Sprint primed for acquisitions

[bigsnake49]

Sprint Nextel Corp.’s (S) stock has more than doubled this year and its cash is near a six-year high, paving the way for an acquisition that could strengthen its efforts to challenge AT&T (T) Inc. and Verizon Wireless.

Sprint’s stock surged 136 percent for the second-biggest gain in the Standard & Poor’s 500 Index as the wireless provider boosted sales with Apple Inc.’s iPhone and began rolling out a faster network. Cash and equivalents stand at almost 6.8 billion after reaching the highest this year since the end of 2005, the year it bought Nextel Communications Inc., according to data compiled by Bloomberg. While the carrier’s debt exceeds its 16.6 billion market value, the stock gain bolsters its currency for a deal, Gabelli & Co. said.

 

The 36 billion Nextel takeover, intended to create a stronger No. 3 player, instead left Sprint with incompatible networks, fleeing subscribers and five years of losses. With Sprint now showing signs of improvement, Gabelli said the company could expand its customer base by acquiring a smaller rival such as MetroPCS Communications Inc. (PCS) or Leap Wireless International Inc. A combination with T-Mobile USA, the fourth- biggest provider, would create a carrier with the size to challenge AT&T and Verizon Wireless, Macquarie Group Ltd. said.

 

http://www.bloomberg.com/news/2012-09-26/sprint-primed-for-takeovers-after-stock-jumps-real-m-a.html

 

Nothing really new here and we have talked about it here before. I think that Leap would be the first one to be absorbed, then Metro. Sprint can then trade their AWS spectrum with the AWS gang for 1900PCS spectrum particularly adjacent to their holdings. I just don't see the FCC or FTC allowing them to absorb T-Mobile. I still don't know about USCC. I would like for Sprint to acquire them, then sell the 850MHz and AWS spectrum to AT&T or Verizon and obtain either 1900PCS spectrum, or roaming rights or both.

[Feech]

I don't claim to know anything about spectrum, but I really wished that Alltel and Sprint had hooked up back in the day.

[jefbal99]

I think Sprint needs to have the spectrum swaps all setup and ready to go before any acquisitions occur. We don't want another Nextel type situation where we are stuck with incompatible networks and spectrum.

 

Better planning needs to occur...

[S4GRU]

I just don't see the FCC or FTC allowing them to absorb T-Mobile. I still don't know about USCC. I would like for Sprint to acquire them' date=' then sell the 850MHz and AWS spectrum to AT&T or Verizon and obtain either 1900PCS spectrum, or roaming rights or both.[/quote']

 

Really? I think a Sprint/Tmo deal could pass, because it could be framed to actually increase competition. However, I think Tmo is just large enough that it makes it very difficult for Sprint to be able to swallow it whole. Lots of money.

 

USCC is a better target. However, that would be very difficult to pull off too. I think that is why Sprint keeps pursuing the bottom feeding prepaids. Because it has the resources to pull something like that off.

 

Robert via CM9 Kindle Fire using Forum Runner

[jefbal99]

I don't claim to know anything about spectrum, but I really wished that Alltel and Sprint had hooked up back in the day.

 

I remember reading an article that Alltel tried to buy Sprint, but Sprint turned them down, wanting to go it alone. An Alltel/Sprint partnership with Nextel's SMR spectrum would be a beast. Think about all the rural towers that Alltel had PCS coverage on, then adding SMR to that.

[jefbal99]

Really? I think a Sprint/Tmo deal could pass, because it could be framed to actually increase competition. However, I think Tmo is just large enough that it makes it very difficult for Sprint to be able to swallow it whole. Lots of money.

 

USCC is a better target. However, that would be very difficult to pull off too. I think that is why Sprint keeps pursuing the bottom feeding prepaids. Because it has the resources to pull something like that off.

 

Robert via CM9 Kindle Fire using Forum Runner

 

Any Sprint/TMo deal would probably require new entitiy to divest the AWS coverage. Hopefully they could get back PCS from AT&T/Verizon for the AWS.

[S4GRU]

 

I remember reading an article that Alltel tried to buy Sprint' date=' but Sprint turned them down, wanting to go it alone. An Alltel/Sprint partnership with Nextel's SMR spectrum would be a beast. Think about all the rural towers that Alltel had PCS coverage on, then adding SMR to that.[/quote']

 

Alltel already had Cellular 850 on them, which Sprint devices already support. So it would have been a beautiful thing.

 

Sprint was interested in Alltel when Verizon jumped in and scooped them up. And AT&T snagged the divested portion. They intentionally were trying to keep it out of Sprint hands. A Sprint/Alltel combo was something the big two were worried about for a long time.

 

Robert via CM9 Kindle Fire using Forum Runner

[irev210]

Sprint + Alltel would have been great. It's really too bad.

