Analysts Continue To See Sprint, T-Mobile Merger As Increasingly Unlikely

sprint-tmobile

Well, it’s been a little over a week since we’ve had any stories about T-Mobile and XXXX as a target for a potential buyout or merger. That’s good news (though not a record) and analysts continue to express doubts that a deal with Sprint is likely given T-Mobile’s “revival” and Sprint’s 4G network upgrade.

Craig Moffett, of Moffett Research is just one of a many wireless analysts throwing a wrench in the idea that T-Mobile and Sprint are likely merger candidates.

“The DOJ has made it abundantly clear that they want four (national) players, not three,” Moffett told IBD. “T-Mobile’s resurgence can only make the DOJ’s stance that much more definitive…Sprint’s capital spending is soaring and T-Mobile is undercutting everyone else’s pricing. Why would (regulators) do anything to compromise that? The view in Washington is, ‘If it ain’t broke, don’t fix it.’”

Echoing Moffetts thoughts is Paul Gallant, an analyst at Guggenheim Partners who agrees that “the recent actions of Sprint and T-Mobile are likely to reinforce regulators’ instincts to preserve a four-player wireless market.

Gallant goes on to say in a research report that T-Mobile’s aggressive pricing and new phone upgrades are the exact kind of “pro-competition” moves regulators want. As for Sprint, their recent price cut on unlimited data services will find favor with regulators further reinforcing the need for a national market of four-carriers.

USB analyst John Hodulik, whom we reported on August 15th speculating about the future of T-Mobile and Sprint, talked to Investors Business Daily via email and echoed the thoughts of his analyst colleagues:

“If all four carriers are doing well, it will make it hard for Sprint and T-Mobile to merge under this administration,” UBS analyst John Hodulik told IBD via e-mail. “(T-Mobile) would have to lose momentum and go downhill for it to happen.”

In other words, both T-Mobile and/or Sprint would have to quickly reverse their newfound fortunes before even contemplating a move and even then, it might be tough to convince regulators a three-carrier solution is best for consumers.

Investors Business Daily

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  • Willie D

    Actually Sprint DIDN’T cut prices for Unlimited Data, in fact, the price went up if you have more than 2 lines than previously and almost by $50 more each.

    Sprint is a company that even after their own merger has been tanking, Softbank has been hesitant to give Sprint the Platinum ATM card for their use. And between that and Sprint spending the little money they have left on recycling Nextel and Clearwire spectrum to launch LTE prior to launching LTE on the rest of its PCS spectrum, customers are still fleeing in record numbers. None of this bodes well for Softbank who has stated they want to see an immediate market reaction yet have not made a single footstep in the right direction to compete against TMobile.
    There is no way in hell Sprint and TMobile are combining now or ever. The two main reasons these companies will never combine are that the technologies of both companies are different with one being 4G HSPA/LTE centric and using NEW equipment technologies, the other being extremely legacy 3G EVDO centric and recycling 10 year old parts of scrap to rebuild its failing network, butbut also the culture of both companies are severely opposite, with one seeking no contracts and lower prices and offering customers more for their dollar and the other would lock you in 3 year contracts and offer a very loose unlimited guarantee that expires if you look at them wrong (the fine print of this faux guarantee is nullified if Sprint wants to raise the price, if you pay even 1 day late or of Sprint just wants to) if they could get away with it . Gross if you ask me.

    • Chris

      +1 the post above and also…

      I went to Sprint’s site and I don’t understand their pricing…

      They have an Overview Unlimited My Way thing and it says $110 dollars for 1 smartphone. Then they have a plan comparison to T-mo, Verizon and AT&T. They then have their plan at $80. I’m confused. I guess the $80 plan doesn’t include 5GB hotspot.

      • sidekicker89

        yes you are correct.. the $80 plan is without hotspot. I still think it’s odd how they keep saying the unlimited is “for life”… as if they are going to get rid of it soon? or?..

        • Chris

          My coworker is switching from Sprint to T-mobile haha.

        • gentleman559

          My brother switched from Sprint to T-Mobile 3 days ago. He said the data is so fast he doesnt even know what to do with himself. LOL

        • Willie D

          My speed on T-Mobile HSPA+ blows Sprint LTE out of the water. In fact, Sprint LTE is often slower than their own 3G EVDO in San Francisco – provided the tower the device connects to actually has backhaul at all. In my area, 95% of the LTE towers put off a signal, but do not actually have any data connection to them, so your device sits there and stalls, then you manually have to force your phone in the settings, airplane mode, or resetting the device by power cycle to get it to reconnect to 3G, where it sometimes will work.
          T-Mobile LTE blows Verizon out of the water, and is on par with AT&T in my area as well. My average speeds are 15mbps, but I do get up to 30mbps often enough.

