It’s one of the largest telecommunications deals of all time and could affect 100 million members as well as create the nation’s first 5G network.
Representatives from Sprint and T-Mobile have announced a potential $26.5 billion merger. Should the deal be approved by regulators, T-Mobile CEO John Legere will run the combined company while Sprint CEO Marcelo Claure will serve on the company’s board.
T-Mobile offered the following statement:
“The combined company will have lower costs, greater economies of scale, and the resources to provide U.S. consumers and businesses with lower prices, better quality, unmatched value, and greater competition. The New T-Mobile will employ more people than both companies separately and create thousands of new American jobs.”
Representatives have stated that the combined company will build the first true nationwide 5G network. Given T-Mobile’s access to the 600 MHz spectrum and Sprint’s access to the 2.5 GHz spectrum, this could be possible. Combining the two radio frequency spectrums fills in the holes in both company’s 5G infrastructure. Sprint’s 2.5 GHz frequencies allow for faster overall speed, but can’t travel as far through buildings. T-Mobile’s 600 MHz band overcomes that problem, making for a much more stable and reliable 5G service.
The two spectrums together could also work given T-Mobile’s towers, which function despite how densely packed buildings might be.
T-Mobile has been locked in third place behind Verizon and AT&T for total number of subscribers for years. Sprint lost that position to T-Mobile and has been stuck as the fourth largest carrier ever since.
Verizon had over 150.4 million subscribers during the fourth quarter of 2017, and AT&T had over 141.5 million. T-Mobile’s subscribers topped 72.5 million, while Spring came in over 53 million. Based on those numbers, the new T-Mobile will have about 126.2 million subscribers.
T-Mobile would still trailer Verizon and AT&T following the merger, but would still be in a better competitive position following the deal.
The deal itself isn’t entirely new and the two firms have courted each other in the past. In 2014, it looked like they were close to reaching an agreement, but that didn’t pan out at the time.
The two companies will still need to go through standard regulatory approvals and the deal is expected to be completed no later than the first half of 2019. Should it go through, this would still make the combined entity the third largest cell service provider in the United States, meaning it’s feasible that it’ll receive approval from the U.S. government.
Stay tuned for additional details as they become available.
Via The Mac Observer