Update: Sprint and T-Mobile have prevailed in court over the lawsuit brought by multiple attorneys general. The last hurdle before the merger can be finalized will be receiving the blessing from California’s utility board.
Sprint stock is up more than 70% and T-Mobile stock is up more than 11% on the news.
When the US airline industry shrank to 3 major network carriers they started copying each other’s devaluations and price hikes at a dizzying speed.
Consumers will likely wind up paying a lot more for 5G service with just 3 national carriers.
Originally posted on 7/26/19:
Last April I wrote my thoughts on the proposed Sprint-T-Mobile merger.
The FCC signed off on the deal in May and the DOJ has now signed off on it as well.
In return Sprint and T-Mobile will sell some wireless spectrum to Dish. But it will be nearly impossible for a small startup to succeed in a market with 3 massive competitors.
There are some loose ends and lawsuits to tie up, but with FCC and DOJ support the merger will go through.
Sprint and T-Mobile have kept AT&T and Verizon honest with their more affordable pricing and unlimited data plans. As a combined company that is nearly the same size as AT&T and Verizon there will be less need to compete on price. Upcoming 5G pricing will certainly be higher with less competition in the market.
We’ve seen how poorly consumers have fared in the face of massive hotel and airline mergers. Expect the same to come to the wireless industry.
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42 Comments On "Sprint And T-Mobile Receive Judicial And Regulatory Approval To Merge"
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Oh man that sucks
and all us customers lose
Good thing I got in on the kickstart line!!! 20 dollars. We’ll see how much longer that lasts
How will they deal with 2 technologies CDMA and GSM?
CDMA and GSM are both being phased out. CDMA faster. VoLTE is the baseline.
Dan, I completely disagree with at least the short term (2-3-4 year) outlook on the TMo/Sprint merger.
John Legere, CEO of T-Mobile, has been relentless in dropping costs, providing alternative plans for seniors and military that are cheap, providing all in family plans (4 devices for $100) over the last decade that has dramatically reduced costs across all major (ATT/Verizon) and minor (Boost, Cricket, VMNO) providers. He’s also the reason why Netflix and other streaming services are now becoming more baked into plans to begin with. I.e. TMobile Tuesdays and ATT’s cheap DirecTV Now plan for Unlimited Data Plans.
I don’t disagree with the general 200+ year old American reality that mergers means less competition – and we see that in markets where there are no alternatives for goods and services, such as with Cable and Internet in households.
I think John Legere will double down and continue to target and undercut ATT and Verizon’s rates to capture their market share. TMo was/is #3 today when they weren’t 10 years ago for that exact reason.
It’s unfair to basically take an emotional approach to this topic without looking at the history of TMo as a company.
T-Mobile has needed that strategy as they were less than half the size of the big guys.
Sure, they may not change for the next couple of years. But Mr Legere won’t be there forever and when they are as big as the other competition there is no need to undercut.
Why will this be any different than the airline industry or any other merged industry? Just look at Southwest’s pricing today after buying Airtran and becoming one of the biggest US carriers. Certainly no longer a low cost leader.
Agree 100%. Tired of listening to Legere constantly telling the public WE would benefit from the merger and warn us of the danger if it wasn’t approved. No good will come of this.
Can you point me to the $100 family plan? We are on the older plan for $120 for four smartphones, about $134 after taxes. Their new plans I’ve looked at come out at $40 a line including taxes, resulting in $160 a month so I haven’t switched. What am I missing?
It’s a grandfathered plan, you can’t get it anymore
“John Legere, CEO of T-Mobile”
Last I heard, he’s leaving the company in April.
https://www.t-mobile.com/news/mike-sievert-to-succeed-john-legere
Mike Sievert to Succeed John Legere as CEO of T-Mobile on May 1, 2020
Mike Sievert is committed to the successful Un-carrier strategy, demonstrating that T-Mobile will remain a disruptive force in US wireless marketplace to benefit consumers
I completely disagree with you. First of all, do we not remember not to long ago when they said Walmart was too big to compete with and then came Amazon and absolutely dominanted them. You can never say a company is too big too compete with. You never know what small unheard of start up gains traction for what ever reason and becomes the next big carrier, or maybe a billion dollar company will decide to get into the cell phone carrier industry. Secondly according to your logic that this makes start ups impossible, are you suggesting that Sprint and T-Mobile weren’t so big that a start up could compete with them prior to the merger, they both are billion dollar companies. Third, for sprint customers this may be fantastic, this may mean sprint customers will now be on TMobile’s network (which is a lot better).
Lots of disagreement here.
Monopolies and Oligopalies are generally bad for consumers.
Neoliberal economics is generally bad for consumers.
Go google “tmobile-sprint-merger-doj-trump-dish-wireless-prices-competition” for one take.
> You never know what small unheard of start up gains traction for what ever reason
Although that actually hasn’t happened in a long while (T-Mobile was founded in 1999). The subscriber base of the #5 competitor (U.S. Cellular) is a paltry 5 million, an order of magnitude less than Sprint’s. Disregarding C Spire Wireless and Sprint-affiliate Shentel, no other current US provider has even a third of a million customers.