        • gadget_hero

          I think it has more to do with PR as T-Mobile took it away, then brought it back. And I think Verizon is going to finally push the unlimited users off, I would imagine it will come with Verizon activating their AWS spectrum, as they have no requirements of allowing those bands to be unlocked like their 700MHz. Sprint is hoping to get people to come and stay by promising for life, it is interesting to note they don’t promise to keep the price on said lifetime unlimited data.

          (disclosure; i use and enjoy t-mobile)

        • Willie D

          The issue with Unlimited For Life is that they are not clear on it.
          1. It IS Unlimited For Life in comparison to other plans, that required you to change plans if you upgraded, downgraded, swapped out a device, etc. Unfortunately if you had a decent plan on Sprint and wanted to get a new phone, you ALSO had to get a new plan by moving to one of their Everything Data plans. This new rate plan guarantees you no longer have to move to a new plan with a new device.
          2. It is ONLY applied to the Unlimited portion, not the price, the coverage area, the roaming, or other features. Meaning after your contract is up, they could decide to charge you $100 or $110 if they wanted, it is still Unlimited For Life, but the price can change ANYTIME since they ONLY guarantee to offer unlimited voice, text and data, but not the price.
          3. If you are late on any bill, even by a day, even just once, the unlimited guarantee no longer applies, even if you stay on the same plan. Meaning Sprint now has a loophole to say, “Sorry, you want to upgrade, that plan is no longer available to you since you were late on a payment 2 years ago”. (Yes, that is actually IN the fine print).
          On top of all this, they limit roaming from 300MB or majority of KB now down to 100MB. They also limit video streaming, YouTube, Netflix, etc from any speed the device and network offers, to a maximum download of 1mbps. They are technically limiting you by far more now than ever on this new “Unlimited” plan.

    • Chris

      So I clicked on their “smartphone” comparison and it links to an iphone 4 8GB… So much for having false marketing on sprint’s site.

  • carcomptoy

    This whole T-Mobile and Sprint rumor mill needs to just stop already. It would just be Sprint/Nextel 2.0, except maybe even worse–much worse. There are almost no synergies between the two companies that would negate the cons, so these stories just need to go away for good already.

    • Willie D

      Agree. The ONLY deal would be if TMobile bought all of Sprint, Nextel and Clearwire spectrum from Softbank and integrated the PCS into their own for HSPA/LTE and used the Nextel for larger coverage and in building penetration..selling off the Clearwire in pieces to AT&T and Verizon, both either owning spectrum that compliments 2.5Ghz or already bought some of Clearwires spectrum in the past, respectively.

    • Morton H

      your right Sprint Nextel Merger was a damn joke anyway that never went anywhere but never went anywhere and had lost customers. Nextel was fine by themselves smh. Sprint always ruins things. TMOB keep up the good work,, with blazing LTE in my area.

  • S. Ali

    Sprint charges ATT/Verizon rates for T-mobile level coverage. Only reason they still have customers is because some people are too lazy or incompetent to change plans.

    • Nathaniel Ily Jacob-Joshua Hud

      I would say t mobile has better coverage and service than sprint.

      • Rod

        Service yes, coverage not at all.

    • SouthernBlackNerd

      umm…. Sprint charges less than Tmobile for unlimited everything when you throw in EIP for one or two lines, and matches up with Tmobile when you go above that.

      Sprint charges 80 dollars for Unlimited Everything, while Tmobile charges 70 + EIP( which is usually 20 bucks for high end phones).

      • S. Ali

        Wrong.

        1.) You pay $199 for the phone on Sprint upfront (if we are talking high-end)
        2.) You pay a $30 activation fee on Sprint
        3.) You have to pay an additional $30 when you want to Upgrade with Sprint plus an addition $199 for a new phone
        4.) You are LOCKED into a 2-year contract

        With T-mobile, I can buy any phone I want (don’t have to use EIP), upgrade any time I want (have the latest device), and cancel whenever I want (no-contract). Don’t spread that Sprint marketing bullshit here, it simply isn’t true. Lets not even get into Sprints terrible 3G network and weak LTE. I’d rather have spotty HSPA+ and EDGE than overpay and get less value.

        • SouthernBlackNerd

          What does that have to do with anything I said? You said I was wrong, then literally never refuted any of the claims I made. I never said anything about Contact or activation fee etc.

          BUT if you want to get into calculations lets do it.

          Sprint
          200 iPhone + 30 act fee + 80/month = 2150 for 2 years

          Tmobile
          EIP
          145.99 iPhone + 21/month EIP + 70/ month = 2330

          BYOD

          650 iPhone + 70/month = 2330.

          Sprint is cheaper than Tmobile. If you want to compare service and value, then you have to look at your specific needs and area you live. However, Cost can be compare universally and Sprint is cheaper than Tmobile in cost for 1 line and 2 line on Unlimited Everything.

