Feature Article

June 25, 2014

T-Mobile & Sprint: The Plus and Minus

There is a lot of signal-to-noise ratio on the ATT and DirecTV merger. Anytime AT&T attempts to do anything, the pre-1982 antitrust voices take over and make it sound like no other network in the world exists.

In comparison, the world is relatively calm about the merger of T-Mobile to Sprint.

One aspect of the merger I like is that it marries two international carrier holdings into one with Softbank and DT sharing ownership.  When it comes to roaming, my experience is having an international owner benefits the world traveler.

Personally I am in favor of these mergers, so don’t expect this to be a rant about monopolies. However, the merger should not go forward without some discussion about implications.

From a regulatory perspective a stronger number three is good for consumers.

When you merge Sprint with T-Mobile, you also converge most low-cost brands; Boost Mobile, MetroPCS, Virgin Mobile, etc.

This means that the low-end buying power is consolidating in one spot.  This is somewhat of a concern because it has a tendency to make them all look alike. It also begs the question: Should the low-cost brands consolidate?

If the low cost brands are aggregated like this, what does it mean for MVNOs?   For example does TracFone’s Straight Talk wireless find it easier to manage their contracts with the network operators?

Another consideration: Will the Regional Wireless Operators such as Cellcom, CellularOne, ShenTel, US Cellular and Vtel find themselves having to rethink their relationships? Right now, many of them are affiliated with the larger carriers, but perhaps the regionals will need to distinguish themselves as the three nationals become more entrenched in their roles.

So these were the concerns, but on the plus side, I think T-Mobile and Sprint combined represent a better alternative and reduces market power for the other two.

I have been a customer to all of them, and know they all have their plus and minus. However, at the end of the day, the stronger the networks the better the competition.




Edited by Rory J. Thompson


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