SoftBank reportedly wants to end T-Mobile-Sprint merger negotiations

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UPDATE: A new report from the Wall Street Journal also says that SoftBank wants to back out of the T-Mobile merger, while Reuters says that SoftBank is concerned about losing control of the combined company. Meanwhile, a report from CNBC claims that while there are some struggles in the talks, SoftBank is not planning to back out of the deal.

 

ORIGINAL: There have been many reports in recent weeks suggesting that a T-Mobile-Sprint merger was all but complete, but now it looks like the deal may not happen.

SoftBank, Sprint’s parent company, will reportedly propose ending merger talks with T-Mobile parent company Deutsche Telekom as soon as Tuesday, October 31st. That’s according to Nikkei, which says that SoftBank wants to end merger talks due to “a failure to agree on ownership of the combined entity.”

It’s said that Deutsche Telekom insisted on a controlling stake of the combined T-Mobile-Sprint, and that some people at SoftBank were okay with that as long as SoftBank had some sort of influence. However, SoftBank’s board recently decided that it wouldn’t give up control, and today it decided that it wants to call off the merger talks.

Several reports have surfaced in recent weeks that suggested that T-Mobile, Sprint, and their parent companies had reached a broad agreement and were hammering out the finer details of their deal. It was expected that the merger would be announced sometime in November. Now it sounds like SoftBank and DT may not have been able to agree on how much control each would have over the combined T-Mobile-Sprint.

This news is surprising considering all of the reports that we’ve heard about this T-Mobile-Sprint deal in recent weeks. And while there’s a chance that the companies involved could come to an agreement, it’s now looking like the long-rumored merger involving T-Mobile and Sprint may not happen.

Source: Nikkei

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  • Hurlamania

    wait till sprint dies and pick their bones.

  • fentonr

    T-Mobile needs talks of a merger with Sprint to end more than it needs a merger. Doesn’t matter if that happens because a deal finally dies or a merger finally happens, something definitive just needs to happen because T-Mobile’s stock price has been effected by a possible merger since pretty much day 1 and it needs to end.

    T-Mobile is fine on their own, they’re growing and they can manage their debt with enough cash left over to continue to fund expansion. Sure, that doesn’t leave a lot left over, but as they continue to grow there will be more and they can do that without Sprint. A merger, on the other hand, would mean assets, yes, but more debt, a lower quality of customer (all of these cut your bill in half customers would leave) and a merger hastle.

    Better to let Sprint die on their own and then pick up any assets that look good.

  • Roger Sales

    Sprint needs this deal to happen, not the other way around. T-Mobile is going to thrive because they have been king at innovation and anticipating what the market wants. Until that stops happening, its T-Mobile’s game to lose.

  • Joseph McCovery

    I have this odd feeling that when Sprint does die, SoftBank will gladly entertain offers from Verizon and At&t before giving T-Mobile a remotely sizable chunk of spectrum.

    • Acdc1a

      Dish and Comcast are better partners for Sprint. Sprint is not going to die.

      • (J²)

        No TV provider has demonstrated that a Wireless-TV partnership is actually beneficial. When TV providers accept that the future of live TV is online, then I’d agree.

        That would ultimately lead to increased competition with video streaming services, which would drive TV prices down which doesn’t help TV providers or content providers.

        AT&T has proven that it can keep absorbing companies, growing larger and larger but with absolutely no real benefit to customers and no innovation. It’s just a way for businesses to expand.

        • tendoboy1984

          ATT is doing fine with DirectTV.

        • (J²)

          AT&T owns DirecTV and brand is doing fine but it was doing fine without AT&T as well. My point is these kinds of M&A serve no benefit to the business or consumer, it only allows the company to tap into industries and markets to increase revenue.

        • Mike Thaler

          J –
          I definitely agree the future of TV delivery is online. Even ATT has seen this with their rather new partnership w. DirectTV in a streaming Service called Directvnow.com. Dish has one – Sling.TV. Google just started in April w. live streaming in 5 cities. Now in 50. Name is YouTubeTVLive. Comcast is due to lose 150,000 cable customers this 3rd quarter. Hulu is another big operator. Even Comcast has taken a stumbling step towards streaming. (Nothing released yet.).

        • SirStephenH

          AT&T got DirecTV’s live streaming service DirecTV Now out of their merger…

        • (J²)

          That service already existed. That’s how mergers work!

          Apart from that, what has the combined company been able to produce?

      • SirStephenH

        Dish, yes. Comcast, no. Comcast is constantly voted one of America’s worst companies for good reason. A T-Mobile/Comcast merger would be as bad or worse than a T-Mobile/Sprint merger.

    • Willie D

      That would fall into anti-trust, by limiting a secondary player in some areas and by giving consumers only one operator once Sprint was dead (supposing it really did die). It would instead go into a holding company much like Alltel did where parts are divided and sold between bidders, one of which may be T-Mobile for the spectrum in select areas.

  • Nearmsp

    This deal was never going to get approval from the Trump administration. With an election 1 year away no politician would have supported this. The Germans were never going to give control to Sprint for a merger which Sprint desperately needed. Sprint customers who were on these boards arguing for a merger can now move to T-mobile and enjoy the great network speeds and great customer service.

    • Jason

      Especially because it will result in a tangible reduction in jobs, something President Trump would never want as it is his signature issue.

      • the job thing doesn’t even matter were losing 8 out 10 jobs to machines. Nothing can be done about that besides innovate and create new jobs

        • Jason

          The job thing matters. Its always mattered, and it especially matters in areas other than the coasts in the former industrial base. And frankly its quite easy to spur on domestic industrial production and jobs. Slap a tariff on foreign steel and see how fast jobs matter and come back.

