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Sprint Tmobile merger Disc.

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23 hours ago, bigsnake49 said:

What about the 2500MHz RRHs?

The early public comments were that band 41 would be shutdown, Sprint users moved to AWS, and Band 41 then brought back up as 5G only.  This would rule out keeping Mini Macros and 8T8R.  Massive MIMOs would need to be moved to areas with less spectrum if I am correct in that they can only handle 120Mhz (60MHz 4G and 60Mhz 5G initially).  Sprint has all the B41 licenses in many urban areas.  With gaps, that is 194Mhz of spectrum.  Why pay for 4G complexity if you are only going to have 5G?  8 or 9 carriers gets reduced to 2 or 3 carriers with a dramatic increase in upload speeds (depending on whether FCC allows use of the gaps).

Uncertain on how small cells would be handled.  T-Mobile may go fiber fed for better performance and to free spectrum.  They certainly would need to be relocated in many cases and upgraded to 5G.  Small cells would be easier to attach to if they were on the primary B41 frequency with the secondary used for backhaul.  You would also likely want a 5G MagicBox.

Areas with 28mm T-Mobile Spectrum (parts of Ohio for example) may stand a better chance of retaining Sprint sites for use with this band.

P.S.: Early plans likely have been modified.  Assuming the merger is approved, the FCC merger condition documents will be a must read.

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I'd imagine that B41 on LTE will be used for a while while 5G equipment gets deployed.  Especially by the time the merger wraps up Sprint will have B41 on a vast majority of their macros.  Already near 70% aren't they? Until a large chunk of phones support 5G, adding ~50million customers while removing 60MHz of LTE seems crazy. 

I imagine this will be a slow multiple year process. 

It took Tmobile 2 years with Metro, ~10million customers and shutting down 10,000 sites.  Yeah, Tmobile has experience here, but this is 5x the project, nationwide, and they are talking about taking it at a per market basis while getting it done in the same amount fo time?  Plus we don't even know any restrictions the FCC may place on Tmobile that could mess with timelines. Seems very optimistic.  If they can pull it off, more power to them, but it's a huge project!

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If the merger is approved, T-Mobile plans on becoming completely self-funded.  They will issue bonds in dollars and Euros for $19 billion of debt refinancing,  $4 billion for liquidity, $7 billion for loan B debt. This includes bi-lateral with Deutsches Telekom, for a total of $19 Billion.  That will give the new T-Mobile $70 billion in high yield debt.   They do have consents for Sprint and T-Mobile bond holders.

This article also mention $10 billion of integration spending.

source: https://seekingalpha.com/article/4226264-t-mobile-us-inc-tmus-presents-bank-america-merrill-lynch-2018-leveraged-finance-conference?page=7

 

Note: secured loan B debt is defined as: "senior debt and are usually not subordinated to other indebtedness of the borrower." It may not be allowed to be prepayed.  Source: https://content.next.westlaw.com/Document/I03f4d8b5eee311e28578f7ccc38dcbee/View/FullText.html?contextData=(sc.Default)&transitionType=Default&firstPage=true&bhcp=1

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I'd imagine that B41 on LTE will be used for a while while 5G equipment gets deployed.  Especially by the time the merger wraps up Sprint will have B41 on a vast majority of their macros.  Already near 70% aren't they? Until a large chunk of phones support 5G, adding ~50million customers while removing 60MHz of LTE seems crazy. 
I imagine this will be a slow multiple year process. 
It took Tmobile 2 years with Metro, ~10million customers and shutting down 10,000 sites.  Yeah, Tmobile has experience here, but this is 5x the project, nationwide, and they are talking about taking it at a per market basis while getting it done in the same amount fo time?  Plus we don't even know any restrictions the FCC may place on Tmobile that could mess with timelines. Seems very optimistic.  If they can pull it off, more power to them, but it's a huge project!

