T-Mobile merger with Sprint looks more likely as Softbank and Deutsche Telekom agree on sale

T-Mobile merger with Sprint looks more likely as Softbank and Deutsche Telekom agree on sale
By Derek Kessler on 29 May 2014 02:01 pm EDT

Softbank is making an end-run around concerns about a merger of Sprint and T-Mobile US by instead hitting up T-Mobile's parent company Deutsche Telekom. As reported by Japanese news agency Kyodo, Japan-based Softbank has entered into an agreement with Germany-based Deutsche Telekom to buy the latter's ownership stake in US carrier T-Mobile. The US Federal Communications Commission and Department of Justice have expressed their concerns about the potential for such consolidation in the US cellular market, and the move by Softbank would likely end up still being heavily scrutinized.

The end result (a Sprint/T-Mobile merger) would likely still be the same, though this move might bring the two companies as separate entities under the same umbrella corporation first. Softbank bought Sprint last year for $21.6 billion, and they've been vocal about their desire to also buy T-Mobile. Sprint, too, has been pursuing T-Mobile, though it's more likely that Softbank's even deeper pockets would be better suited to such an acquisition.

We don't have any indication right now of how much the deal may end up costing Softbank (estimates range up to $50 billion), though T-Deutsche Telekom's 67% stake in T-Mobile US. When AT&T attempted to buy T-Mobile and was shot down in 2011, the purchase prices was set at a whopping $39 billion. T-Mobile of 2011 was a radically different company than T-Mobile of today. A good portion of T-Mobile's success today actually comes thanks to the failure of that acquisition, which garnered T-Mobile a multi-billion-dollar break-up fee from AT&T, as well as the spectrum needed to enhance their network.

Deutsche Telekom has expressed interest in the past in unloading their share of T-Mobile US, much like last year's massive sale of Vodafone's stake in Verizon Wireless to Verizon. With Deutsche Telekom wanting out of the US, and Softbank wanting to expand rapidly in the US, it seems all but inevitable that T-Mobile will trade hands. But will such a sale and merger be good for US consumers, and what will happen to the Uncarrier in the process?

Source: Kyodo; Via: Reuters

Derek Kessler Derek Kessler "Managing Editor of Mobile Nations" 89 (articles) 5 (forum posts)

Reader comments

T-Mobile merger with Sprint looks more likely as Softbank and Deutsche Telekom agree on sale


Here we go again!

Swiped via CB10 with my T-Mobile USA (Only T-Mo rep still pushing  ) new  BlackBerry Z30 (STA100-5), son! The Thor's Hammer of phones! Member of "Club Z30 "..... the most exclusive club in mobile. Once you go BlackBerry, everything else is wack-berry! #longestsignatureeverthatishortenedabit

Yeah man! Fredysrevng3 is the founding member so just add it to you signature and he will give you the thumbs up! :)

Swiped via CB10 with my T-Mobile USA (Only T-Mo rep still pushing  ) new  BlackBerry Z30 (STA100-5), son! The Thor's Hammer of phones! Member of "Club Z30 "..... the most exclusive club in mobile. Once you go BlackBerry, everything else is wack-berry! #longestsignatureeverthatishortenedabit

All that counts for consumers is price, and service level as a secondary consideration.

They lose money? Who cares, as long as my texts, data and apps work, and the phone rings....

(and for us, whether they offer BB10 phones, LOL)

Zzzzwiped from a Zedevice....

They can only lose money for so long.... It's apparent that the government isn't going to allow Verizon or AT&T take them over. A merger is probably their last chance before one or both looks at ways to cut cost and most likely services. Like leaving small markets or taking towers out of service.

If they were loosing money before and you combine them what do you think will happen? They will continue to lose money. Anyways this sounds like the companies would remain competitors hut under the same patent company which sounds like a terrible idea.

Posted via CB10

Not at all! Plus I think that with John's very bold attitude that he would probably say ok to this. It really creates a backlash in store for us associates when general public start flocking into the store with questions about these "acquisition" scenarios. You get the "I just switched so what does that mean!?" if it's good for the consumer as in service and coverage will improve while maintaining affordable rate plans then yes. But we have all seen this play out before. I guess we just wait and see.

Swiped via CB10 with my T-Mobile USA (Only T-Mo rep still pushing  ) new  BlackBerry Z30 (STA100-5), son! The Thor's Hammer of phones! Member of "Club Z30 "..... the most exclusive club in mobile. Once you go BlackBerry, everything else is wack-berry! #longestsignatureeverthatishortenedabit

Not good for consumers? So big red and big blue buying up spectrum is good for consumers?

Posted via the Android CrackBerry App!

Irrelevant to this discussion. The FCC has already put in restrictions for the next spectrum auction to prevent Verizon and AT&T to go on a buying spree.

