SoftBank CEO: Less resistance from regulators on merger over the past few months

SoftBank CEO Masayoshi Son Earnings News Conference

In an interview with reporters in Tokyo early this morning, Masayoshi Son, SoftBank’s CEO has been discussing the state of the U.S. market and the possibility of consolidation between Sprint and another carrier. He claims that over the past few months there has been new movement from regulators in regard to their feelings on any merger.

Son believes there is less resistance now than there was at the beginning of the year, and that more discussions “on many different angles” would be beneficial.

SoftBank’s chief believes strongly that the U.S. market would be a better place with three strong competitors than it is now with 2 big network operators, and two small ones. Stating “we can make it more effective by getting bigger scale.” And that “becoming a more credible competitor in scale is something good for American consumers and citizens.”

Despite his comments, he understandably hasn’t (and won’t) mention a merger between Sprint and T-Mobile directly. But in reality, there aren’t any other carriers Sprint could realistically merge with and be big enough to compete with AT&T and Verizon in terms of scale.

Earlier this month it was reported that SoftBank and Deutsche Telekom have agreed a deal in principle for the Japanese carrier to acquire DT’s controlling stake in T-Mo for around $32 billion in cash and stock. This deal will allegedly see Deutsche Telekom retain a 15% share in the merged company. If it should fail to go through, the compensation to T-Mobile/DT is purportedly set at $2B.

Circling back to regulators, it’s really the only thing that could stop this deal going through. Both Japanese and German companies are keen to get a deal done, and Son is allegedly lobbying hard to get his point of view across to regulators. While some think the deal will be done by next month, it’s hard to imagine that it’ll be completed so soon.

In the mean time, we have tomorrow’s Uncarrier 5.0 event to look forward to. We’re expecting a live stream to be available and will post a link once we find it.

Via: Reuters

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  • Willie D

    Remember when banks merged and it created less competition in the 80s, and when big banks merged or died out completely in The Great Recession and now look, less competition to the point they all are making record profits and giving customers zilch in return for their business.. Why would anyone approve this? If Sprint WANTS to compete and grow, it needs to fix its network and it had money to do so, but by buying a competitor that’s all its doing, buying a competing player and it will result in competition dying. Softbank does NOT compete in Japan over wireless in the slightest, why would they here?

    • Ky

      Great examples.

    • Maximus

      Sprint is not making the decisions here….Softbank is……Softbank is trying to salvage a sinking ship. They would rather latch on to TMO’s coat tails and help them succeed which in turns helps Softbank in the long term.

  • Paul

    “…becoming a more credible…”

    Sprint hurts T-Mobiles credibility.

    • ronjon400

      im sure that would be true if that was the case. But….. John Legere will be running the ‘new’ company and the name will not be sprint.

      • fsured

        I don’t understand why everyone thinks John staying in charge means things will be the same. It could very well change for the better or worse with customer service and rates. John may be in charge and the company may keep the name T-Mobile but it won’t mean it will be the T-Mobile we have today. He will have to do what his boss tells him to do regarding the new company. If Son say raise the service price he will raise the price. Things would stay the same in the short term to maintain customers.

        • ronjon400

          just wait and see then i guess

      • vrm

        He will be eased out within 3 months by the sprint establishment, even if he is put in charge.

  • Paul Garrison

    I guess he will just ignore the T-mobile consumers that don’t want any part of Sprint. I honestly think that if the merger goes through that many will leave T-mobile for another carrier. It will be another win for Verizon and AT&T.

    • vrm

      He just greased washington and that is good enough to ease it thru

    • vrm

      I already left for at&t last month.

      • Maximus

        Congratulations, you’ve won a higher bill and a two-year contract.

        • vrm

          bill actually comes lower and coverage is better. But what you say will happen if sprint buys t-mobile. Of course, as someone who keeps promoting that, you will deny it.

          If you weren’t completely ignorant, you’d know at&t has no contract postpaid plan with discount for BYOD.

        • Maximus

          If the ATT deal was great why didn’t you switch before the merger rumors?

        • vrm

          isn’t this thread about the reason for switching ? Go back to the first post.