          Also can we stop this locked into a 2 year contract BS? EIP is your contract. If I were to stop my Tmobile service, then I would have to pay off the rest of the phone, just like I would have to pay an ETF on other carriers. Tmobile is not going to let me continue to pay 20 dollars without service.

        • S. Ali

          Wrong. Wrong. Wrong.

          Sorry, your calculations are wrong because you assume everyone is getting an iPhone. You’re selectively choosing your data by picking the device that makes your numbers work out in Sprints advantage. Guess what, not everyone wants or uses an iPhone. That is Sprint marketing BULLSHIT, we aren’t that stupid. I can get an iPhone 5 for less than $500 on any second-hand market, but go ahead and post some more false calculations. In fact, I can also go out and get ANY phone I want and bring it to T-mobile. I can also cancel ANYTIME I want. You simply don’t have that option with Sprint locked-in phones. What will you do when you sign up and find out that Sprints network sucks in your area, you’re stuck with a $2000 bill. What a joke!

          Lets not forget the troubles of Sprints crappy network, being locked into a 2-year contract (where you pay MORE after 24 months), and can’t take advantage of unlimited data (3G is a joke).

          EIP isn’t a contract BECAUSE YOU AREN’T REQUIRED TO SIGN UP. Do you even know what the word “contract” means? God damn idiot. This may be the dumbest post I have ever read. I won’t even get into how much of a joke your math is when you get 2 lines or 3 lines. Go ahead and do the calculations……

        • SouthernBlackNerd

          I used an iPhone because it is the most popular device on all four carriers. Try the calculations with the GS4 or HTC One or what ever device you want. The fact of the matter is that any device of those high end devices are going to be cheaper on Sprint.

          So second hand market is equal to brand new phone. Stop being a fangirl with their panties in a bunch.

          Anybody can cancel ANY carrier at any time. On Tmobile you have to pay off the device, but on other carriers you pay an ETF. It is the same thing.

          All the high end phones are basically on all four carriers at this point. Exclusivity is going the way of the dinosaurs. Only Nokia(who is still struggling) and Sony are following those old practices, and I am sure thsoe gys will learn sooner or later.

          Service is on a case by case basis. I already said that. In my area( Atlanta), my Sprint friends get LTE everywhere they go. They also get service in areas my Tmobile phone becomes a paperweight.

          You do not have to sign a contract with any of the three carriers. I could easily go to ATT/Verizon and join without a contract. I can sign up for Sprint’s pay as you go service without signing a contract.

          I take you calling my post dumb a complement. You best argument was that my calculations were invalid because i used the iPhone, which is the best selling device on all four carriers as my basis, but you never even provided a case where I was wrong. You instead argue that you can get a used phone for cheaper as your trump card.

          This was really a waste of time. I assumed I was having an argument with someone who could argue with facts instead of fanboy talking points.

        • P

          Do you know what the term contract implied in fact means? That means a K exist but it is not necessarily on paper (for example, if I were to every day trim your yard and you left a ten dollar bill after each time the yard is trimmed, then a K implied in fact has been created.). EIP is a type of contract Implied in fact.

        • P

          http://www.law.cornell.edu/wex/contract_implied_in_fact

          “DEFINITION

          Consists of obligations arising from a mutual agreement and intent to promise where the agreement and promise have not been expressed in words. Such contracts are implied from facts and circumstances showing a mutual intent to contract, and may arise by the conduct of the parties. A contract implied in fact is a true contract.”

          OVERVIEW

          The absence of an express contract does not foreclose the possibility of a contractual relationship because the parties may create an implied contract by their acts and conduct. A contract may not be implied where an enforceable express contract exists between the parties as to the same subject matter.

          To establish the existence of an implied in fact contract, it is necessary to show: an unambiguous offer, unambiguous acceptance, mutual intent to be bound, and consideration. However, these elements may be established by the conduct of the parties rather than through express written or oral agreements.”

        • P

          Even if my assertion is inaccurate – the UnCarrier claim as a no contract is deceptive: http://www.androidheadlines.com/2013/04/attorney-general-calls-t-mobiles-no-contract-ads-deceptive-t-mobile-agrees-to-change-them.html

        • P

          I meant to say TMobiles UnCarrier Plans along with the EIF

        • Tim Wright

          Don’t spread that sprint marketing bullshit here lmao (Somebody is mad) sprints lte is far from weak . Naysayers smh got’s to love them .

  • besweeet

    Well, doesn’t Sprint have at least 3G in many areas where T-Mobile only has EDGE and GPRS? That would help a little…

    • sidekicker89

      Sprint’s 3G in many places is just like 2G anyway.

