Sprint may give way to T-Mobile brand if merger goes through, break-up fee possibly much higher

Sprint may give way to T-Mobile brand if merger goes through, break-up fee possibly much higher
As the wireless industry ponders what life might look like if Sprint and its parent, SoftBank, are able to acquire T-Mobile USA in a $32 billion deal, reports are surfacing stating that the agreement between the two companies has a bit more at stake than originally thought.

First, the break-up fee, originally reported by The Wall Street Journal as being $1 billion, may actually be $2 billion. While that is not as big a check that AT&T had to write when it unsuccessfully tried to buy T-Mobile, it is quite a bit bigger than some thought, given reports that SoftBank’s Masayoshi Son did not want to throw away money in such an endeavor.

Assuming that this merger were to take place, what might the new company be called? There has not been a whole lot of conjecture on this front, but the prevailing thinking at the moment is indicating that T-Mobile would be the surviving brand for the new company, and John Legere along with his whole management team would be in charge.

That last part is something that has been rumored as a given, considering that Legere has turned T-Mobile into the fastest growing carrier on the block in less than two years, and has forecast continued industry leading subscriber growth for the rest of the 2014.

All this is for naught right now, as there has not been any official announcement from any of the interested companies, though the remarks by the principle players involved clearly indicate that the discussions at least took place.

via: FierceWireless

FEATURED VIDEO

50 Comments

1. ckoch125

Posts: 193; Member since: Oct 29, 2012

As long as legere is in charge this could be a good thing. Don't let any sprint people in charge, sprint has been awful with ruining good things.

42. DonkeySauce

Posts: 194; Member since: Dec 03, 2011

ckoch125, I think you mean that Sprint has been GREAT at ruining things.. lol! I don't think anyone could have done a better job at flushing Nextel down the toilet! :(

2. PootisMan

Posts: 266; Member since: Aug 02, 2013

Interesting...

7. lsutigers

Posts: 832; Member since: Mar 08, 2009

What happened to last week's report that both names were going away in favor of Softbank USA?

16. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Can we say that Son-boy is desperate? He screwed up with acquiring Sprint, and now he needs to acquire T-Mo to make the deal work by screwing the U.S. wireless consumer. Only thing is, the U.S. DoJ and FCC aren't having any of the sh*t that Son-boy is trying to peddle. T-Mo is going to be getting another break-up fee. Probably around early 2015.

34. OldNorseBruin

Posts: 235; Member since: Mar 12, 2013

DOJ, FCC...and the FTC are going to "deep six" this POS deal. GO home MidgetSonOfB.

3. Whateverman

Posts: 3295; Member since: May 17, 2009

Keeping the T-Mobile name would be a smart move. The Sprint brand doesn't exactly inspire confidence. I know I would feel a little better about this whole thing if T-Mobile was in charge.

4. DMDoleman

Posts: 3; Member since: Dec 14, 2012

Hmmmm Sprint would be a better surviving brand name I think only for many reasons this merger would be an interesting one due to Sprint having way better 3G/4G coverage as T-Mobile may be the UNCarrier but go outside of any major area well your in 2G paradise even where i work its 2G all the other Big 3 have at least 3G but in my area its all 4G LTE

5. Angst

Posts: 35; Member since: Apr 29, 2014

Yes, but you missed a very important point: NO ONE LIKES SPRINT. (/opinion) Seriously. Sprint may have a bigger foot print of coverage, but they also have a bigger area of FAIL. Sprint has proven time and time again to be incompetent as a feasible carrier. Heaven forbid the merger becomes a reality instead of a rumor. The only way I see this as a positive thing is that T-Mobile swallows Sprint - Spectrum et al and slowly converts CDMA to GSM. or at least make dual-band phones and use T-Mobile's Engineers to get the CDMA counterparts up to a decent speed. Just My $0.02

20. Slammer

Posts: 1515; Member since: Jun 03, 2010

---"Yes, but you missed a very important point: NO ONE LIKES SPRINT. (/opinion)"--- Opinions don't make great arguments for debate. I would suspect that the 51 million customers of Sprint would agree with me. John B.

27. joe1blue

Posts: 169; Member since: Jul 25, 2013

Sprint has on average higher prices than T-Mobile and way worse service and data speeds the only people who still have sprint are the people who are still stuck in a contract. Sprint is leaving a bitter taste in a lot more people than you think trust me your the first person I've seen that will pay a sprint bill knowing the other people are paying the same or less and getting Way better service, I use to be the same way until I just woke up one dsy after a not ringed missed call and said F**k sprint!

