T-Mobile's parent company rumored to be in talks for merging it with Metro PCS

T-Mobile's parent company rumored to be in talks for merging it with Metro PCS
Deutsche Telekom, whose subsidiary is T-Mobile USA, is rumored to be in advanced talks for acquiring MetroPCS, and merging it with T-Mobile, after the merger with AT&T didn't go down well with the FCC.

MetroPCS was the first to offer an LTE network and an LTE phone, and, despite its limited footprint, that must count for something in DT's eyes. The main reason, however, might be MetroPCS's 9 million customers, which will limit the outflow damage that T-Mobile sustained in Q4 2011, for example, after it became clear it won't be carrying the iPhone.

T-Mobile is the only one of the big four US carriers whose eventual LTE network is not already launched or about to be operational, but Metro PCS' AWS spectrum is not really that valuable for it, since it doesn't hold much to begin with. Moreover, MetroPCS is a CDMA carrier, incompatible with the GSM tech of T-Mobile, and its LTE service is pretty slow, compared to Verizon or AT&T.

Deutsche Telekom is looking at it from an entirely business perspective, though - after the failed $39 billion merger with AT&T, they want to bulk up T-Mobile, make it more attractive for investors, and spin it off in an IPO, or in an outright sale, analysts say.

source: Bloomberg

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9 Comments

1. snowgator

Posts: 3621; Member since: Jan 19, 2011

I guess they were not paying attention to the problems Sprint had with incompatible tech. They are still trying to dig for air from the Nextal purchase. Strange thinking. Do not see how this adds value to either company. Sprints board may really regret not grabbing Metro PCS. Maybe a merger with U.S. Celluar would work for Metro, who seems to be really shopping itself?

2. remixfa

Posts: 14605; Member since: Dec 19, 2008

just like the sprint-tmobile rumors.. ill put this under "unlikely" since they are completely incompatible. Sprint trying to merge with metro.. maybe. Tmobile? What would be the point. 9 million subscribers that dont work on the network? no thanks.

3. dcgore

Posts: 234; Member since: Feb 24, 2012

I think Deutsche Telekom is missing on a great opportunity to set presence in the US as T-mobile, not as an unit of it but as an extension of it. Why not throw the european muscle behind it and make it a part of the original company? For instance, it would be amazing if one could go to Europe and pay zero for roaming fees or having to have an international plan, it's just tmobile after all. The world travelers would switch to tmobile in a second knowing that they have service everywhere and there's no extra fees for that coverage. Imagine getting all the European released devices working in the US and getting released at the same time as in Europe which many times is earlier than in the US. That's a business advantage right there vs other US carriers.

4. -box-

Posts: 3991; Member since: Jan 04, 2012

That would be wonderful

7. nyamo

Posts: 274; Member since: Mar 19, 2011

as wonderful as that sounds, DT just doesn't seem to have the motivation to pull something like that off.

5. ps1001

Posts: 65; Member since: Dec 14, 2010

apple should buy t-mo and the new network will be called tappled and should be sole carrier for imobile....

6. taco50

Posts: 5506; Member since: Oct 08, 2009

Looks like T-Mobile is getting desperate.

8. Joshing4fun

Posts: 1245; Member since: Aug 13, 2010

Does Tmobile even need LTE? Couldn't they just enhance hspa and make it even faster? Not sure how that works.

9. vvelez5

Posts: 623; Member since: Jan 29, 2011

Unfortunate that a company has to go through so many loops and red tape just so they can try and get rid of something they dont want. Because the government doesn't want to let capitalism work.

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