The FCC and FTC would love to see another carrier challenge the Verizon-AT&T duopoly. On one hand, a combined Sprint-T-Mobile might present more of a challenge to the pair at the top. On the other hand, there is a thought among the regulators that they should allow T-Mobile to stay independent. The upstart carrier has been leading the industry in pro-consumer innovations, and some staffers at the FTC and FCC would love to see how far T-Mobile can go.
According to New Street Research, both Sprint and T-Mobile do not have enough revenue to cover their fixed costs. The analysis says that the two will need to bring in $10 billion over the next year and a half to be competitive. The report adds that both companies need to buy additional spectrum in order to keep up with demand.
The bottom line is that New Street suggests that both companies be allowed to merge now, which would lead to lower costs for the companies, and lower prices for consumers. If a merger happens because one or both carriers are faltering, the merged company will not be in a good position to challenge the duopoly at the top.