Whoa, Verizon to acquire Tracfone

[bigsnake49]

https://www.globenewswire.com/news-release/2020/09/14/2092937/0/en/Verizon-to-acquire-Tracfone.html

I wonder if this will pass regulatory muster. I think they will need to shed some brands.

[bigsnake49]

Tracfone has 13 Million of their 21M customers on the Verizon network, which leaves 8M on other networks. I am thinking that the regulators should make Verizon spin those customers off.

[S4GRU]

Yeah, I wonder how this one will go.  

Robert

[Paynefanbro]

Considering Dish's recent purchase of Ting after picking up Boost from T-Mobile I wouldn't be surprised if Dish threw their hat in the ring to buy Tracfone, knowing they can't outbid Verizon but sill doing it in case Verizon needs to make concessions to get approval. Dish could easily scoop up a couple million customers and possibly a favorable MVNO agreement or roaming deal with Verizon.

[hescominsoon]

since so many of tracfone are already verizon i do not see a reason for divestures.

[bigsnake49]

13 hours ago, hescominsoon said:

since so many of tracfone are already verizon i do not see a reason for divestures.

So what happens to the tracfone subs that are on other networks? There is an inherent conflict of interest.

[Paynefanbro]

5 hours ago, hescominsoon said:

since so many of tracfone are already verizon i do not see a reason for divestures.

Only about 12 Million of Tracfone's customers are on Verizon. That's just over half of them. If they were allowed to keep that 12 Million and forced to sell the rest, they'd have roughly the same amount of prepaid subscribers as T-Mobile and AT&T.

[iansltx]

On 9/14/2020 at 9:38 PM, Paynefanbro said:

Considering Dish's recent purchase of Ting after picking up Boost from T-Mobile I wouldn't be surprised if Dish threw their hat in the ring to buy Tracfone, knowing they can't outbid Verizon but sill doing it in case Verizon needs to make concessions to get approval. Dish could easily scoop up a couple million customers and possibly a favorable MVNO agreement or roaming deal with Verizon.

Good point re: Dish being interested. They could ask for divestiture of Family Mobile and SIMple Mobile brands, since both use T-Mobile exclusively, and swapping them over would minimize the impact to those subscribers, while providing Dish an even larger customer base. I'm sure T-Mobile gives Dish a better deal than they do Tracfone, as not only does Dish have a larger subscriber base (Boost is larger than Tracfone's entire non-VZW customer base), but they negotiated their MVNO agreement when T-Mobile had to get the deal done to merge.

Dish could push for divesting T-Mobile based customers from the other multi-carrier brands (Tracfone proper, Straight Talk, Net10, SafeLink), but splitting out the brands might be more trouble than it's worth at that point. Moving an entire brand over would be simpler, even if those brands are sitting on a unified backend on Tracfone's side. Dish will have a billing system of their own to migrate folks to anyway.

[Paynefanbro]

Boost Mobile's founder wants divestitures to occur for Verizon to buy out Tracfone. 

https://www.fiercewireless.com/operators/boost-founder-bucks-waves-fights-new-mvno-battle

[belusnecropolis]

4 hours ago, Paynefanbro said:

Boost Mobile's founder wants divestitures to occur for Verizon to buy out Tracfone. 

https://www.fiercewireless.com/operators/boost-founder-bucks-waves-fights-new-mvno-battle

I feel like this guy has a complex that he sold on the low and feels that the barrier to get back in is so high he can only reenter via government fiat.

[red_dog007]

This is something Dish should have gotten.   That would have put them at 30M subs where they could offset data usage with their own coverage.  Don't have coverage, no problem, just roam on one of the big three. I think they missed a huge opportunity here to help subsidized their network buildout.

Is there a list or data anywhere on like the top 10 MVNO groups by subscriber count? edit: not including prepaid or carrier owned MVNOs (Visible, Cricket, Metro, etc).

