Sprint regroups, reconsiders bid for T-Mobile in light of U.S. regulators' wariness
A published report Sunday evening states that both Son and Hesse were surprised at the regulators' distaste for the deal, although the SoftBank founder is still considering going ahead with it anyway. The argument that Son and Hesse are making is that the only way to challenge Verizon and AT&T, the top two mobile operators in the U.S., is to allow Sprint and T-Mobile to combine. The nation's top two carriers own 67% of the wireless market in the states, and there are those who believe that T-Mobile's recent momentum will eventually fade.
The regulators have also taken their case to the public, something unexpected by SoftBank and Sprint. Bill Baer, head of the Justice Department's Antitrust Division, spoke with the New York Times and even mentioned his distrust of wireless consolidation in a speech before the New York Bar Association. Both SoftBank and Sprint will report earnings this week, giving both companies a chance to reveal any new plans.
Sprint CEO Dan Hesse might know exactly how the naysayers feel. When AT&T made its failed $39 billion bid for T-Mobile back in 2011, Hesse was one of the most outspoken critics against the deal. Now, three years later, in a much different landscape for the mobile carriers, Hesse finds himself on the other side of the transaction.
For Masayoshi Son, pulling out of the deal before it is announced means not having to worry about paying a break-up free to T-Mobile that Sprint cannot afford. Son has been concerned with the fee, which would only be paid if both sides commit to a deal and one of them decides to pull out of the transaction. When AT&T decided against challenging the Justice Department and pulled out of the deal with T-Mobile, the latter received $3 billion in cash and some very strategic spectrum from AT&T.
1. Gemmol (Posts: 660; Member since: 09 Nov 2011)
Its true I think its a fad too, seen some people in New York who recently switch to tmobile only to switch back to AT&T. I wish they had listen to me when I told them my friend only get one bar when he put his phone by the window. I could not live like that, but I think in 2 to 3 years tmobile can be better. It all takes time, I remember when my other friend who had a Verizon phone had service in places where I did not, now I got service where he do not .
2. Libra1985 (Posts: 47; Member since: 26 Feb 2011)
Sprint and Softbank should keep the focus on getting Sprint a solid foundation and completing projects before taking on other adventures.
3. Mrmark (Posts: 198; Member since: 26 Jan 2013)
Yes a solid foundation is key ... But first and foremost they need a good architect which in my opinion is non existent. So at this time it seems like there plans before they start there project are not finished.
9. ajac09 (Posts: 1447; Member since: 30 Sep 2009)
Sprint and softbank seem to have the same moto: When your network is falling apart you spend all your money on new networks that wont work for most customers and on acquisitions that wont happen.
4. Droid_X_Doug (Posts: 5993; Member since: 22 Dec 2010)
Sprint is not going to be allowed to acquire T-Mo. Period.
5. o0Exia0o (Posts: 653; Member since: 01 Feb 2013)
Like I have been saying Dish would have a better chance of buying T-Mo than sprint, this just proves my point (as if the goverment would have allowed this to happen in the first place).
6. tigermcm (Posts: 832; Member since: 02 Sep 2009)
i feel any mobile company has a better chance than a cable company
7. Professor (Posts: 200; Member since: 02 Aug 2013)
I live on NYC. I used to have AT&T and Sprint. For the last few years I have T-Mobile. My reason for changing from then to T-Mobile was price. I less than half now that what I used to pay when I was with AT&T and Sprint. Yes... My signal is not as good as when I was with AT&T but it is way better than what it was with Sprint. I get signal in places in the city where Sprint was completely useless (no signal at all). Never tried with Verizon because I cannot afford Verizon prices (currently double the price per month than T-Mobile)... I will not like Sprint buying T-Mobile just to destroy it like it did with Nextel. Sprint just want to buy T-Mobile because its scare that if T-Mo continue advancing the way is doing soon is going to have more customers than Sprint. And since Sprint is probably loosing most of its customers to T-Mobile buying the company is their real only way to stop being eated by T-Mobile since they cannot do it thru customer satisfaction...
8. QWIKSTRIKE (Posts: 955; Member since: 09 Mar 2010)
I LIVE IN NYC TOO, And since 1997 I have been with Sprint. Sprint in NYC has always had a great signal. I don't know what you are talking about, but signal was great until they started upgrading for network vision. I also drove from Massachusetts to Florida via I95 and never dropped a call the whole trip.
Sprint may be behind in Speed, but coverage wise they are way ahead of TMobile. Since I rely on mobile calls more than mobile data I can wait for better net work speed improvements.