It has been stated in their strategy that once merger approved .. current sprint customers will remain on the sprint network and anyone signing up new will automatically get put on the tmo network.. and one tmo feels enough capacity is on the network ( via integration) then sprint customers will be moved over to the new T-Mobile


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One very important thing to remember is that the merger is not just for T-Mobile to get the Sprint spectrum and other assets.  A major part of the purpose of the merger is to get the 50+ million Sprint customer base thereby giving them a much larger customer base to earn money from.  I am sure they do not want to drive millions of those newly acquired Sprint customers away to their competitors by making them have a terrible network experience and they do not want to ruin their existing network by suddenly overloading it with new acquired Sprint customers which will drive both Sprint customers and T-Mobile customers away to better performing networks.

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I suspect many of the Sprint users would be happy being on TMOs networks. And I assume from past experience Tmo will get sprints network working quick.


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1 hour ago, radem said:

One very important thing to remember is that the merger is not just for T-Mobile to get the Sprint spectrum and other assets.  A major part of the purpose of the merger is to get the 50+ million Sprint customer base thereby giving them a much larger customer base to earn money from.  I am sure they do not want to drive millions of those newly acquired Sprint customers away to their competitors by making them have a terrible network experience and they do not want to ruin their existing network by suddenly overloading it with new acquired Sprint customers which will drive both Sprint customers and T-Mobile customers away to better performing networks.

There is no possible way to accommodate 50+ M of Sprint customers with just 1900 and 800MHz. Band 41 LTE will be around for a while and 2.5GHz will be shared between 5G and LTE. As more and more phones include 5G then more and more spectrum will be assigned to 5G. Already we have instances in some areas of T-mobile's network being oversubscribed in some areas.

Edited by bigsnake49

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Assuming approval, the big question for us is where do they want to start market wise.  T-Mobile typically goes to where they can get the best return on investment, which has historically meant urban areas.  However they could start with old T-Mobile oversubscribed markets, markets where they are losing the most Sprint customers, or the easiest markets to complete (ones with small sprint market share), or areas where Sprint spent the most on roaming which could now overload T-Mobile if present in those areas.   The first few markets could also just be used to test their approach.

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I hope the first thing they do after the merger completes is to make VoLTE calls and LTE data work seamlessly across both the Sprint and T-Mobile legacy networks.  That would require changes to the core data centers that power the Sprint network to make them operate like T-Mobile's network.  Once that work was completed, both networks would be able to operate as the new T-Mobile network with all Sprint customers and all T-Mobile customers able to use all the combined LTE bands their devices were able to use.  New T-Mobile would then be free to thin out the network by removing redundant sites, move antennas and spectrum around as needed, and most other work they need to do with minimal disruption to the end users.  Work could simultaneously start with deploying 5G on low band and high band spectrum on sites that are going to stay running.

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I assume they will update firmware for VoLTE for as many phones as economical, along with other bands.  This may not occur until an area is moved over.

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24 minutes ago, dkyeager said:

I assume they will update firmware for VoLTE for as many phones as economical, along with other bands.  This may not occur until an area is moved over.

Yeah, maybe T-Mobile will allow VOLTE on older iPhones rather than iPhone 8 and above.

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Again, I posted it earlier , but Braxton carter said: at the beginning if merger is approved sprint customers will remain on the sprint network and resume as normal.. anyone new signing up with sprint will automatically be placed on the TMO network.. Once TMO feels enough capacity is added to the network ( current sprint customer) become free agents and can sign up with the new TMO( which is believe current sprint customers will receive an enticing deal). Those were Braxton Carter’s words at a conference.. So, sprint customers will not be able to keep there plans according to this strategy. TMO roaming will remain open to sprint customers as well in the mean time .. as T-Mobile works on integrating the networks.. also , the new T-Mobile will become a self funded company

 

 They will issue bonds in dollars and Euros for $19 billion of debt refinancing,  $4 billion for liquidity, $7 billion for loan B debt. This includes bi-lateral with Deutsches Telekom, for a total of $19 Billion.  That will give the new T-Mobile $70 billion in high yield debt.   They do have consents for Sprint and T-Mobile bond holders.

This article also mention $10 billion of integration spending.

So, expect higher pricing , as the new tmo is going to be spending big money the first few years into the merger

 

 https://www.google.com/amp/s/www.bizjournals.com/seattle/news/2018/12/10/t-mobile-braxton-carter-sprint-takeover-strategy.amp.html

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1 hour ago, tyroned3222 said:

...Once TMO feels enough capacity is added to the network ( current sprint customer) become free agents and can sign up with the new TMO( which is believe current sprint customers will receive an enticing deal). Those were Braxton Carter’s words at a conference.. So, sprint customers will not be able to keep there plans according to this strategy...

