a smart move for Sprint? How much money to convert T-Mobile's network to Sprint's network, and then again when Sprint has to convert their WiMax network to LTE. Seems like it'd be a VERY pricey endeavor.

 

[Deeko]

This has come up a bunch of times. I'm not saying its impossible, but I'll file it in the "I'll believe it when I see it" folder.

While both T-Mobile and Sprint have hinted at eventual LTE migrations, neither of them are in a rush. This merger seems like it would be difficult until then.

 

[dguy6789]

Agreed. As great as it would be for both companies to merge, the problem is that one is GSM and one is CDMA.

 

[DivideBYZero]

The "merger" of Tmo and Orange in the UK isn't quite what it at first seemed. From a users standpoint it means you can make calls on each network... and that's it. The agreement covers, get this, 2G only. I was expecting my WiFi hotspot G1 to be a 3G powerhouse all over the UK, but no, it's not. Great for calls, crap for data, and they only had to do this as the other carriers were owning them with tower count.

Even the cutomer service reps are still separate and know nothing of the other side in many a case. E.g, Tmo can transfer a CSR call to Orange, Orange can't switch it back when you're done. Plans are still different on each network and not portable, etc, etc.

Basic upshot is, even if it's true, don't get too excited by it.

 

[boomhower]

You would have thought Sprint learned their lesson of merging two companies that operate using different technologies with the Nextel debacle. Once they both move to LTE it would make a lot more sense but that is going to be years down the road.

 

[SunnyD]

Agreed. As great as it would be for both companies to merge, the problem is that one is GSM and one is CDMA.

Sprint has all but committed to going LTE in the next 3 years. T-Mobile has a vested interest in moving to LTE even though they appear on the surface committed to HSPA+. On these grounds a merger seems like a competitive advantage.

On the other hand, why DT wants to take on Sprint's massive and ever increasing debt, I'll never know. But on the other hand, it gives DT access to Sprint's massive spectrum holdings, meaning that a shift to LTE for T-Mobile might be more likely to happen given that Sprint has licenses for a good amount of more desirable spectrum than T-Mobile holds.

 

[Patranus]

You would have thought Sprint learned their lesson of merging two companies that operate using different technologies with the Nextel debacle. Once they both move to LTE it would make a lot more sense but that is going to be years down the road.

So you suggest they merge after they both deploy LTE in the same markets?

It makes more sense to merge before the deployment of LTE reducing parallel deployment.

 

[corkyg]

Not really a merger. Sprint-Nextel wants to buy DT's T-Mobile (USA), which for DT, is a current loser. This was announced and discussed this morning on Bloomberg - consensus of analysts was a win-win.

http://www.bloomberg.com/news/2011-...ss-sale-of-t-mobile-usa-to-sprint-nextel.html

 

[Slick5150]

Merging in the telecomm world doesn't mean the same thing as it does in other sectors. Sprint and T-Mobile wouldn't continue operating 2 separate networks. Much like the Sprint-Nextel merger, eventually Nextel customers were moved over to the Sprint network over time until the point where the old Nextel network no longer existed (it no longer does).

So, it isn't a big deal in any way that one is CDMA and one is GSM. If you were a T-Mobile customer, your phone would still work through their GSM network as it always did even if you technically become a "Sprint" customer. It's just that in time, when you goto upgrade your phone, you'd be getting a phone that works on Sprint's network instead (with WiMax, or LTE, or whatever the hell they're going to be using at that point).

 

[Pliablemoose]

Yep, sprint will just swallow up TMobile's customers over time...

I knew something was up with TMobile, they must be trying to shed the less profitable acts...

 

[gsaldivar]

The barrier to entry for wireless providers is huge, and there are only a limited number of competitors in the US, further consolidation would tend to increase prices and reduce that competition even further...

I think there is a good chance that Sprint + T-Mobile wouldn't get past regulators.

 

[the DRIZZLE]

The barrier to entry for wireless providers is huge, and there are only a limited number of competitors in the US, further consolidation would tend to increase prices and reduce that competition even further...

I think there is a good chance that Sprint + T-Mobile wouldn't get past regulators.

You could argue that its good for consumers. It's not economically efficient to have 4 carriers build 4 sets of towers to cover every square mile of the country. What's the optimal number for consumers? I have no idea.

edit: Also having a strong number 3 can sometimes be better for competition than having a weak number 3 and number 4.

 

[Suspicious-Teach8788]

You could argue that its good for consumers. It's not economically efficient to have 4 carriers build 4 sets of towers to cover every square mile of the country. What's the optimal number for consumers? I have no idea.

edit: Also having a strong number 3 can sometimes be better for competition than having a weak number 3 and number 4.

but then what happens when there's only a strong #1 and a weak #2 and #3? the cycle repeats

but honestly its not very economically efficient to have 4 sets of networks even though 2 are technically interoperable on the 3G platform.... thus by having 4 sets of networks it forces us to have 4 different sets of phones to work on all the networks... kinda idiotic.

i look at taiwan for example and there's like 3 major carriers, but they all operate on 1900 GSM or 2100 UMTS, so they can at least swap handsets and roam easily