> according to your logic that this makes start ups impossible
That leap of logic on your part escapes me. I note that the barriers to entry in this market (notably capital requirements to build out a network) are very high. Many of us have only one or two choices for our residential ISP. Many of us feel that oligopoly hasn’t worked out well for us.
> for sprint customers this may be fantastic, this may mean sprint customers will now be on TMobile’s network
Sprint customers do not need the merger to switch to T-Mobile.
Been T-Mobile customer since 2001. Since their voice stream days. I love T-Mobile but I am not for sprint any the merger. If history is to be looked at. Company merging means big devaluation of benefits service for customers! If T-Mobile doesn’t remain ahead of Verizon and at&t, I will switch
Since I opened a company I was very surprised how much cheaper different services if you are a business. Verizon offers unlimited everything (high speed data) for $25 a line to businesses – way cheaper than personal, and there are many other services that do this as well.
Wonder if all sprint towers will become a tmobile tower, which would finally give T-mobile service for all the weak spots and spotty spots outside of NYC(which tmobile is at its best.)
It would be interesting to know how many landlords will be hurt by this. Sprint and T-Mobile currently pay to have cell antennas on buildings and many buildings have both. they may start opting out of many contracts as the towers would be redundant
Don’t worry too much about the landlords and the tower companies! 5G will require a MUCH higher density of base stations than 4G needs. Way way way more.
We have a tmobile tower on our building in jersey and were told that there is talk of a city contract and small 5g towers will be installed on street light polls
How will MVNOs be affected by this? I love my Tello plan.
when the merge is finally completed will i be able to use phones that only work on tmobile but would not work on sprint like certain unlocked phones?
plus 1 if i am a sprint customer can i now use certain unlocked phones that would only work with tmobile?like certain unlocked gsm phones
I think in USA internet, cell phones plan so expensive ever from all the world.
By erupe, Israel for 20$ € you get much more from 75$ here.. By the end not real competition.
Israel is a tiny country… So in terms of investment almost nothing compared to US
In Israel the market was out of control till Golan Telecom came in and killed it. Maybe Dish having all the small companies will actually help them compete with the big boys.
Is there any way that this decision gets reversed, or is it a done deal?? Is there a way appeal it?
I am not sure how long there would be four companies for because I believe that as sprint loses market share they are lowering service quality, thus losing more market share making an eventual bankruptcy likely
I hate sprint !
I’m on the 1yr free with sprint. Service is great in many areas but really sucks in other places
I actually felt the same but I’ve come around to the view that Dish might actually be a very strong competitor… they will have some beauty spectrum to build out their Network all new 5g/4g w/o dealing w legacy 2g/3g garbage… They will do what TMobile did to the rest of em a few short years ago after failed at&t merger
The truth is sprint was never much of a competitor.. the merger is about buying sprint spectrum rights & costumer base. And sprint needed this or else they would go bankrupt… So either way ur left w 3 Networks (not counting dish ; ). Much better for sprint employees.. where at least a decent amount keep their jobs post merger. Also for consumers who get better service and coverage.
From michaelgeist.ca this month.
What is wrong with competition in the Canadian, Japanese and US markets?
Gigabyte prices in the Canadian, Japanese and US markets are a universe apart from prices in 4-MNO competitive large European markets or from the ultra-competitive Israeli 5-MNO market.
The median smartphone plan gigabyte price in Canada was 24 times higher while in Japan and the US was 15 times higher than median prices in 4-MNO competitive large European markets.
@dan how will this effect Google Fi?
Wow. Nice profit for the Sprint stock holders.
Goodbye Uncarrier.
Once the merger is complete, Legere is moving on –
I’ve made out like a bandit with T-mobile BOGO’s (MCGC -cash out at WF) and Costco over the years.
Agreed that M&A only benefits C-Suite executives and the shareholders – the customers and employees get the raw end of the deal most of the time.
At least T-Mo didn’t merge or team up with Comcast – about the only silver lining on this cloud.
If you really “made out like a bandit” why didn’t you use some of that gelt and buy a couple of vowels?
Really bad news – just signed up for a Sprint Mvno Hellomobile 10.00 a month wonder when that’ll end…
Is it really $10/month, or just $10 for the first month? I nearly got tricked into signing up a few weeks ago until I looked at the fine print.
I reluctantly transitioned to the Tmobile 2GB, unlimited text and call years ago but I am going to keep it until I will be forced to change it. $90 + taxes for four lines. With Tmobile since 2003.
It’s sad, I have T-mob plan for 4 about 120$, from 2010, unlimited calls, And mes+ internet All over Europe and most countries of the world
Generally I would be against this merger, but both Tmobile and Sprint have always been unusable for me. Perhaps after combining their spectrum and overhead they can finally offer reliable service. Right now Verizon has no real competition (and is not that good either), merging these companies makes competition possible now.