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T-Mobile CFO makes case for U.S. consolidation, Sprint deal


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http://finance.yahoo.com/news/t-mobile-cfo-makes-case-145853608.html

 

NEW YORK (Reuters) - T-Mobile US Inc Chief Financial Officer Braxton Carter said on Wednesday that he expected more consolidation in the U.S. wireless market and made a case for a deal between his company and bigger rival Sprint Corp.

 

Carter declined to say whether T-Mobile US, the No. 4 U.S. mobile provider, and Sprint, the No. 3 U.S. operator, had talked. "It's the logical ultimate combination," Carter told Reuters on the sidelines of the Goldman Sachs Communacopia investor conference in New York.

 

"We think it's not a question of if but when that there's further consolidation in our industry," Carter told the audience.

 

Carter conceded that the current U.S. regulatory environment was "tough" for consolidation as the government already blocked T-Mobile's proposed sale to AT&T Inc in 2011, saying that the market needed four national operators.

 

He said a deal involving the smaller national operators would be good for the industry. He described the U.S. market as a "duopoly" because AT&T and larger rival Verizon Wireless are far bigger than T-Mobile and Sprint.

So if a consolidation resulted in a much bigger No. 3 rival to AT&T and Verizon, "you create a more competitive environment," Carter said.

 

However, such a deal might take time to come together. Carter's comments followed a prediction by No. 2 rival AT&T Inc's chief executive officer, Randall Stephenson, the day before about the unlikelihood of any major mergers here in the next few years because regulators appear to want four major operators.

 

Since it closed its merger with smaller provider MetroPCS in April, T-Mobile US itself has been improving its customer numbers by competing aggressively against AT&T with new consumer offerings and direct marketing.

AT&T's Stephenson had said Tuesday that his company was only affected by the tougher competition from T-Mobile US in the "price-sensitive" part of the market.

 

But on Wednesday T-Mobile Chief Marketing Officer Mike Sievert quipped during his appearance at the conference that "the price-sensitive part of the market is the lower 90 percent."

 

T-Mobile shares were up 2.7 percent at $26.12 on New York Stock Exchange on Wednesday, while Sprint was down 0.5 percent at $6.16.

 

(Reporting by Sinead Carew; Editing by Lisa Von Ahn)

 

 

It's kind of interesting for Carter to be making these kinds of comments at this point in time. I doubt that anything would be forthcoming in the near future, but who knows?

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If a merger happens thatll be 3g cdma,1x800, 4 levels of LTE, hspa+21/42 in most coverage areas...and think of all of the spectrum they would have. Rural coverage less than verizon/att. But for most people it would be a pretty good network.

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If what the government actually wants is 4 strong carriers then what they really need to do is block AT&T and Verizon from buying up these small local carriers.

 

I'm not sure Sprint needs T-Mobile at this point now that it has Softbank. T-Mobile needs more spectrum before they can expand but I am not sure they can AFFORD the capex it would take to substantially expand their network. I see T-Mobile remaining a strictly urban carrier for the foreseable future. Sprint has a long road of expensive retrofitting before it can truly compete with AT&T and Verizon. 

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But how many of those techs/bands could one realistically pack into a handset? And even of you could for a reasonable price, what would the price of battery usage be? IF something like this were to happen, there would have to be a consolidation of network technologies as well I would think.

 

They would have to keep T-Mo's girl for advertising, however or it's no deal. 

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I would personally like to see 4 strong carriers competing for customers instead of 3. If there was only 3 carriers we would be in a similar situation that Canada is in with very expensive plans with extremely low caps. If anything I think the government should allow for sprint and tmo to buy up the smaller regional carriers to compete with the big two.

 

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But how many of those techs/bands could one realistically pack into a handset? And even of you could for a reasonable price, what would the price of battery usage be? IF something like this were to happen, there would have to be a consolidation of network technologies as well I would think.

 

They would have to keep T-Mo's girl for advertising, however or it's no deal.

 

most phones already would support the hspa+ part and it would not be hard to add aws LTE to the mix. And like the person said above the phones can support 13 bands...and battery like is still reasonable. And I know it wont happen because The duopoly would through hissy fits, and make sure it wont happen. And im not sure if sprint would go that route anyway. Would be nice though having that many pathways for data
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If what the government actually wants is 4 strong carriers then what they really need to do is block AT&T and Verizon from buying up these small local carriers.

 

I'm not sure Sprint needs T-Mobile at this point now that it has Softbank. T-Mobile needs more spectrum before they can expand but I am not sure they can AFFORD the capex it would take to substantially expand their network. I see T-Mobile remaining a strictly urban carrier for the foreseable future. Sprint has a long road of expensive retrofitting before it can truly compete with AT&T and Verizon. 

 

T-Mobile has plenty of spectrum for the number of  people they have, but you are right, the capex will kill them, unless they score 600Mhz.

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This has been something that I have been suggesting for a long time and I know that people on the Sprint side have been working on the logistics of making it happen for a long time now.

If the FCC want to have four national operators, then they need to require the Sprint/Tmobile combination to shed at least the EBS spectrum to Dish. Between Sprint and T-Mobile, they will have plenty spectrum. They might even want to require them to host Dish's spectrum.

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In some markets they do not have both, but one or the other.