NOOOO! I just ordered my unlocked Z10 from BBRY. This merger cannot happen. When Sprint acquired U.S. Cellular all the the customers had to switch to Sprint phones as the spectrum's were different. Not to mention Sprint is....well Sprint. If this merger goes through then I might as well go one over to Verizon. The are too big to get consumed...they do the consuming!

Blackberry keeps Johnson National LLC moving

Have to wonder what it would really do.... If they both have equipment and infrastructure built for only the population centers, will it in any way expand their coverage. For me, that is the only thing holding me back from either one - as the unlimited plans, cheaper rates and bigger subsidizes are very attractive.

One is GSM, the other CDMA, right?

How's that gonna work? Not exactly a great point from an infrastructure perspective.

Zzzzwiped from a Zedevice....

CDMA and GSM are old technology that in a few years (by the time they implement this sale and figure how how to merge) will not even be used. The question is how hard will it be to change their LTE equipment to use the same frequencies - new equipment or minor adjustments.

Old technology doesn't mean it won't be used. Calling is still done through 2G GSM Network while Internet uses LTE. Until VoLTE gets implemented, carriers won't be ditching GSM and CDMA anytime soon.

Besides, MetroPCS ran on CDMA,and that didn't stop the merger. One technology will just get phrased out that's all.

Posted via CB10

T-Mobile is successfully integrating a CDMA carrier into their infrastructure by slowly phasing out the CDMA technology and bringing everyone onto their standard. The same thing could happen here

Yea but it would essentially make ALL of Sprint's equipment useless. What's the point of acquiring both if to merge them you essentially have to buy ALL new equipment. Why not just liquidate one company and use that cash to build out the others network across more spectrum?

Posted via CB10

Liquidate what? What assets? The network assets?

Who's gonna buy that? An new smaller carrier that would be equally doomed right from the start? Sell it off overseas or on ebay? just half-kidding

"No Q10?" -> "Buy from Chen... "

Two carries with bad coverage don't suddenly become one giant with great coverage :)

I jest, but this could be good so long as T-Mobile is still able to bully everyone else into bettering themselves.

I see this as more streamlined competition instead of just lowering the number of competitors.

Posted with a Verizon Z30 running and CB10. [URL="bbmc:C0004F9BB"] My channel with zero subscribers but has Frenchie pics :) [/URL]

I understand the bullying the others into bettering themselves, but I don't see it as true. My wife and I are looking to leave AT&T to T-Mobile. We are taking 5 lines. Dollars-wise it looks to be a lateral move. There is no savings versus the AT&T "Next" plans.

As we can see, to match our plan, we have to trade our handsets, and take an identical plan that won't really save us anything. The no contract plans won't work for is and their plans are similar. At least in my location: south Florida, T-Mobile has excellent coverage and excellent customer care. All my local T-Mobile friends have nothing but positives to say, so I feel okay with the change for us.

Could you explain? I seriously cannot see the big deal either way. All the carries are crappy. I am happy to move away from AT&T but it really does nothing for me other than leave BlackBerry. And that is not a plus.

The only reason to change now is to get out of AT&T before they force their new next-plans on us. According to our sales guy, that is coming and will be the only plans they offer within the next year or so.

Maybe things have changed in past couple years, but if your on an older plan, a legacy plan, can you not just stay on that plan, even if it's no longer offered. Such as I had friends w/ AT&T on the old unlimited data plans and they were all grand fathered in so long as they did not change plans. I have friend with Verizon and she's the same, with a legacy plan.

Posted via CB10

Basically, the difference will be that instead of upgrading the same ol' areas twice (once per carrier), this will allow upgrading once and (in theory) funds for coverage expansion.

The old CDMA equipment was going to be junked eventually anyway, but now the funds that would have been used to replace CDMA with LTE/VOLTE can be used to expand on T-Mo's infrastructure instead.

It's CDMA network is scheduled to be decommissioned by the 2nd of of 2015. All new accounts are GSM accounts now

Posted via CB10

They are doing a trade in for CDMA phones in select markets right now too. CDMA network will be shut off in New England and Las Vegas, June 30th

Posted via CB10

AT&T bought Cricket Also CDMA... assets are customers that's what it will do add customers and cut costs

Posted via CB10

If it goes through, will T- Mo customers have access to BlackBerry phones again? Z30 finally!

Posted via CB10 on Z10 [T-Mo] STL100-3/Software Release Version

Why would BlackBerry want that? So that they have to maintain and test the wifi calling feature (which isn't exactly standard), yet without a reciprocal support from TMO?

My friend is with Sprint and he was forced to switch to Android because of the better accessibility to apps. He said Sprint doesn't have BB phones any longer, but I'm not 100% sure of that. He's thinking of switching back, though.