    • Jessicad

      Well over here in los Angeles sprints 3G is just as slow or even slower than tmobile edge.. And the bad thing is sprints 3G is everywhere in LA they only have LTE in like 2 streets in east la I feel bad for my friends that still have sprint and bought LTE phones they on slooow 3G 95% of the time, tmobile has more Lte in La already and hspa as a backup which is still fast.

    • Rod

      Not even in the slightest. Sprint has a nationwide CDMA/LTE network that they’re building out on 4 different bands. The only band overlap they have with T-Mobile is 1900mhz. Sprint/T-Mobile would be like the Sprint/Nextel fiasco all over again.

      • jej

        There is already an 8 band LTE chip and Intel just announced a 15 band chip so they could certainly use all of the spectrum in one device.

        • Rod

          New Bands would require new phones. T-Mobile has been trying to get as close to using the same bands as ATT that they can, why would they want to mess that up by joining Sprints mess of a spectrum pot. Plus they would still have the problem that they had with Nextel; Trying to merge two different wireless standards.

        • jej

          Nextel offered a unique product and better spectrum than sprint cmda had. That made it hard to get people to switch. Hspa and cdma have the same features. They would simply sell new phones with hspa and lte or possibly all three techs and gradually build out LTE and hspa as their long term network. It would take years to fully integrate but the cost savings is tremendous even in the early stages. They also used modular equipment so adding hspa to sprint would not be expensive or difficult. I just don’t see how T-Mobile can build out rural coverage and survive margin compression when Softbank undercuts everyone with a fast service offering. They already lack the funding for more spectrum and DT could still cut them loose. If the market is moving to 15 band phones then they won’t have a problem getting them. Even if they didn’t come with sprint bands there is a lot of incentive to make phones for 90 million customers, maybe more if they get coverage down and are aggressive on pricing.

  • zSaVaGeX

    Sprint wouldn’t even help T-Mobile anyways. You can literally call their 3G service as EDGE lol. And their LTE isn’t much faster.

  • Jesus Villafranca

    Sprint 3G has greater coverage than Tmo 3G however their 3G performs as slow, if not, slower than tmobile EDGE so what is the point? Then comes LTE..tmo has more coverage and faster speeds..all while being cheaper..so again, why does people get sprint service…I do not know.

    • kalel33

      Sprint has more LTE markets than T-mobile. It was in the news last week where T-mobile was up to 119 markets and Sprint was up to 156.

      • Anonymous

        Care to count how many metropolitan areas Sprint’s got covered compared to T-Mobile?

        • kalel33

          Sprint has a much larger network than T-mobile, so I wouldn’t be begging for a debate on coverage if I were you.

    • Rod

      They should have more 3G coverage than T-Mobile; they did have a 5 year head start in the 3G game

  • sushimane

    im gonna cross my finger and hope for the best i love tmobile they may not be the best but i dont care. i dont think no one can touch tmobile sense doj stated that they want 4 nationwide carriers

  • g2a5b0e

    The DOJ & FCC are firmly against it anyway, but would anyone REALLY want to see this happen? Put together T-Mobile & Sprint, & this new company is nipping on the heels of AT&T in terms of customer count. With that many customers, you think the things we love like unlimited data, JUMP, & no contracts are going to stay around for long? I highly doubt it. AT&T already copies everything Verizon does. I bet T-Sprint would fall right in line. With about 95% of the U.S. population under these three, It would be the fastest way to turn the wireless industry into an oligopoly.

  • Stone Cold

    I hope this never happens but after all AT&T just bought Leap the parent company of Cricket. So it could happen and they still operate as 2 different companies.

    • josephsinger

      Cricket is small potatoes just like Metro PCS was small potatoes.

      • Stone Cold

        I know my point was it could always happen but unlikely to actually happen.

  • Svengalis

    They should combine to give Verizon and att some real competition.

  • Brian Correll

    if this happens i will close my t-mobile account . sprint is the bottom of the bucket around here . had it and hated it …. left sprint for tmobile .

  • rdg666

    I would never want T-Mobile to merge with Sprint. One of my friends who lives near me has Sprint and is always complaining about the service he gets at home. He rarely even gets service in his room! Ridiculous!

    • Roger Sales

      I don’t get why Sprint service is not that great even in metro areas….I see a lot of 1x in-building coverage where they should be able to get 3G(a good two-three bars of 1x where 3G service is supposed to be present). I was at a gathering and noticed it on my friends phone, and I had a steady two bars of LTE on T-Mobile. It’s a little too common for me to ever think of switching.

  • Kingswood

    Sprint is …(and always will be)…. > T-Mob, and their ghey pinkness

    • Rod

      And yet your LTE is still slower than our 4G HSDPA+.
      Right…

    • Roger Sales

      Sprint has been a disapppointment with their LTE rollout. It’s coming along VERY slow compared to the other carriers even though they started over a year ago.