As reported by various outlets last week, it was expected that Softbank and Deutsche Telekom will probably announce that they have given up trying to reach an agreement to merge their US carriers, T-Mobile and Sprint, respectively. Well, that day has arrived as both have released official announcements confirming that they are not pushing through with their merger discussions anymore. This isn’t the first time that attempts to put the two companies together have failed but this latest one has been going on for months until both parent companies decided they will be unable to reach a mutually satisfying deal.
According to T-Mobile CEO John Legere, while there were compelling reasons for the two carriers to merge, their priority is to bring “superior long-term value” for the shareholders of the company. Moving forward, they will be continuing their “un-carrier” moves and their goal to disrupt the industry in order to drive “significant changes” in the wireless sector. Sprint President and CEO Marcelo Claure said they recognized the “benefits of scale through a potential combination” but they have decided to “move forward on our own.”
Should the merger between the 3rd and 4th largest carriers have pushed through, they could have had 130 million subscribers, which is still 3rd behind Verizon and AT&T. That was actually one of the reasons why they were negotiating in the first place, to combine their powers in order to properly challenge the big two. Unfortunately, they were unable to reach an agreement that was satisfying to both sets of shareholders.
The good news for consumers is that this means that wireless prices will remain low and possibly even lower as all four will battle it out to get new consumers and to convince those signed up with competitors to transfer to them.