      • xmiro

        ok thanks for the announcement

    • Maximus

      It would be foolish to switch to ATT or VZW just because of a merger. Sprint is the company that is disappearing, not TMO with a merger. Softbank knows that Sprint is synonymous with poor quality, and TMO is associated with progressive, new ideas. Why do TMO subscribers think their service will get worse? John Legere is supposed to stay on and the TMO brand is what they are going to use. Things will only get better. It’s foolish to jump ship before anything has been decided. But have fun paying higher prices at ATT.

      • Adrayven

        Thats a rumor.. likely planted by SoftBank.. don’t believe it.. it’s directed right at T-Mobile customers to ‘minimize’ jumping ship..

        SoftBanks history is MUCH more interesting.. in the past.. they have increased contract periods, raised prices, and eliminated unlimited plans after a completed buyout… The only reason they did not with Sprint was because when he really got in, he realized Sprint couldn’t, to far behind and they’d loose more customers.

        By eliminating T-Mobile, he’s in a more solid position to do just that. THATS why he wants t-mobile.. As long as T-Mobile is in play.. he cannot do what he’s done in the past. T-Mobile is in the way..

        I fully expect the same from them this time around…

        • Maximus

          I have to disagree with your assessment here. He would have to be very foolish (which I don’t believe he is), to eliminate a brand that is on the way up in order to promote a brand that has serious issues. The environment and industry he as in in Japan is very different than the situation with Sprint in the U.S. There is no way he could raise prices or contracts with Sprint. Every single customer would leave for a prepaid option or VZW/ATT. Sprint is the poor man’s carrier. The only way they can compete is on lower prices and better terms. They certainly don’t have the quality coverage to compete on.

        • vrm

          t-mobile is a dead cat bounce for sprint.

        • TMO Insider

          Duh what. Please stop with your ridiculous comments. They make no sense and bring no intelligence to the blog.

      • Paul Garrison

        It would be foolish to think this is good for consumers and the overall competition of the wireless phone market in the U.S. This only helps a dying Sprint and the investors of Softbank. I am quite sure that changing back to the old ways will not happen over night, but it will be done in increments just the the uncarrier strategy. SB will slowly bring back the restrictions that T-Mobile thumb there noses at.

        • Maximus

          I don’t think people would stand for increased restrictions and higher prices. There would literally be a revolt or serious backlash from customers. Although it would seem like less competition with three carriers, there are still options. People vote with their feet. Their will always be lower priced options for that market of the population. The reduction from 4 to 3 carriers would have a marginal impact.

      • vrm

        sprint ain’t going anywhere. Do you think a name change changes everything ?

        • xmiro

          it will be buried in Kansas with big giant tombstone. Masa is keeping T-Mobile in Bellevue or he’ll move it to California but with their tax rate I doubt it

    • TMO Insider

      Interesting observation, but, when T-Mobile acquired Metro PCS, it was for the spectrum that was available, which is currently being converted to, um LTE. Thus desk is a win-win for T-Mobile. We get to operate as a bigger competitor to AT&T and Verizon, as well as, if the deal does not go through, we get about $2.3 billion to put towards new spectrum and our employees. Sounds good to me.

  • http://vitalgroundz.com Lord Bailey

    I don’t totally agree with a merger with sprint, but i do see a need to get ride of DT as a controlling interest. They have a history of not caring what is in the best interest of TMUS. Rather just just want to squeeze out as much profit as possiblefrom them and keep moving. I only wish that TMUS could buy back shares and make a run at it solo.

  • Jay J. Blanco

    I just want 2Bil & 1900mhz spectrum from Sprint. Maybe even some 800 mhz to compliment Mrytle Beach

    • Adrayven

      Wistful thinking.. likely they’ll let it go through and Sprint/SoftBank will destroy T-Mobile’s uncarrier movement, go back to contracts, raise prices, etc.

      • TMO Insider

        Nope, T-Mobile management will continue to operate the new firm, oh also retaining the T-Mobile name. UnCarrier will continue to disrupt the industry and redefine what customer pain points need addressing. No contracts, no price raises (except those necessary in an ever growing economy) and simplified billing (which starts on your next bill cycle). T-Mobile did not grow leaps and bounds by making bad decisions and we won’t start now. Tomorrow is going to be fun.

