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Is a T-Mobile-Sprint Merger Still Happening?

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So it turns out that the highly publicized merger between T-Mobile and Sprint may not happen at all. Despite recent reports suggesting the merger was nearing fruition, there are new reports that show the merger may not happen at all.

According to a report published by Nikkei, Sprint's parent company, SoftBank, wants to put a close to the merger talks with Deutsche Telekom, T-Mobile's parent company, because of a "failure to agree on ownership of the combined entity." The merger talks are reportedly proposed to end tomorrow, October 31st.

Ever since the merger was on the table, Deutsche Telekom has insisted on being in control once the two companies worked together. For quite some time, some people at SoftBank were okay with giving up control as long as they still had some influence in the merger.

Unfortunately, SoftBank's board recently made a decision that they will not give up control. Because of this decision, they are determined to call off merger talks with Deutsche Telekom.

Prior to today's decision, reports show that the two companies had already made a broad agreement and were already ironing out the smaller details of the deal. The merger was already anticipated to be announced in November but today's decision puts all these reports down the drain.

It may be because the two companies were unable to agree on how much control they had over the merger between T-Mobile and Sprint. Just like what was published on Reuters, which shares that SoftBank has concerns on losing control once the two companies combined. Meanwhile, another report from CNBC shows that although there are present struggles, SoftBank does not plan to back out from the deal.

Our guess is that these two companies just need to iron things out privately before they come to an agreement that would be equally beneficial for each other. And yes, we're still hoping for that merger to happen.


Source: Tmo News   

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40 comments:

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  1. Replies
    1. Knee jerk reaction.

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    2. I agree. Look at areas where there is a duopoly or monopoly for cable and internet. Prices are high, speed is low, and customer service non-existent. Competition is good.

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    3. "When the ~20,000 redundant jobs are eliminated"

      Nationwide,there is a duopoly already for good nationwide cell coverage. This merger would be the best chance for T-Mobile to become a third player

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    4. metro pcs got 4 unlimited lines for $100 boost followed with 5 lines for $100 unlimited, Do you thing this will happen in the future ? yeah right? competition is great for consumers

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  2. This is good news to all except for MAYBE the top dogs at Deutsche Telekom and SoftBank who want to be in control and reap from the BULK of the prospect monopoly.

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  3. I am so glad this deal is dead! Go away Sprint and work on fixed wireless.

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  4. Id actually like to see if a merged company could provide a network to compete w verizon and att. That might give me a realistic third option rather than the current two which simply cannot compete based on network coverage when outside a large metro area.

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    1. T-Mobile and Sprint footprint is almost redundant, and they use the same cell towers which neither of them owns, so coverage area is not going to get any larger if they merge.

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    2. No, but they'd double their subscriber base and be able to cut probably 20-30% of combined redundant "operational costs", which will boost profitability in the short term (Sprint is losing money each quarter right now) and give them margins to engage in price wars in the long term.

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    3. You're forgetting the buttloads of delicious spectrum licenses, which equate to increased coverage and capacity.

      After all, carrier aggregation in a currently shitty coverage area for both might soon produce decent post-merger data speeds once Sprint is fully assimilated.

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  5. On one hand I would like to the merger, as many of us cannot use Sprint due to it's coverage and lack of volte. But the downside of the merger is reduced competition.

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  6. Flip a coin, it could still go either way... Sprint though NEEDS TO DIE... lmao

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  7. Majority share holder of Deutsche Telekom.....the German Government! Cough, Cough...

    Tea-Mobile will be perfectly competitive with Verizon once their newly acquired 600 MHz frequency is rolled out, or whatever it is.

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    1. Hi from Germany.
      T-Mobile USA is owned only 2/3 by Deutsche Telekom.
      Deutsche Telekom in return is only 1/3 owned directly or indirectly by the German state. The rest are free floating shares.

      The problem with their new 600 MHz band is that there is hardly any device on the market capable of it. Not even the latest iPhones (100% US lol).

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    2. Qualcomm (US company) has a new chipset that lets 700 MHz modems and antennas connect to 600 MHz signals. There will plenty of mid-range and entry level phones available next year along with the flagships that can use the Tmo 600 MHz. Of course no German phones will be available.

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    3. 1/3 of 2/3 is still 22+% which makes the German state a "MAJOR" shareholder (not majority).

      There will be plenty of newer phones with T-Mobile's 600 MHz bands available by the time it rolls out in most markets later next year as stated earlier.

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  8. "And yes, we're still hoping for that merger to happen.", quote from the article above.

    Did you fail economics 101 ?

    The last thing that the consumer needs, from both a pricing and customer service perspective, is for most of the limited and government controlled cellular radio spectrum to be concentrated with three companies, rather than four.

    A better merger, for both Sprint and the consumer, would be with someone that has fiber backhaul infrastructure;that would be a cable company.

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    1. Econ 101 is a pseudoscientific cover for the kind of scorched earth self-interest that focuses entirely on short term enrichment for investors at the expense of both the business and its host community.

      In other words, getting "kindly escorted" out of Econ 101 is the first step in sound economics.

      If you'd failed it too, you'd agree that Sprint is a toxic asset that's losing money fast, and which requires heavy investment to both pay debts and build out a competitive infrastructure.

      T-mobile already has a decent enough infrastructure in place, making it the most well suited to get the most out of Sprint's assets (such as spectrum and equipment), which is necessary in a buyout where the immense liabilities can only be offset by limiting needed investment, maximizing economic gains and nearly doubling the revenue producing consumer base.

      In contrast, while a cable company might have the backhaul, but it'll be incredibly painful to pay debts and build out infrastructure with Sprint's increasingly dwindling revenues, all while the promise of better profits remains an idealistic best case scenario that begins with throwing good money after bad.

