AT&T exec doesn’t think Sprint/T-Mobile merger is possible

March 12, 2014
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The Sprint/T-Mobile merger has a lot of interesting nuance. A merger between major US carriers has been attempted before to no success, but the two carriers in question now are less “major”. The FCC is notoriously resistant to having three carriers, but is keeping an “open mind” this time. As for AT&T, they don’t think a Sprint merger with T-Mobile is even possible.

AT&T CMO John Stephens said he doesn’t “think” a merger will happen. When asked if he thought the FCC would allow the merger, Stephens said “it would be surprising”, adding “I don’t think they will”. AT&T has played the T-Mobile merger game before and failed, having lost $1 billion in spectrum and a cool $3 billion fee to T-Mobile for the failed transaction.

Stephens’ comment strike us as doubt cast from their own failure to snap up T-Mobile, but he could just have insight. AT&T has a much better idea as to why their merger failed than anyone else, and discussions with the FCC may have left them feeling as if no merger between major carriers would ever be allowed. Again, the scope of a T-Mobile merger with AT&T would have been massive, while one with Sprint still keeps the new company in last place when it comes to total customers.

For their part, Sofbank (parent company of Sprint) is touting the benefits of a merger. CEO Masayoshi Son is promising a war on all fronts — including pricing and technology — should the merger happen. He wants to disrupt both AT&T and Verizon by offering customers value. A new company would also have the scale to do that, whereas separately neither Sprint nor T-Mobile do. Good for us, bad for the status quo. Sounds like something we could get behind, even if AT&T doesn't believe it's possible.


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