So keep the one they have. Although they will definitely not need it. Between Sprint and T-Mobile's PCS holdings, T-Mobile's AWS holdings, Sprint's 800MHz, possible PCS H auction winnings and possible lease of Dish's 2000-2020 AWS-2 holdings as a a supplemental downlink, they will have plenty of spectrum. That's not even counting 600MHz

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So keep the one they have. Although they will definitely not need it. Between Sprint and T-Mobile's PCS holdings, T-Mobile's AWS holdings, Sprint's 800MHz, possible PCS H auction winnings and possible lease of Dish's 2000-2020 AWS-2 holdings as a a supplemental downlink, they will have plenty of spectrum. That's not even counting 600MHz

Yeah but once 2500 is built out in a market, it will not be cost effective to divest it. To me, this means that they ate stuck with it unless they can sell Clearwire in its entirety to somebody else for a fair price. To keep it iin some markets and not others would just introduce another bastard frequency/technology that is barely deployed but many devices will have to support, just like WiMAX all over again. Also, do not forget Softbank's compatible network in Japan.

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Yeah but once 2500 is built out in a market, it will not be cost effective to divest it. To me, this means that they ate stuck with it unless they can sell Clearwire in its entirety to somebody else for a fair price. To keep it iin some markets and not others would just introduce another bastard frequency/technology that is barely deployed but many devices will have to support, just like WiMAX all over again. Also, do not forget Softbank's compatible network in Japan.

 

Once it's built they will use it. But they have plenty of BRS in the top 100 markets. They can also buy the rest of it that they do not own from the owners.

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The one downside if this were to happen, would be AT&T and verizon would have just as much a shot at 600 as would the merged company. And I wouldnt be so sure that someone would have to decommission their equipment. It would be beneficial for sprint owners to use hspa+ since it is faster than evdo, and it could be used as a way to offload LTE and such

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I don't really want to see Sprint and Tmobile merge at this point.  Both companies have too much on their plate right now with both companies working on their own Network Vision and expanding LTE.  Tmobile is also in a transition process to shut down the MetroPCS CDMA network as well and refarm PCS spectrum for HSPA+.

 

We need to have both Sprint and Tmobile remain independent and work together while the 600 MHz auction is in talks until the auction is complete.  We need to have 2 out of the 4 major smaller players help establish the rules for the 600 MHz auction and fight for the smaller carriers (US Cellular, Ntelos, Cspire, etc).

 

Sprint needs to focus on executing Network Vision with deploying LTE 800/LTE 2600 and buying up the entire H block and focus on the 600 MHz auction.

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I agree with the majority I would rather have 4 major carriers to keep competition a live but I'd rather see sprint merge with tmobile. I feel it will come down to a point that tmobile and sprint will have to work together to take on the bigger two. I just don't see that in this decade.

 

 

If SoftBank and sprint does get tmobile what do you think sprint should do differently so they don't repeat another nextel disaster? Shut off gsm and sell off aws? Make tmobile customers get a sprint phone within 2 years etc

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I agree with the majority I would rather have 4 major carriers to keep competition a live but I'd rather see sprint merge with tmobile. I feel it will come down to a point that tmobile and sprint will have to work together to take on the bigger two. I just don't see that in this decade.If SoftBank and sprint does get tmobile what do you think sprint should do differently so they don't repeat another nextel disaster? Shut off gsm and sell off aws? Make tmobile customers get a sprint phone within 2 years etc

wouldnt shutting of 3g evdo be best and edge network. Then keep hspa+ and 1x 800?
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The big two have something tmobile and Sprint don't have. It's a large native footprint. Even though most people won't need it, the maps thing is a huge selling point. The combination of these two networks would do nothing to help the footprint. Just my two cents.

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The big two have something tmobile and Sprint don't have. It's a large native footprint. Even though most people won't need it, the maps thing is a huge selling point. The combination of these two networks would do nothing to help the footprint. Just my two cents.

I agree pretty much wherever you can get tmobile service you can get sprint service. Idk I'd rather wait and see how things play out and maybe once everything is on LTE including voice then maybe it would be a great move for them to combine but as of right now I don't see the benefit in them merging besides having a bigger subscriber count. Both companies are struggling but are making progress with their network.

 

Even though tmobile is leading sprint as far as LTE and data sprint will soon pass tmobile once sprint has LTE 2600 fully deployed and 800 LTE turned on.

 

 

Another words let them both continue boosting up their network and maybe in 10 years they can strike up a deal. SoftBank wants sprint to become huge and become #1 in the US so anything is possible

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I think someday it might happen, but I doubt that it would be in the next five years. Sprint just has too much to do right than having to worry about how to integrate T-Mobile.

 

I remember reading very similar statements last year when Sprint's acquisition of Clearwire was just a rumor. The SoftBank acquisition had already been announced and people argued that Sprint had too much on its plate to take on any more. 

 

I agree that any sort of T-Mobile deal probably won't happen any time soon, but Sprint has surprised us before  ;)

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I don't really want to see Sprint and Tmobile merge at this point.  Both companies have too much on their plate right now with both companies working on their own Network Vision and expanding LTE.  Tmobile is also in a transition process to shut down the MetroPCS CDMA network as well and refarm PCS spectrum for HSPA+.

...

[trimmed]

 

Yes and no.  Moving Metro to Sprint CDMA would be EXTREMELY easy, far easier than migrating them to UMTS,  In fact, as more time passes and the more migration work of Metro users to the TMO network happens, potential of a merger between TMO and S becomes all the more distasteful.

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