 

 

At any rate, Robert and AJ will love this:

http://www.bloomberg.com/video/sprint-liquidity-doesn-t-fix-company-moffett-says-vGbPOGMwTleVu56hYiEYnw.html

 

He is at it again. He continues to sound as stupid as ever. It's sad.

[bigsnake49]

It was that stupid nincompoop Forsee that rejected Alltel's advances. Alltel had very low debt and was run very well. Sprint would have gained instant credibility as a true nationwide provider, particularly if they also went into an alliance with USCC to the point where USCC's coverage appeared as native. Nextel would have been icing on the cake giving them 800MHz in the sticks and the cities along with PCS block H. Or they could have waited and bid on 700MHz.

[bigsnake49]

Sprint + Alltel would have been great. It's really too bad.

 

 

At any rate, Robert and AJ will love this:

http://www.bloomberg...u56hYiEYnw.html

 

He is at it again. He continues to sound as stupid as ever. It's sad.

 

Moffett is a total idiot. So is Entner!

[bigsnake49]

Really? I think a Sprint/Tmo deal could pass, because it could be framed to actually increase competition. However, I think Tmo is just large enough that it makes it very difficult for Sprint to be able to swallow it whole. Lots of money.

 

USCC is a better target. However, that would be very difficult to pull off too. I think that is why Sprint keeps pursuing the bottom feeding prepaids. Because it has the resources to pull something like that off.

 

Robert via CM9 Kindle Fire using Forum Runner

 

T-Mobile would be a nightmare to integrate. They would almost have to run them as separate companies until they converge on LTE. If they want to buy T-Mobile, they will have to do it before T-Mobile starts LTE on AWS. Otherwise Sprint would have to support LTE on EBS/BRS, PCS, AWS and SMR spectrum. Not to mention voice. USCC, Metro and Leap much simpler and cleaner. Sprint rejected simpler and cleaner with Alltel and instead went for complicated and look how long it took them to get out of that mess.

[S4GRU]

 

T-Mobile would be a nightmare to integrate. They would almost have to run them as separate companies until they converge on LTE. If they want to buy T-Mobile' date=' they will have to do it before T-Mobile starts LTE on AWS. Otherwise Sprint would have to support LTE on EBS/BRS, PCS, AWS and SMR spectrum. Not to mention voice. USCC, Metro and Leap much simpler and cleaner. Sprint rejected simpler and cleaner with Alltel and instead went for complicated and look how long it took them to get out of that mess.[/quote']

 

Agreed. I didn't mean it to sound like I endorse a Sprint/Tmo deal.

 

Robert via CM9 Kindle Fire using Forum Runner

[jefbal99]

Alltel already had Cellular 850 on them, which Sprint devices already support. So it would have been a beautiful thing.

 

Sprint was interested in Alltel when Verizon jumped in and scooped them up. And AT&T snagged the divested portion. They intentionally were trying to keep it out of Sprint hands. A Sprint/Alltel combo was something the big two were worried about for a long time.

 

Robert via CM9 Kindle Fire using Forum Runner

 

I always thought Alltell was PCS only, I didn't realize they were 850Mhz cellular. Makes sense, however, when I was using their towers, I wasn't this informed. The knowledge I've gained from this website and its members is truly amazing

[jefbal99]

T-Mobile would be a nightmare to integrate. They would almost have to run them as separate companies until they converge on LTE. If they want to buy T-Mobile, they will have to do it before T-Mobile starts LTE on AWS. Otherwise Sprint would have to support LTE on EBS/BRS, PCS, AWS and SMR spectrum. Not to mention voice. USCC, Metro and Leap much simpler and cleaner. Sprint rejected simpler and cleaner with Alltel and instead went for complicated and look how long it took them to get out of that mess.

 

Only way Sprint could make T-mobile work is to take a huge hit and just replace all their phones then use the Spectrum... For the most part, Sprint and T-Mobile offer the same devices, Sprint just have to offer straight swaps (but with a new 2yr contract). Then work the tower conversion as fast as possible.

[S4GRU]

Sprint + Alltel would have been great. It's really too bad.

 

At any rate' date=' Robert and AJ will love this:

http://www.bloomberg.com/video/sprint-liquidity-doesn-t-fix-company-moffett-says-vGbPOGMwTleVu56hYiEYnw.html

 

He is at it again. He continues to sound as stupid as ever. It's sad.[/quote']

 

Holy moly! I watched that in bed on my Kindle Fire while drinking my first morning cup of coffee, and my wife started arguing with Craig's stupidity. My wife! She is better educated about Sprint and the markets than Craig Moffett, and she doesn't follow this stuff.