      They also have Softbank's massive failure staring them in the face, warning them about the economically crippling pitfalls of trying to make it in the US mobile industry when you don't actually have a plan for rebuilding Sprint.

      After all, merging was Son's Plan A through Z, and everyone knew Sprint was doomed the moment said merger was denied.

      Seeing that, no cable company would be stupid enough to repeat Softbank's mistake of buying a doomed carrier in hopes of a merger, and merging with T-mobile is Sprint's last best chance of saving itself.

      On a related note, that's what makes Softbsnk's obstinance so self-defeating.

      They's proud, arrogant and completely out of touch with the reality that they need T-mobile to buy Sprint, even though T-mobile itself doesn't need to do so in order to stay competitive.

      At this rate, Softbank's board will just wind up driving their subdidiary straight into an inescapable bankruptcy, much like the proverbial mother who tore her child in two when she refused to let go.

      Maybe they don't have that proverb in Japan, but if you're willing to kill Sprint to keep control of it, then you probably shouldn't have control of it in the first place.

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    2. " ...Did you fail economics 101 ? .."

      Balderdash. You failed to make any sort of case at all.

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    3. AnonymousOctober 31, 2017 at 1:39 PM... What's wrong with Sprint filing for bankruptcy? Bankruptcy does not require killing Sprint/ceasing operations;many companies operate in receivership until their debt-load is reduced/dismissed and/or exchanged for equity. Everyone seems to agree that their debt load is the problem. Bankruptcy is a legitimate way for Sprint to reduce the debt-load and remain separate from Tmobile. Host community preserved, business preserved and investors lose.

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  9. I'm very happy that the merger may not go through. We need more competition and not less. Now this development will allow Sprint to focus on fixing their many issues that they have.

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    Replies
    1. Sprint. "Dead Hoarse Wireless" has had years to focus on fixing stuff but it never does. It's assets are wasted. As Sprint is failing to compete, we have 3 carriers whether or not T-Mobilr takes it over.

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  10. Such pettiness.
    Just let both carriers improve their networks.
    That is where the work needs to be done.

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    1. You're not thinking. They don't have enough money to do this, or they would have by now. T-Mo has made huge progress, but after spending $8B for 600 GHz spectrum and more $B deploying it, where will they find the money to deploy 5G across the whole network?
      Sprint is mortgaging its spectrum and towers to get cash to make loan payments, but giving away service to attract new customers. This can't go on forever. If they can't afford to deploy 2500 spectrum, where will they find the money for 5G?

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  11. All rumors and speculation by Wall Street scammers.

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    Replies
    1. "All rumors and speculation by Wall Street scammers"

      Which scammers do you refer to?

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  12. If SoftBank did well at running a mobile phone carrier in the United States merger negotiations wouldn't be happening at all.

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    1. There are only two kinds of people who oppose the merger:

      A) Duopoly shills who propogated the self-serving narrative that a third major competitor WON'T pressure the duopoly, and B) the sheeple who gobble up the narrative and use it for shameless virtue signaling even though they're really spreading lies for power.

      Neither one cares about Softbank's blatant incompetence over the past few years.

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  13. Neither offer much if any service in my area, I could care less about them

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    1. If the merger goes through, that might change.

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    2. The proposed merger will be a job-killer for redundant employees and bad for consumers. IF it goes away, I for one will be glad.

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    3. When the ~20,000 redundant jobs are eliminated, the combined company can invest in the network, compete for new customers with lower prices and pay off debt. Those things are all good for consumers unless they are part of the 20,000 fired employees. If Sprint goes bankrupt, 50,000 jobs are at risk of loss.
      I'm guessing you'll still be glad.

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    4. It would be very good for consumers by making one of the three existing competitors much stronger.

      As for "redundant employees", they should find work that is actually needed, not redundant.

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    5. "Neither offer much if any service in my area, I could care less about them"

      Exactly. For much of the US, there are only two choices. Tell real competitors for a true nationwide network. A merger would make for more completion by making T-Mobile the third contender.

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  14. "When the ~20,000 redundant jobs are eliminated"

    Redundant jobs are jobs that aren't needed. Busy work/charity/welfare.

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  15. "Control" my eye... SoftBank just wants to play chicken and try NOT to sell out at fire sale prices. SoftBank has taken Sprint on a controlled descent into terrain. In truth, I think the debt load and requirements imposed on any merger is sure to be a boat anchor around tmo's neck, just as Nextel was to Sprint...

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  16. SoftBank reportedly waiting on final T-Mobile-Sprint merger proposal from Deutsche Telekom. Supposed to be delivered this week. SoftBank wants to give DT fewer than 8 Sprint Shares for every Tmo share they receive. They want Son to be Co-CEO (hard to manage this way; I can imagine Ledger's reaction). Current agreement is that Sprint has to give more than 9 shares, and Tmo has control of the combined company.
    $50B in synergy value is at stake, along with Sprint's future as a viable competitor.

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    1. Son is a tough negotiator, and that is what is playing out. He has re-opened talks with high-level execs at Charter, and still has time in his agreement with Comcast to begin negotiations. If Tmo won't budge, look for Son to ask for $ from Charter or Comcast in exchange for a wireless agreement. Son needs their $ for network investment. He has starved Sprint CAPEX to save money, and has to start spending again to improve the network and prepare for 5G deployment. Comcast has their Xfinity Mobile agreement with Vzw, but Sprint originally offered better terms and can do even better if they have to.
      Sources: Fierce and Tmo News today

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  17. T-Mobile and Sprint Agree to Merge and Unite Under T-Mobile Brand and Leadership Phonescoop - https://www.phonescoop.com/articles/article.php?a=20531

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