Here we go again, yet another Sprint/T-Mobile merger rumor. Although this time the odds seemed to have improved to 55%. According to the Wall Street Journal, Sprint shares have increased more than 6 percent after Citigroup raised the wireless provider’s ratings on Wednesday. Michael Rollins, a Citigroup analyst believes that T-Mobile will be buying Sprint within the next year.
As you already know, Sprint, the nation’s third-largest wireless carrier has been losing subscribers left and right due to the lack of “exceptional” customer service, an area in which T-Mobile excels. Rollins claimed Sprint will stem some of its subscriber losses over the next six months. Rollings also claims that Sprint is doing a better job of promoting its products and services in addition to improving its customer service experience. But that’s not all. Rollins wrote in a client memo that the probability “has risen to around 55 percent.”
Even though many observers say such a deal would be disastrous because Sprint operates on a CDMA network while T-Mobile uses GSM technology. Rollins disputes that “if Sprint keeps its bad debt and churn levels down, it could be on its way to growth, with T-Mobile’s help.” And not to mention, they will truly challenge the nation’s top wireless carriers, AT&T Mobility and Verizon Wireless.
What do you guys think? Leave your thoughts in the comments!