    • jeremyvbk

      Spectrum won’t be apart of a break up fee. The $2 billion will go to DT and Tmobile will never see it. Sorry

      • Jay J. Blanco

        This whole deal sucks. Softbank don’t want to lose anything for a break up fee.

        • jeremyvbk

          No it is just that it is high risk. You won’t go to a casino and put all your money down on something you initially have small odds on. With the initial doubt’s it lowered the break up fee. Masayoshi Son is not dumb enough to use spectrum(I hope). Son is a powerful man. He has already swayed the FCC from the looks of it. This may actually be good because it can show the big two(ATT/Verizon) they aren’t the only big player. He maybe able to sway them to keep at least a 10x10mhz slice of 600 for the new company.

        • DirkDigg1er

          It’s funny that you say that. I think we all pictured this merger as a high stakes game of poker lol.

          Believe it or not, Sprint customers also complained about last years’ Softbank buyout and it improved the situation.

        • Jay J. Blanco

          Yeah your right, thanks for the analyst

        • TMO Insider

          Neither did AT&T and we all enjoyed how that worked out.

      • enkay1

        What are you talking about? The $2 Billion isn’t going to Deutsche Telekom. AT&T’s $4 Billion didn’t. No official details about this merger have been released yet so you have no idea.

        • jeremyvbk

          Yes the $4 billion did go to the Parent Company DT. As will any break up fee. That is how Deals work. DT will use that money for its investments in Europe

        • gadget_hero

          The $ went to D.T. and the spectrum (AWS-4) went to T-Mobile US.

        • TMO Insider

          Wrong!

      • TMO Insider

        Actually, you are all incorrect. The bid is for a publicly traded company. Any break up fee would be paid directly to that entity. Furthermore, at the time is the AT&T attempted merger, DT was the sole entity brings the T-Mobile US brand. One group you fail to consider are the thousands of employees who were ask compensated as a result of the breakup. That money came out if the breakup fee. Please stop spewing your nonsense add if you were real businessman. If you had an ounce of an understanding of how mergers and breakup fees are structured, you would ask be millionaires.

    • DirkDigg1er

      So you would give 50m customers, new network, and $22b in investments lol?

  • Edgar

    I think this is marketing. He is pushing this so hard. I only see this as way of trying to convince people and Washington. They have talk so much about it and have not done anything.This is a prove that they don’t have nothing to show for.

    • vrm

      t-mobile is a dead cat bounce for sprint.

  • VG

    I’m hoping Tmonews will stop publishing these perhaps, maybe, possibly corporate merger and rumor stories and go back to T-Mobile news that directly impacts customers.

    • Paul Garrison

      I actually like it all, but we do need more headset news though.

      • Cam Bunton

        You want more handset news? That can be arranged. I just didn’t want to ignore any developments of a merger that will almost certainly directly impact customers should it go through.

        • Willie D

          It won’t directly impact us, most of us are leaving for AT&T and Verizon (unlimited data and international plans or not) because many of us came over from Sprint and HATE Sprint that much.

        • Chriz

          “Most of us” meaning just a few of us who think they know exactly what’s going to happen with the merger, and all in negative light. “Abandon ship, things might possibly perhaps happen!”

        • Chriz

          And by “us” I mean “you”. I’m not leaving T mobile until the s*** hits the fan for real, and not some imaginary fan or imaginary s***.

  • John will screw us

    This shit is getting old. Report again when the deal is done or dead. Preferably dead.

  • gadget_hero

    This guy is full of it. Reducing the number of carriers has not helped Japan’s cellular performance nor has it helped pricing. In fact NTTdocomo has much lower prices despite being the incumbent. Not to mention Softbank-Sprint-T-Mobile has much less scale than D.T.-T-Mobile.

    Perhaps instead of plowing $30 BN into trying to buy T-Mobile he should plow that into fixing Sprint’s shitty network? Because from what I can tell he is selling the same load of shit that AT&T tried to make for BellSouth, T-Mobile (albeit they didn’t get this but all of what they said about network roll outs ended up being lies), and now DirecTV. And you know what the result from all their promises were and grovelling to the government, nothing. All lies.