"Free agents", this implies that a person could go out and buy a top of the line phone on lease or installments or 24 month contract that they can not really afford and expect that when the merger is approved in the first half of next year, as mentioned by Legere, their outstanding amount would be forgiven.  Is that really what you meant to say?  I could not find it in the article or transcript (perhaps I missed it).  I would hate to see others get in trouble based on this.

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"Free agents", this implies that a person could go out and buy a top of the line phone on lease or installments or 24 month contract that they can not really afford and expect that when the merger is approved in the first half of next year, as mentioned by Legere, their outstanding amount would be forgiven.  Is that really what you meant to say?  I could not find it in the article or transcript (perhaps I missed it).  I would hate to see others get in trouble based on this.

Well, he implied that current sprint customers would be given the choice to switch to the new TMO. So, if sprint no longer exists.. I would say a customer at that point has the choice to go on to the new TMO network based on a better deal and carry their phone over as a switch and tmo pay it off or can switch to another provider. Although, there isn’t any direction or strategy on that yet I think that how it would go . He even said sprint stores would remain after merger if approved and people would walk in and sign up for TMo plans

 

 

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OK, so no free lunch.  I saw that as they could remain on their Sprint plan but perhaps be limited in some fashion or get a new T-Mobile plan.  Traditionally T-Mobile just moves people to new plans that are typically better and then T-Mobile gets the cost savings of reduced back office expense and easier customer service.

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18 hours ago, bigsnake49 said:

 

There is no possible way to accommodate 50+ M of Sprint customers with just 1900 and 800MHz. Band 41 LTE will be around for a while and 2.5GHz will be shared between 5G and LTE. As more and more phones include 5G then more and more spectrum will be assigned to 5G. Already we have instances in some areas of T-mobile's network being oversubscribed in some areas.

Does anyone know if Sprint has completely built out all their 1900 band?    I know they had received more (G Block?)  when they had to return some 800 and 900mHz back when they closed with Nextel.    I'm just wondering if any spare spectrum is available, so once T Mobile gets the green light, there is something they can quickly implement? 

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1 hour ago, dro1984 said:

Does anyone know if Sprint has completely built out all their 1900 band?    I know they had received more (G Block?)  when they had to return some 800 and 900mHz back when they closed with Nextel.    I'm just wondering if any spare spectrum is available, so once T Mobile gets the green light, there is something they can quickly implement? 

They have built out all of their 1900MHz. Block G was the first 1900Mhz spectrum to be used for LTE.

They have not made all their macro sites triband. The only fallow spectrum is the rest of the 2500MHz on which 5G can be quickly deployed.

Edited by bigsnake49
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RCRWireless has an interview with the Sprint CFO. He emphasized the fact that the Capex they are spending this year is foundational to the combined company, for example putting band 41 on all their sites, Massive MIMO, etc. They are very careful not to spend anything that will be stranded if the merger is approved, like back office systems that need to be updated.

He also said that the $10B of integration expenses/investment includes a substantial amount for termination of long term leases.

https://www.rcrwireless.com/20181213/business/sprint-cfo-merger-strategy

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T-Mobile is going to do as they wish, subject to FCC limitations.  The Sprint executives will likely be on some beach figuring out whether their drink umbrellas are adjusted correctly while they watch their enhanced investment portfolios and figure out what they want to do next, if anything.  The joys of golden parachutes!

Most of the Next gen sites I have seen are rural locations often with only Sprint on the tower.  This fits Sprints historical pattern of doing rural areas first.  The comments could point to collusion if the merger review drags out for another year like I think and urban former Clear sites are not Tri-banded as permits indicate.  

The more interesting paragraphs:

"So we've recently improved the liquidity again by expanding the term loan B by just over a billion dollars and more importantly in many regards from my respect putting in place this amendment to the term loan B documentation which then allows us to potentially significantly up size the spectrum notes if the merger didn't get approved, and if we had to pay for standalone life."