I can stream Netflix 99% of the time with no caching unless I go to the Pocono's. In the Pocono;s my friend does not get service with Tmobile.
10. ajac09 (Posts: 1447; Member since: 30 Sep 2009)
↑ paid for by sprint. I remember a couple of years ago coming back to the east coast to visit family I roamed for most of the drive from the airport in North Carolina all the way up to NYC. In places that sprint showed having great service .. the service sucked. Went back with AT&T a year later and I was able to use my phone EVERY where with no issues.
15. lsutigers (Posts: 816; Member since: 08 Mar 2009)
Paid for by Sprint, are you serious???
Dude there was obviously something wrong with your phone...Sprint has very good coverage, much better than TMO and similar to AT&T, not to mention that you were on the insterstate. And you say you were roaming all the way from NC to NY????
Some people just have no common sense at all.
16. a_merryman (Posts: 749; Member since: 14 Dec 2011)
It is laughable that he says that. I've made the trip from VA to NJ numerous times and didn't roam for more than a couple minutes any of the times, from VA to SC I roam exactly once for like 20 minutes at the bottom of NC every time...don't know what is going on there.And drive across VA often and find myself roaming less often than my friends on AT&T. Pretty sure a good portion of people who claim Sprint sucks have never had it and are just she*p who like jumping on bandwagons, the same type who get too worked up over Samsung vs. Apple and such.
17. a_merryman (Posts: 749; Member since: 14 Dec 2011)
Agreed, living here in the DC area and service has been good since I got it a few years ago. Even convinced my gf and her family to switch over, and she has been loving the unlimited data since she used to have to stop listening to spotify part way through the month with AT&T. I have an iPhone 4S, which means no LTE, and I can still stream spotify no problems most of the time. I streamed it the entire way on a road trip to SC recently.
11. JGuinan007 (Posts: 659; Member since: 19 May 2011)
The best match for T-mobile would be for US cellular to buy or merge with T-Mobile. The only other option the Gov would allow would be for other communication companies non cellular like Dish, Comcast, Google, or Apple buy T-Mobile. I'm not a Fan of Apple but that would be interesting to see what would happen if they had their own network the company is sitting on 200 billion any way and you know millions of apple fanboys would switch to T-mo just because apple bought it, that purchase alone would double Apple stocks and they could really concentrate on improving T-mo network. In three years T-mo would be bigger than Verizon.
13. Augustine (Posts: 984; Member since: 28 Sep 2013)
Why, so that Apple may ban Android devices from T-mobile? Besides, it'd make no sense that a brand which couldn't care less about value would associate itself with the best value carrier.
12. joe1blue (Posts: 160; Member since: 25 Jul 2013)
Sprint service is just horrible period. If Tmobile extends their coverage then sprint would be done!
14. Augustine (Posts: 984; Member since: 28 Sep 2013)
If SoftBank is hellbent on bidding and the feds are inclined to deny the merger, may Son please go ahead. T-mobile was probably capitalized for its recent moves thanks to the cash and spectrum that it got from AT&T. Some extra cash and spectrum would probably catapult it ahead of Sprint.
18. jamesedward318 (Posts: 99; Member since: 25 Dec 2010)
I think Son saw the error of his ways buying up Sprint. He wants and wanted to save face by purchasing T-Mobile so he could essentially break even. This time next year we will talking about Sprint, Virgin Mobile, BOOST and other little under companies being bought up by AT&T, Verizon and T-Mobile.
19. bweaver731 (Posts: 4; Member since: 20 Dec 2012)
I think that a Sprint and T-Mobile merger would be beneficial for both parties. T-Mobile lags behind every major carrier in their network coverage for both voice and data. While T-Mobile has made major improvements in major metropolitan areas, lets not kid ourselves, a large percentage of their coverage area shows 2g coverage. Sprint is improving. As a long time customer (7+ years) I can say they had their struggles but Network Vision is helping me to believe they have an atainable plan to finally improve their network.
While the Nextel acquisition was an epic failure, I believe a merger with T-Mobile would be beneficial if they could incorporate GSM into their current network. Network Vision allows for them to add additional network standards, but their SPARK initiative seems to be pointing to a network heavily reliant on LTE, but GSM would be a better fallback strategy than CDMA because HPSA (plus) produces speeds that are near LTE speeds. It would be a risky venture as their previous attempt to merge competing technologies failed miserably, but the forward thinking of Network Vision has positioned them to be able to better incorporate new and different technologies into their base stations which should allow them to execute a merger with more success if they do indeed execute it.
I just hope they keep the T-Mobile CEO on staff as he seems to have more business save than Hesse.