 

His comments about Sprint taking years to catch up and never be able to provide a useful LTE network because it is using "high frequencies" are ridiculous. He doesn't understand site density at all. Wow, is he going to be surprised when Sprint overtakes AT&T's LTE coverage next year.

 

Also, I find it amazing that he overlooked AT&T's spectrum limitations for LTE. And he talks about AT&T as if they have nationwide 700MHz spectrum, which they do not. And their new Qualcomm spectrum is not even paired. Major oversight on Moffett's part to blast Sprint's spectrum related to LTE and praising AT&T, even though they are in a worse position all things considered. What a dipshit.

 

Robert via CM9 Kindle Fire using Forum Runner

[bigsnake49]

Holy moly! I watched that in bed on my Kindle Fire while drinking my first morning cup of coffee, and my wife started arguing with Craig's stupidity. My wife! She is better educated about Sprint and the markets than Craig Moffett, and she doesn't follow this stuff.

 

His comments about Sprint taking years to catch up and never be able to provide a useful LTE network because it is using "high frequencies" are ridiculous. He doesn't understand site density at all. Wow, is he going to be surprised when Sprint overtakes AT&T's LTE coverage next year.

 

Also, I find it amazing that he overlooked AT&T's spectrum limitations for LTE. And he talks about AT&T as if they have nationwide 700MHz spectrum, which they do not. And their new Qualcomm spectrum is not even paired. Major oversight on Moffett's part to blast Sprint's spectrum related to LTE and praising AT&T, even though they are in a worse position all things considered. What a dipshit.

 

Robert via CM9 Kindle Fire using Forum Runner

 

Craig Moffett and Roger Entner are just blithering idiots that sound informed to the uninformed. The one eyed, myopic mentally challenged leading the blind.

[jefbal99]

It was that stupid nincompoop Forsee that rejected Alltel's advances. Alltel had very low debt and was run very well. Sprint would have gained instant credibility as a true nationwide provider, particularly if they also went into an alliance with USCC to the point where USCC's coverage appeared as native. Nextel would have been icing on the cake giving them 800MHz in the sticks and the cities along with PCS block H. Or they could have waited and bid on 700MHz.

 

I think Alltel would have bought Sprint, more than a merger or Sprint buying Alltel. At the time, what were Alltel's spectrum licenses? Were they just 850Mhz cellular or did they have PCS licenses they were using too? I remember that I had some family that used Alltel and they raved about the service/support/devices.

[S4GRU]

 

I think Alltel would have bought Sprint' date=' more than a merger or Sprint buying Alltel. At the time, what were Alltel's spectrum licenses? Were they just 850Mhz cellular or did they have PCS licenses they were using too? I remember that I had some family that used Alltel and they raved about the service/support/devices.[/quote']

 

The Alltel network was the best in Northern New Mexico, bar none. But their smartphone selection wasn't stellar.

 

Alltel only used Cellular around here, AFAIK.

 

Robert via CM9 Kindle Fire using Forum Runner

[bigsnake49]

I think Alltel would have bought Sprint, more than a merger or Sprint buying Alltel. At the time, what were Alltel's spectrum licenses? Were they just 850Mhz cellular or did they have PCS licenses they were using too? I remember that I had some family that used Alltel and they raved about the service/support/devices.

 

They had both. For example in Jacksonville, FL they had 1900. I think that Alltel was aiming for a merger not a buyout of Sprint. According to the former Alltel CEO Scott Ford, they approached Sprint 3-4 times about a merger and they were turned down each time. Scott would have probably been the CEO. Here's a map of Alltel's 1900MHz holdings:

 

http://people.ku.edu...alltel_pcs.html

 

Here is a link to their 850Mhz holdings by region:

 

http://people.ku.edu/~cinema/wireless/regions.html

Edited September 26, 2012 by bigsnake49

[WiWavelength]

They had both. For example in Jacksonville, FL they had 1900.

 

True, both. But Alltel had very little PCS 1900 MHz spectrum. Jacksonville was its largest PCS market, and by all reports, it was a red headed step child. Alltel had PCS ambitions in Atlanta, Memphis, Kansas City, et al., but sold off those PCS D/E block 10 MHz licenses to VZW circa 2000. The other markets off the top of my head where Alltel held PCS spectrum (Wichita, Amarillo, and Liberal, KS) it inherited through acquisition of WWC or divestment from the Cingular-AT&TWS merger. And only Wichita was a purely PCS market. In short, Alltel was an almost exclusively Cellular 850 MHz carrier.

 

AJ

[iansltx]

Count me in as one who really, really wished that Alltel + Sprint would have gone through. It was a natural match...Sprint and Alltel already had reciprocal roaming agreements for voice and data (including 3G)...but all for naught.

