After a lot of stop-and-go, it is starting to sound like T-Mobile is preparing for a successful merger with Sprint.
If you’ll recall, back in November of last year T-Mobile and Sprint officially called off talks of a merger. While several different variables led to that decision, even after so many years of working towards that goal, what it ultimately came down to that time was T-Mobile’s position had improved since the first (or second) time that the two companies discussed the merger. Sprint wasn’t on board at the time, but that position didn’t last very long.
Fast forward to April of this year and talks came back in full swing. And while there was an initial rumor that the two wireless carriers were gearing up to get back into the negotiation room, it would take only a few days before it became officially official. T-Mobile’s CEO, John Legere, said then that the merger would lead to even more competition in the wireless market, among other benefits he sees with the combination of the two companies.
Now, as November and 2018 wind to a close, T-Mobile is confident that the merger will be finalized and approved by the final battery of tests in the early stages of 2019. The wireless carrier’s Chief Financial Officer, J. Braxton Carter, could close as early as the first quarter — but it may be finalized in the second quarter, too. At this stage, the proposed merger is still being weighed by the Department of Justice and the FCC.
“The only remaining thing that is happening is depositions with the DoJ, which have started and will be completed in a few weeks.”
Carter says that the merger needs to be successful if the companies want to continue to take on the market leaders in the wireless industry in the United States, AT&T and Verizon. The merger would allow for the new entity to create 8 times the 5G capacity that either company could do on their own. And while that may be true, the question of available competition and current wireless network prices is the real key here.
As noted above, Legere believes that competition will actually improve in the United States if the magenta un-carrier is able to merge with Sprint. However, that would reduce the number of major wireless networks in the U.S. from four to three. And it would put a major shift on a variety of different prepaid wireless networks that both carriers offer. That’s certainly one of many facets that the DOJ and FCC are weighing as they move forward with deliberations over the planned merger.