"...this last quarter we returned to wireless service revenue growth year-on-year. We expect that level of wireless service revenue growth to continue for the foreseeable future...  ...Now we don't expect that level of growth to expand materially, but we do think that the level of growth that we've now got is sustainable. So once you get through a few quarters of that, all of a sudden you start to generate year-on-year wireless revenue, service revenue on a full year basis. So there's a revenue growth story."

source: https://seekingalpha.com/article/4226498-sprint-corporation-s-management-presents-bank-america-merrill-lynch-leveraged-finance?part=single

 

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T-Mobile is going to do as they wish, subject to FCC limitations.  The Sprint executives will likely be on some beach figuring out whether their drink umbrellas are adjusted correctly while they watch their enhanced investment portfolios and figure out what they want to do next, if anything.  The joys of golden parachutes!
Most of the Next gen sites I have seen are rural locations often with only Sprint on the tower.  This fits Sprints historical pattern of doing rural areas first.  The comments could point to collusion if the merger review drags out for another year like I think and urban former Clear sites are not Tri-banded as permits indicate.  
The more interesting paragraphs:
"So we've recently improved the liquidity again by expanding the term loan B by just over a billion dollars and more importantly in many regards from my respect putting in place this amendment to the term loan B documentation which then allows us to potentially significantly up size the spectrum notes if the merger didn't get approved, and if we had to pay for standalone life."
"...this last quarter we returned to wireless service revenue growth year-on-year. We expect that level of wireless service revenue growth to continue for the foreseeable future...  ...Now we don't expect that level of growth to expand materially, but we do think that the level of growth that we've now got is sustainable. So once you get through a few quarters of that, all of a sudden you start to generate year-on-year wireless revenue, service revenue on a full year basis. So there's a revenue growth story."
source: https://seekingalpha.com/article/4226498-sprint-corporation-s-management-presents-bank-america-merrill-lynch-leveraged-finance?part=single
 





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Don't know if people are aware, and surprised no one has mentioned, it looks like Sprint participated in the millimeter wave auctions, what looks to be under a different name according to the CFO. This could work both ways whether they go at it alone or together with TMobile, who does indeed need to expand on their own mwave portfolio.

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23 minutes ago, nexgencpu said:

Don't know if people are aware, and surprised no one has mentioned, it looks like Sprint participated in the millimeter wave auctions, what looks to be under a different name according to the CFO. This could work both ways whether they go at it alone or together with TMobile, who does indeed need to expand on their own mwave portfolio.

Yikes, The auction that they needed to participate was the 600mhz one, but since we know they were colluding with Tmobile for a proposed merger it doesn't matter anymore. Sprint has plenty of unused spectrum for 5G, that 120mhz of band 41 would allow them to bring peak speeds of 4Gpbs as 5G mature. Tmobile paying 26 billion for Sprint I would say they got it on the cheap. 

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8 minutes ago, NYC126 said:

Yikes, The auction that they needed to participate was the 600mhz one, but since we know they were colluding with Tmobile for a proposed merger it doesn't matter anymore. Sprint has plenty of unused spectrum for 5G, that 120mhz of band 41 would allow them to bring peak speeds of 4Gpbs as 5G mature. Tmobile paying 26 billion for Sprint I would say they got it on the cheap. 

I think it's a matter of picking up whats a finite resource at this point. Besides Dish hoarding a sh*t ton of spectrum, there is very little to be had at the midband or lowband range, so its not unwise to go for what's out there.

I'm still meh about 600mhz, from what i've seen so far, it's no different from 700mhz and gets easily congested especially at 5x5, which is most of what Tmobile has deployed (assuming they are saving some unused spectrum for 5G)

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Yikes, The auction that they needed to participate was the 600mhz one, but since we know they were colluding with Tmobile for a proposed merger it doesn't matter anymore. Sprint has plenty of unused spectrum for 5G, that 120mhz of band 41 would allow them to bring peak speeds of 4Gpbs as 5G mature. Tmobile paying 26 billion for Sprint I would say they got it on the cheap. 

Tmo must of been very confident that this merger would get approved..


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7 minutes ago, tyroned3222 said:


Tmo must of been very confident that this merger would get approved..


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With the current administration, all you need is a nice bribe, but I don't want to get political on this forum.

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