Sent from my sexy white hot Z10 in Sin City ;-)

They have em! Tell your friend to go back to the store and get a Q or Z10. They just don't want deal with set up.

How's that signature ya crybabies!?

Oh boy here we go again is right! Sprint destroyed Nextel and I won't allow them to do the same to T-mobile with giving my cash to them.. I'll go to Big Red vs AT&T which I came from Last year for 6 Years.

He needs Ritalin, or at least lay off the cocaine. I tend to see him more as a sleazy used car salesman promising the world to people who want cheaper services, but really suckering them. T-Mobile is a sham, which is why I happily left them two months ago after being with them for 4 years.

Posted via CB10

It's not so much that Legere is doing a good job as he's using his sideshow antics to distract from his terrible network coverage.

Posted via CB10

T-mobile added more users than Verizon and AT&T combined last quarter (still posted a loss but that should turn around soon) and the spectrum they got from the botched AT&T takeover will help with their coverage. I love T-mobile, though their coverage outside of metro areas is subpar but that means I'm covered more than 95% of the time. I love their no contract model and have saved hundreds of dollars a year by switching to them four plus years ago.

If the company's an acquisition target and has been posting losses almost, if not every quarter under his tenure, obviously that guy is not doing a great job.

Can't go from losing money to making money overnight. When he took over they were losing a lot of customers. They have grown since he took over. Eventually that growth is going to turn to profit

"Can't go from losing money to making money overnight..." funny how that's not afforded to BlackBerry by the doom and gloom BlackBury crew in the forums. So let me put it like they would.

What's eventually? They've been losing money quarter after quarter (with losses showing no sign of decreasing--last quarter was the largest loss in the Legere era despite one of the prior quarters being when they bought Metro PCS,) declining ARPUs (which TMO itself has acknowledged will not stabilize until later this year,) and no clear strategy spelled out for how they actually plan to turn red into black. Let's face it--the people who are coming to TMO are coming for the low rates. If TMO raises rates or the other carriers decide to drop their rates to equal levels, TMO will be wiped out.

There goes the neighborhood. Makes me want to cancel my mobile service. Any chance BlackBerry would start making land line phones? Oh well. Guess my next mobile phone will be a VTech phone (remember those? )

Posted via CB10

Something for you to think about. Sprint use to own part of the gsm Network that TMOBILE is today. Back around 95 sprint started Sprint Spectrum before there PCS network which was cdma. 96 sold it to Omnipoint which is one of the companies now known as TMOBILE. So before you go poopooing this, maybe do a little research.

They also used to own Nextel and they effectively killed that corporation and it's Iden network

Posted via CB10

Sprint network is crap, it they approve the deal sprint will end up screwing t-mobile up like they did with nextel

Posted via CB10

We won't know anything until the details come out, but it's rumored that as part of the deal T-Mobile execs would have to take the lead and not the Sprint execs. This could mean that their Uncarrier moves would continue and T-Mobile would eventually absorb Sprint(or whatever they end up calling it since I don't think they will maintain the right to T-Mobile)

I certainly hope so. Give all the clowns running Sprint the boot, put T-Mobile's people in charge and I might just feel a little better about this.

My only concern is who is going to be the better winner out of this sale....tmobile or sprint?

Because tmobile has been getting better and better at their service and lowering prices reflected in their customer gains while sprint is sinking deeper and deeper loosing customers. and, I do hope they keep GSM..... no CDMA please!!!

Fat Mexican with a Z10 in CB10

Rumors are that as part of the deal T-Mobile execs get to stay on and run the show. Which actually would be a very good thing considering all the moves they have been making

A CDMA carrier buying a GSM carrier. Did they learn absolutly nothing, nada, zip from the Nextel merger about merging infrastructure? They would be better off spending the 50 billion to build out Sprints Network. This has train wreck written all over it.

Eh, I'm not too concerned about this. T-Mobile purchased a CDMA carrier and is successfully integrating their network into T-Mobile. What ends up happening is one gets shut down in favor of the others technology, which I have no doubt would happen here

I don't like Sprint. I left last year and I don't want them anywhere near Tmobile. Not good for other consumers either!

Posted with none other than the Zed 10

But will such a sale and merger be good for US consumers, and what will happen to the Uncarrier in the process?

No and Buh-Bye.

:-( We need more game shaking carriers, not less.

I have said this a couple of other times: rumors are that as part of the deal T-Mobile execs would run the show. Meaning the Uncarrier stuff would still continue

I hope you are right. It just seems that Sprint is buying TMO and therefore would be the one calling the shots. I would prefer if it was the other way around.

Also, mergers reduces the number of carriers in the US. It isn't like we have a large selection to choose from. They got us by the necks in a choke hold as it is. :-(

At least TMO did cut us a little slack, you know?