38. g2a5b0e unregistered

You're generally a very logical person, John, but your argument lacks substance as well. You essentially just argued that all the customers of a company must like the company. Sometimes people have no choice. Other times, they become unhappy with a company over time & just become complacent their unhappiness or are just too lazy to find out what the other options are. Either way, for you to think every single one of Sprint's customers are "happy customers" is quite short-sighted. I know quite a few who have been unhappy with Sprint for years, yet for some silly reason, are still Sprint customers.

39. Slammer

Posts: 1515; Member since: Jun 03, 2010

Well , I'm not going to disagree with you very much here. However, just remember, it would be shortsighted to feel that there aren't people on other carriers that feel the same way about their carriers. The wireless industry is relatively young and it changes very quickly as it grows. It going to get more complicated as it evolves further. It's mix of game, chance and technology advancements.The consumer is susceptible to a lack of strategic plan to help win it. I know people paying top dollar for coverage they never use, minutes they never use and I also know people that need or want more but won't ever step up. It's not always the carriers faults. Consumers get very confused so they stick to a comfort zone. John B.

46. JEverettnow

Posts: 228; Member since: Mar 11, 2013

Most Sprint customers do not like Sprint. This is a fact. Look at Sprint's facebook and then read the comments under their posts. Then look at the other big 3 carriers and read the comments.

11. Doakie

Posts: 2478; Member since: May 06, 2009

I highly disagree. Last year I had a Sprint phone as my personal line and a T-Mobile phone as my work line. As I've traveled around the country Sprint provided horrible coverage in Anaheim, Honolulu, and Seattle my hometown. In Anaheim inside Disneyland I was roaming on Sprint and had a 20 Mbps HSPA+ connection on T-Mobile. Then Honolulu in Waikiki Sprint had 0-1 bar of 3G coverage which had actually zero data connection speed tests would just error out, obviously no LTE; T-Mobile had a 25 Mbps LTE connection. In Seattle Sprint had a 3G network that gave 50-200 Kbps downloads and spotty LTE that gave 2 Mbps downloads; T-Mobile has a 25 Mbps HSPA+ download speed and a 35 Mbps LTE download speed. I can't forget to mention when I have been on T-Mobiles 2G EDGE network I had download speeds of 200 Kbps. That's the same speed that Sprint had on 3G EVDO in Seattle a major metropolitan area. Of course 200 Kbps is better than what I saw in Honolulu of Anaheim. Needless to say we don't have Sprint anymore....

14. Landmarkcm

Posts: 507; Member since: Aug 11, 2009

You are joking right. Sprint have way better 3G/4G coverage. LOL. I'm not on either of the two networks right now but where I am in Vegas, Sprint 3g is still Horrible like dial up and pretty useless. I will take HSPA+ any day! You are correct in your point that in certain areas outside of the major cities Tmobile does need to step up their Edge to HSPA+ still. Overall though & where it counts most Tmobile's speeds and coverage are better.

47. JEverettnow

Posts: 228; Member since: Mar 11, 2013

My 4g in Vegas was decent. I just got back 5 days ago.

6. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

Sprint basically has neglible value -- no real assets, a crap quality network, a dysfunctional and idiotic executive team, and a lot of debt. I can't see why anyone would buy them unless it was for a cut rate discount price. Too bad that playboy from Japan bought the wrong telecom. All those billions could have done something amazing for T-Mobile. But all they did for Sprint was plug a few of the many leaks in the bottom of the boat. It will take many more billions to plug the rest of the leaks and stop Sprint from sinking.

8. lsutigers

Posts: 832; Member since: Mar 08, 2009

You can't exactly make much headway in less than a year, it takes several years. Whichever way this merger plays out, I think Softbank / Son will improve Sprint. The network has already seen huge improvements and Spark is a step in the right direction with average data speeds ~40-70mbps currently and double that by mid / late 2015. With or without TMO, it takes time to rebuild a network and make significant positive changes.

9. 0xFFFF

Posts: 3806; Member since: Apr 16, 2014

If this was the case, Sprint should be focusing on getting their own house in order, i.e. fixing problems and making things better. Instead, they are out shopping with Son's credit card, looking to swallow up T-Mobile. Trying to buy T-Mobile is not the action of a company that has any plan to build something better. This the action of a company who knows if they have greater market power, they can charge their customers more. Basically Softbank realizes they made a bad investment and is looking for alternative strategies to succeed in the US market.