    • DirkDigg1er

      Blame DT. Just one month ago they said they wouldn’t sell Tmo anytime soon. All it took was $5 extra dollars and free iphones to change their mind lol.

  • Brian90

    If they merge, I’m leaving. Sprint is crap. They will use the Sprint name, Sprint poor customer Service AND SPRINT PRICING! Sprint has the nerve to charge almost as much as ATT for crap service.

    • DirkDigg1er

      How about we just wait and see what happens lol.

  • maximus1901

    If sonny boy simply wants scale, why doesn’t he do an lte network sharing deal with TMO and commonize their lte bands on their phones, keeping the 3G mess separate?
    Won’t that result in “good-enough” scale?
    Is it possible that sonny boy just wants to eliminate a competitor? Hmmmmm.

    • jeremyvbk

      But its the combined customers count of the company does that can make the build out of rural LTE worth it to investors. I could see a halt in DT investments in Tmobile so that way they are not out more money if the deal seems to be going through. If you are selling a car, would you want to install an expensive radio , and use it for a few months and get no extra money for that which you installed?

      • Todd_the_Hunn

        If it was profitable a rural LTE network would already be in the works . That was AT&T’s carrot for their TMO merger . Why would DT halt investments . Look at the other mergers in place ? Dish had a deal inplace for Sprint before Softbank recklessly upped the ante . Comcast was also looking TMO . The question the FCC will ask is basically will removing one of the four networks benefit the American consumer . I think they will rightfully block this merger . The thing is I also thing Softbank will sue the FCC if it doesn’t break their way .

        • DirkDigg1er

          Dish also around the same time had “a deal inplace” with T-Mobile, Clearwire, DirecTV, Lightsquared, and ATT. It looks like Dish should have paid the premium instead of undercutting so much.

          Comcast can’t be taken seriously. They recently stated they are using wifi to compete with Verizon lol.

          The FCC seems concerned about how the merger will affect upcoming spectrum auctions. It’s a calculated risk that has to be taken. It’s interesting because he may actually shake up the market for real.

        • Todd_the_Hunn

          Comcast did inquire and I wouldn’t say Dish undercut seeing how Softbank has obvious buyers remorse to the point that their willing to give TMO billions on a dicey merger attempt .

        • DirkDigg1er

          Dish original wanted to buy Sprint because of Sprint’s 51% ownership in Clearwire. Son baited Sprint investors by saying he was going to buy Tmo instead and investors eventually took the offer. When Dish lost the battle with Softbank, they battled Sprint for partial ownership of Clear. The hint was that Dish was purchasing Clearwire debt preparing to get the spectrum through bankruptcy auction.

          I won’t denounce the Comcast rumor because I would like to see them try.

  • Todd_the_Hunn

    It has to be easier to say stuff like this rather than ” I can’t believe I overpaid for the lemon that is Sprint please help me ” . The regulators never tip there hand . I guess this is a better lie than I will bring America cheap broadband .

  • http://about.me/daylondeon Deacon

    love how these guys pretend to know or care about American consumers’ best interests. gtfo Son. this is nothing more than a portfolio padding and you’ll do whatever is in the best interest of $ afterwards.

  • haru280
  • HothTron

    What mind frame does this nut job exist off of? He’s completely out of touch.

  • Chardog

    Stop saying “done deal next month”. Numero uno- Not even officially announced by EITHER COMPANY YET. Even after that, without any regulatory resistance, there are still holding periods for commentary (at least 180 days, if I recall correctly from the AT&T merger). Nothing is happening NEXT MONTH… Oy…

    • philyew

      It’s simply a turn of phase to describe the parties reaching an agreement to purchase certain holdings, which would then have to go through the regulatory process. That could certainly happen next month.

      It’s clear from the rest of the article that this isn’t describing the deal closing, which would only come after regulatory approval and would probably take until next year, even if not opposed by the federal authorities.