Sadly, my experiences with such were drop-call nightmares! I shutter at the thought. I wish I could say I live in the boonies and that was the reason.

I like my coffee BlackBerry Black! What?

Looks like I'll be switching to Verizon to their prepaid plan. Should be a piece of cake since I already have an unlocked verizon Z10 running on t-mobile network

Posted via CB10

Really? Too bad I didn't think about that! I'm already on contract with VZW, but that's something to think about...

Sent from my sexy white hot Z10 in Sin City ;-)

I think that in the long run this would actually be good for consumers, provided the right moves are made. Rumors have it that as part of the deal T-Mobile execs would be allowed to run the show, which I think is a very good thing considering all the moves they have been making. It would be foolish of Softbank to buy T-Mobile and ignore all they have been doing since it's working. While they may not be making tons of money yet, they are gaining subscribers which says something. On the other hand Sprint is hemorrhaging customers

T-Mobile is also successfully integrating a CDMA carrier they purchased(I believe MetroPCS) into their network. I'm not too concerned about this either.

The main reason I'm not concerned is that Softbank is buying T-Mobile, not Sprint. This would allow them to operate independently and create a plan to merge the networks. hopefully T-Mobile's network tech comes out on top and Sprint's tech gets refarmed for better coverage.

Good point!

Swiped via CB10 with my T-Mobile USA (Only T-Mo rep still pushing  ) new  BlackBerry Z30 (STA100-5), son! The Thor's Hammer of phones! Member of "Club Z30 "..... the most exclusive club in mobile. Once you go BlackBerry, everything else is wack-berry! #longestsignatureeverthatishortenedabit

Once upon a time I had a chirp until Nextel merged w/ Sprint then I switched to T-Mobile & if it happens to me again I will eliminate all cellular devices from my life

Posted via CB10

Who cares I hope sprint fully absorbs T-Mobile and wipes them off the map. T-Mobile's network is still a joke and they treat BlackBerry users like garbage.

It would at least make Sprint big enough to finally challenge the ultimate greed that is Verizon and AT&T.

Posted by Antoniius via my sexy Gold and White Q10.

That is indeed one strike against TMO. The BlackBerry hijinks. Mr. Chen actually pulled out away from them, right?
My Q10 is still humming along though. :)

Lol if anyone's network is a joke, it's Sprint's. I live in a major metro area and their service was extremely slow. Switched over to T-Mobile for less money and the speed and coverage is awesome.

Not sure how they "treat blackberry customers like garbage." Sure they offered me $200 towards a samsung. Big deal. I took it, flipped the Samsung and put it towards a z30. Works fine on t-mobile's network.

Posted via CB10

We also seem to selectively forget that Blackberry also treats Blackberry customers like garbage.

Blackberry always.....

I'm currently a sprint customer. I called tech support to find out if the Z30 would work on their network. I was told as long as it is set for GSM, it wouldn't be a problem. Oddly, if I set my trusty old 9930 to GSM; it won't work. Setting it to Global, I'm fine. For what all that's worth.

I hate Sprint. T-Mobile is cutting the cost of service and innovative. This is a bad idea. Less competition is higher price.

Z30 / STA100-5 / / T-Mobile USA

This is uncarrier 5.0 I guess...

I don't care if other people want a bb10 device I wanted one and that's all that matters.

I love T-Mobile;s CEO The guy is fantastic. Why are you guys so damn bitter.?

Z30 / STA100-5 / / T-Mobile USA

I left Sprint for T-Mobile not so much to be on T-Mobile as to not be on Sprint.

If this goes through, I guess I'll be swtiching again.

Predicted this merger. I feel it is a good one it will make companies like At&t and Verizon more customer friendly and modest.

Posted via CB10

For the love of all that is pure and holy: NO!!!!! This merger shall not pass!!!! I'm planning to leave crappy Sprint for T-Mobile.

The worst CDMA carrier in America and the smallest GSM carrier in America. What could possibly go wrong?

Posted via CB10

Question is...exactly how many main parent groups are their running the show? Looking at the big picture makes for an interesting view. Vodafone grp is the 2nd largest (the largest being China Mobile). Vodafone used to own 45% of Verizon but put it up for sale last Sept because VOD is GSM and VZN is CDMA plus they didn't have management control. Now VZN has sole ownership when the deal closed in Feb for $130 billion. VOD had tried to buy out AT&T in 2004 but were outbid by Cingular (combined carrier under the AT&T name). VOD was also in Japan until bought by Softbank.
So in the US, VZN is ranked the largest #1 (#18 worldwide), AT&T #2 (#20 worldwide), Sprint #3 (80% owned by Softbank)
My apologies, I have to stop, trying to follow all of this is making my head spin. :(

Posted via CB10