10. Gawain

Posts: 437; Member since: Apr 15, 2010

I need to check the moon and stars, but I totally agree with this point.

18. Slammer

Posts: 1515; Member since: Jun 03, 2010

Not entirely true 0xFFFF. Sprint is totally aware of its shortcomings and Masayoshi Son is a billionaire that doesn't get to where he is by just throwing his money around. Sprint does have considerable assets and a dynamic finacial plan that has finally put them in a revenue gain rather than a loss. Tmobile's plans as of current moves, have been to upset the industry, but it is coming at an extreme loss for the company with no plan on how to overcome this loss with the type of clientele it is attracting. As I explained in another post. What works best? A company making money purchasing a company losing money? Or the other way around? I sense that you would understand this when looked at it properly. John B.

48. JEverettnow

Posts: 228; Member since: Mar 11, 2013

Sprint's profit come from massive layoffs and cutbacks, not from ethical customer gain.

12. Doakie

Posts: 2478; Member since: May 06, 2009

I was a Sprint customer for 11 years. I got tired of all their promises of "We'll get better and have a super fast network! " All their promises are empty and all their claims are lies. Their coverage map is a lie; I moved many times while I had Sprint and none of the places I lived had real world service that matched their coverage map. It would say excellent coverage and it would have 2 bars. It would say good but in reality I was with no coverage. The best speeds I've ever seen with Sprint was on their WiMAX network and I saw 8 Mbps, their LTE network the best I had seen was 2 Mbps. That's a joke. Anyone who claims to have great speeds on their Sprint phone I'd seriously like to see screenshots before I believe you. Sorry.

13. joe1blue

Posts: 169; Member since: Jul 25, 2013

When I was with sprint I had to use an altered prl which allowed me to force roam onto versions network, I quickly got a letter in the mail from sprint telling me that my contact will be terminated in 30 days, like I cared, they broke the contract so I wouldn't have to pay the ETF. Long story short I had no choice but to go to those measures in order to watch a simple youtube video. Now I'm with T-Mobile and I seriously hope this merger doesn't happen.

23. Slammer

Posts: 1515; Member since: Jun 03, 2010

---"When I was with sprint I had to use an altered prl which allowed me to force roam onto versions network, I quickly got a letter in the mail from sprint telling me that my contact will be terminated in 30 days"--- Yes. Because no carrier wants to pay extra for a customer's negligence. Carriers pay for and offer the roaming option for its customers that need it; not abuse it. Thanks to people like you, most carriers have eliminated that option to choose the other carrier as a default. If you roam more than 50 percent of the time or abuse your contractual rights, every carrier has the right to terminate your contract. Including T-mobile. John B.

25. Topcat488

Posts: 1415; Member since: Sep 29, 2012

Forget about sprint & T-Mobile they both are ripping off the consumer. I left them for "Cricket" Wireless... Better Coverage and cheaper, "ME" so happy now... O.o

26. joe1blue

Posts: 169; Member since: Jul 25, 2013

To be honest if sprint would have offered the ability to use wifi calling then I wouldn't have to force roam onto versions network. I live in south Florida where on there coverage map it looks like I'm in one sprints stronger markets, but that wasn't the case if I cant make a call from my home or be on the phone without the call dropping then they should give people the option to leave especially if they know the network is down 90% of the time. I would constantly miss important calls my phone would never ring and I was in a sprint 4G LTE market, my friends would often ask me why do I pay a bill if I couldn't even get service so my only option was ti force roam and I dont feel bad about it. Sprint sucks I was with them for 7 years and 2013-2014 was when there network went to crap on everyone I know.

40. diyi75

Posts: 72; Member since: Oct 30, 2013

And no one should pay for crappy service to have to resort to tricks to have a functioning product. Sounds to me that letter brought good news!

19. TheRequiem

Posts: 245; Member since: Mar 23, 2012

Doakie, no one takes your seriously, your extremely bitter and biased, not sure why yuo need to comment on every single Sprint post... it gets old.

Latest Stories

This copy is for your personal, non-commercial use only. You can order presentation-ready copies for distribution to your colleagues, clients or customers at https://www.parsintl.com/phonearena or use the Reprints & Permissions tool that appears at the bottom of each web page. Visit https://www.parsintl.com/ for samples and additional information.