  • sushimane

    i say this lol the only reason why the govern bodies are less resistance because they already made up their mind on keeping four carrier in the states and rejects the merger.

    • TechHog

      You’re in deep denial, my friend.

      • sushimane

        Hey I might be right or wrong no one knows I’m just saying it out of humor. But if I’m right and Softbank make a bid for t-mobile July or August and it get reject I’m hoping it doesn’t effect t-mobile from getting good bit of 600mhz that’s sum thing I’m hoping for. I know the govern bodies takes a 180 days to look over the whole merger or whatever. But they will see that there’s no clear benefit for the consumers because they basically cover the same areas but tmobile has a better network and importantly spectrum frequency overlap each other.

        • DirkDigg1er

          Sprint/T-Mobile may not necessarily need the spectrum screen if they combined. If Son financed Sprints’ Clearwire purchase, I pretty sure he’ll open his wallet for 600mhz spectrum.

        • sushimane

          He may but we don’t know his real intention. Softbank might be DT when DT bought out voicestream for 51 billion and it basically drain out DT wallet. We just don’t know like what john said if FCC and doj rejects it t-mobile got money for anything if it get rejected. Let’s just sit and watch I guess I’ll stick with the nexus 5 just the fact it support both carrier frequency.

        • TechHog

          It’ll affect the auction. Also, you’re definitely wrong because your original comment made no sense whatsoever.

        • sushimane

          We just need to wait and see the outcome of the so called merger. Thats all we know.

  • TechHog

    I knew it. I hope all of you people talking about how the deal has no chance of going through have your crows ready.

  • Tony Chen

    son is bullshitting about cheaper plans just look at their fees in framily plans

    • DirkDigg1er

      did you check out those Sprint LTE deals? Lmao

  • Nearmsp

    The deal will NOT happen. Son can talk all he wants, I am going to unleash a campaign not seen before. I am going to quote every statement Spring CEO made against any more mergers to single handedly stop AT&T and T-mobile merger. I am going to shame the regulators with their own statements when they stopped the previous attempt. I am going to quote what AT&T said about T-mobile going down and show the subscribers on T-mobile then and now. I am going to show Sprint’s own mismanagement and how it is being affected by T-mobile and why it wants to kill the most fierce competitor. Finally, I am going to quote what the regulators said when they said no to AT&T. So, yes, we are waiting in the background for Son to come inside the fighting ring. He is going to get a fight of his life. If this goes through, regulators are going to come with some egg on their face and permanently damage their credibility. Bring it on!

    • UMA_Fan

      Maybe you should see how it’s structured first before you jump into any rash judgements.

  • james

    I’m ok if they keep t mobile ceo and jump program sprints customer service horrible

  • mingkee

    Sprint has to fix the network before merger talk, period.

    • Andrew Paul Moulton

      lolwut? The whole point of buying t-mobile it to facilitate the improvement of their network.

  • jnkmail239

    Bla bla bla so in other words they have now payed off enough officials .. sprint is probly in cohuts with att and verizon to bring down tmobile since it has made them look like the crooks That they are

  • http://twitter.com/tabascotx Mike Roberson

    Hey just thought of something. You could call the Japanese Softbank & the German Deutsche Telekom, the “Axis” cell phone carriers VS the “Allied” US Regulators..lol

  • Paul

    @Cam Burton
    Just saw that AT&T expressed their opinion on the merger;
    While it looks like AT&T CEO Randall Stephenson won’t fight the Sprint/T-Mobile deal quite as vigorously, he did have some thoughts to share on the matter.
    “The problem as I see it is the way the government shut our deal down. They wrote a complaint and a very specific complaint. You’re consolidating the industry from four to three national competitors,” Stephenson said during an event in Washington, D.C., according to Re/code. “If you think of Sprint and T-Mobile combining, I struggle to understand how that’s not four going to three.”

  • Durandal_1707

    What is “chicken killing dog” supposed to mean? Some kind of weird anti – Asian slur or something?

    Seems pretty uncalled for, in any case. I don’t like the idea of this merger either, but there’s no point in getting personal insults into it.

  • Durandal_1707

    Why don’t you explain to us what you meant by that then?