What would be funny is if VZ actually pushes those 13M users off their network.  VZ is doing fantastic with their limited resources, but to move 13M off your network onto your competitors, all while you still profit off these users and make your network even better for your post paid subscribers, brilliant!

Edited October 15, 2020 by red_dog007

[JimBob]

Why Verizon Is Betting Big on Prepaid Wireless

https://www.fool.com/investing/2020/10/13/verizon-is-betting-big-on-prepaid-wireless-heres-w/

[iansltx]

On 10/15/2020 at 12:07 PM, red_dog007 said:

What would be funny is if VZ actually pushes those 13M users off their network.  VZ is doing fantastic with their limited resources, but to move 13M off your network onto your competitors, all while you still profit off these users and make your network even better for your post paid subscribers, brilliant!

That wouldn't make sense at all. If it made sense, Visible wouldn't run on VZW's network.

The marginal network costs of a user pushing several hundred minutes, a few thousand texts, and a couple gigs of data is next to nothing at this point if you own the network and it was built out for other reasons than that particular subscriber. Tracfone's brands tend low-usage, do even if Verizon successfully moves all of Tracfone's non-VZW customers to their network the DSS upgrade probably added more capacity than these folks use.

I do think Dish could still angle for some of these customers (particularly the MVNOs that solely run on T-Mobile). Question is whether Dish was/is willing to spend what it would take to acquire them, given that they already have a fair sized customer base to work with in Boost.

[red_dog007]

On 10/16/2020 at 5:18 PM, JimBob said:

Why Verizon Is Betting Big on Prepaid Wireless

https://www.fool.com/investing/2020/10/13/verizon-is-betting-big-on-prepaid-wireless-heres-w/

When we talk prepaid here, this includes Verizon Prepaid + their owned MVNOs such as Visible and Yahoo Mobile?  So with the Tracfone purchase those users would be considered prepaid?

[Paynefanbro]

Verizon is acquiring Bluegrass Cellular too. 

https://www.globenewswire.com/news-release/2020/10/19/2110530/0/en/Verizon-agrees-to-purchase-Bluegrass-Cellular.html

[mdob07]

On 10/19/2020 at 3:32 PM, Paynefanbro said:

Verizon is acquiring Bluegrass Cellular too. 

https://www.globenewswire.com/news-release/2020/10/19/2110530/0/en/Verizon-agrees-to-purchase-Bluegrass-Cellular.html

That'll be interesting to watch. I don't think they own much of their own spectrum, they do have 5x5 B12 and 5x5 B2 in my area. Bluegrass is a huge part of the Verizon network in KY via Verizon's LTEiRA program.

[iansltx]

On 10/23/2020 at 6:22 AM, mdob07 said:

That'll be interesting to watch. I don't think they own much of their own spectrum, they do have 5x5 B12 and 5x5 B2 in my area. Bluegrass is a huge part of the Verizon network in KY via Verizon's LTEiRA program.

Betting VZW trades that B12 to TMo for B66 eventually.

[mdob07]

6 hours ago, iansltx said:

Betting VZW trades that B12 to TMo for B66 eventually.

If they trade it'll be AT&T most likely since they own the B block and Bluegrass has C block. 

[iansltx]

10 hours ago, mdob07 said:

If they trade it'll be AT&T most likely since they own the B block and Bluegrass has C block. 

Ah, fair point. Maybe they'd still get B66 in return?

[red_dog007]

Would have been cool if they had merged with Appalachian Wireless.  Maybe it is only a matter of time until they fall. I dislike seeing these smaller carriers kick the bucket. 

I have not looked into rural carriers profitability in their roaming contracts.  But with Sprint now not being a major roaming partner for these regional carriers, I would not surprised to see more fall in the short term.

With hindsight, maybe we could have expected this.  They did not secure any 600 licenses while Appalachian Wireless secured a number of licenses. 

Has anyone looked into this? Regional carriers that were unable to secure a 600 license?