 

As for Sprint plus T-Mobile, my guess is that's what we'll see within five years. Quad-band LTE phones aren't so far-fetched (the iPhone 5 A1428 already supports CLR, PCS, AWS and 700-lower-B-and-C, while the A1429 supports CLR, PCS, 700-upper-C and 2100), and a merger would solidify AWS as a "common ground" LTE roaming band since the then-big-3 would all have a lot of spectrum there.

 

There are a few catches of course. First, both companies would want to push for VoLTE ASAP to get off their respective, incompatible 2G/3G technologies. To handle the transition to a merged network, you'd basically have to ignore that the companies were combined for a few years and push quad-band LTE devices with VoLTE out as quickly as possible in the mean time...paying tons of cash to swap everyone's phones out when both companies have just completed their respecitve non-4G modernizations is a bad idea.

 

Also, T-Mobile plus Sprint presents a lot of overlapping footprint issues. You'd end up with a lot of decommissioned cell sites. Many of these would probably be Sprint if the deal was done next year, as T-Mobile has fiber to most of their sites already. You could also end up with a much smaller force on the ground doing network upgrades, due to the lower tower count, but that's okay. Considering how slowly things are going for Sprint at this point, maybe the number of boots on the ground wouldn't decrease after all.

 

In short, a T-Mobile plus Sprint merger would be messy, but since both companies are basing their next-gen strategies on LTE in roughly the same spectrum (AWS vs. PCS...cell spacing isn't much different and T-Mobile's network was built for PCS anyway) it's a lot more doable than Sprint + Nextel (which has effectively no network commonality).

 

Of course, there are several acquisitions that would make a lot more sense before then. Scooping up Leap (who owes Sprint money anyway) or MetroPCS, spinning off their AWS spectrum to T-Mobile and migrating their customers to Boost Mobile (while till using the same phones) would be a relatively straightforward task, and T-Mobile would be happy to pay a good bit of money or the extra AWS to subsidize the deal. Sprint could then cherry-pick any good cell site locations, upgrading those to NV (in MetroPCS's case the equipment is already there, but the backhaul might not be, and the equipment might be the wrong vendor for a given region) and shuttering the others. The bits of PCS spectrum each of the two carriers have could be added to Sprint's holdings to increase the amount of LTE capacity available to every LTE-capable Sprint phone.

 

CricKet and MetroPCS customers wouldn't mind any of this as long as they kept the same or better speeds and coverage, and the same or better plan pricing, both of which Sprint can accomodate. Sounds like a straightforward deal to me.

 

As for US Cellular, they seem to be a bit stagnant, have a more rural footprint (but not nearly as big as Alltel) and are deploying LTE across a plethora of bands (700, 850, 1900, AWS). Divesting their 700MHz holdings would probably be the easiest way of dealing with them, but where would those holdings be sold? Their AWS might be too rural for T-Mobile (though it might not be), and their customer base just isn't that large. Better to have them as a seamless roaming partner than to buy them.

[bigsnake49]

As for US Cellular, they seem to be a bit stagnant, have a more rural footprint (but not nearly as big as Alltel) and are deploying LTE across a plethora of bands (700, 850, 1900, AWS). Divesting their 700MHz holdings would probably be the easiest way of dealing with them, but where would those holdings be sold? Their AWS might be too rural for T-Mobile (though it might not be), and their customer base just isn't that large. Better to have them as a seamless roaming partner than to buy them.

 

They have about 6M customers. Not all the AWS is rural. I'm sure that you can find people to buy it.

 

A seamless roaming partner like Alltel that ends up getting acquired by Verizon? No thanks. Sprint has a $1B annual roaming bill. You can build a whole lot of rural sites and absorb USCC for that kind of money.

Edited September 26, 2012 by bigsnake49

[Rawvega]

Sprint + Alltel would have been great. It's really too bad.

 

 

At any rate, Robert and AJ will love this:

http://www.bloomberg...u56hYiEYnw.html

 

He is at it again. He continues to sound as stupid as ever. It's sad.

 

If there is a bigger idiot than Muppet in the telecom analyst space right now, I'd love for someone to point him/her out. I keep thinking that Craig can't possibly be that dumb and time and again he proves me wrong.

 

Either that or he's crazy like a fox trying to make an easy buck shorting the stock...

[iansltx]

If there is a bigger idiot than Muppet in the telecom analyst space right now, I'd love for someone to point him/her out. I keep thinking that Craig can't possibly be that dumb and time and again he proves me wrong.

 

Either that or he's crazy like a fox trying to make an easy buck shorting the stock...

 

I'm going to go with a bit of both. Wouldn't be surprised if he's way long in AT&T, somewhat long on Verizon, and short on everyone else, except maybe cable companies.

[Rawvega]

Yes, he does love his cable companies.