        • Your point is invalid…. people aren’t going to want to pay high prices to keep a stank job here. They are cheap plus wages aren’t increasing amd inflation is constantly rising every year. Not going to work nope the system is broken

        • SirStephenH

          The truth of the matter is that the world’s current economy won’t work in the not too distant future. With machines constantly taking over jobs once done by humans there will not be enough jobs to go around.

        • Very true and everyone is crying China taking our jobs. No our companies are leaving due to cheap resources labor and practically no regulations

      • dtam

        Yeah, that guy is a loose cannon. He’s most likely going to sign into effect a tariff on imported solar panels to “save manufacturing jobs” for two failed solar companies. Problem is, increasing the cost will affect the 180,000 solar installation jobs. So basically to gain maybe 1000 manufacturing jobs, he’s willing to kill about 60,000 installer jobs. Not only is he robbing Peter to pay Paul, he also put a bullet in Peter’s head along with grabbing Peter’s wife by the *****

        • Jason

          Increasing the cost doesn’t bother me. The way I see it if we are paying people a bit more to manufacture in America we have 2 major benefits. Higher quality goods and the dollars going to American workers and their families rather than minimum wage Chinese workers.

        • dtam

          you’re not getting the big picture, you’re saving 1,000 manufacturing jobs by sacrificing 60,000 installation jobs

        • Jason

          No you’re really not. First of all, the 60K number is something made up out of whole cloth that either came from your mind or some free trade thinktank, its bogus. If there is a demand for solar panels, it will accomodate the prices for domestic production and spur on new competitors to reach a new market equilibrium. Secondly, there is a certain social contract that used to apply to Americans. If you incent local production, and maybe pay a little more, the dollars are doing double the work. They are paying for a product plus paying to keep other Americans working and contributing to the economy. I dont know when this became all cock eyed and this free trade garbage kicked in,but you cant live in a country with just elites on the coasts, the rest of the people will riot.

    • tendoboy1984

      I’m on T-Mobile and wanted the merger to go through. Sprint has a larger selection of phones to choose from.

      • SirStephenH

        You can bring almost any phone to T-Mobile unlike with Sprint. Who has the larger selection?

  • (J²)

    I think a T-Mobile/Sprint deal would have been approved but they would have likely been forced to break up/sell some assets.

    SoftBank simply wants to run a successful carrier without actually running it successfully.
    SoftBank is similar to Research In Motion’s Blackberry brand. The company was in denial and against change and ultimately, that lead to their demise. The only difference is, I’m sure SoftBank wants a say in how T-Mobile is run (which defeats the purpose of the merger).

    Sprint is an example of what happens when a company loses touch with its base/targeted consumers and fails to develop brand loyalty. Give me one good reason why a customer should be loyal to Sprint? I’ll wait… lol

    • Willie D

      Sprint’s original consumer base wasn’t consumers at all, it was business customers. It was customers who primarily lived and worked in major urban centers, traveled by car along major freeways or traveled between and stayed in hotels relatively close to major airports. Sprint then expanded, and opened up their doors to the average consumer, and it was great for a time, but that merger with Nextel the spectrum swap the FCC forced on them was just not a good match. Sprint didn’t gain much from Nextel, and Nextel while a fantastic company with stellar service was going to be obsolete in the next few years as 3G services took off, something Nextel using iDen was just doomed from the start. The botched merger of those networks and devices further alienated both business and consumer customers through the years, the botched merger/network sharing of Clearwire, the “come back to Sprint” deals that were offered to customers to come back to Sprint were the same as new customer deals, all of that…pathetic. They did too little, too late to gain consumers trust, they did too much too soon to lose said trust, and have continued to place a lot of consumer complaints, network issues, and policies in favor of blame toward the consumer. They are not only out of touch, but have failed to be innovative since 2000 when they opened the doors to non-business customers.

      • (J²)

        Exactly! I just feel, that Sprint hasn’t done enough (to this day) to secure it’s own future and building lasting relationships with consumers and businesses.

        Sprint has managed to stop the customer bleeding but once 5G is deployed, I expect Sprint to be late and drop the ball… again and that will probably be the final nail in the coffin.

        Management is just entirely too stuck in their ways and clearly unable to adapt to change. Unfortunately, this can also be said about Blackberry.

      • Iceman

        The beginning of the end for Sprint was their introduction of ASL (Account Spending Limit) accounts. Yes, they did grow but with customers that didn’t do them any favors. I was a Sprint customer from 1997-2014.

        At the beginning, cutting edge network with world class customer service. At the end, ghetto fabulous service with painfully slow data. The only thing that kept me going was their phenomenal call clarity but even that began to falter as they tried to squeeze every single ounce out of their sites. The other big nail in the coffin for me was their WiMax service. Sold me an unlimited service and then sent out letters saying the service was going to be limited.

        Made zero sense. Spite your loyal customers for puny amounts of additional capacity for Clearwire customers. What a fiasco that was.

        • Tony Chen

          sprint service is soo bad nobody wants their free 1 year service from sprint deal LOL

      • ltnstar

        ok sprint paid 35 billion for nextel, and that seems to be the worst acquisition. yet that was in 2005. since then they have made plenty of mistakes still. from wimax, to network vision to, and to the deployment of lte. they have changed ceo and have had softbank invest in them. so how is the company not a success after that bad 2005 merger. poor leadership. Remember the ceo they have now thought it was a good idea having a commercial where someone calls tmobile customers ghetto.

    • tendoboy1984

      They have a better selection of phones than T-Mobile. Other than that, Sprint has sucked for a long time.

      • IJK

        Almost any GSM phone will work with T-Mobile. You do not have to get your phone through them

      • Nearmsp

        With iPhone, Note and Galaxy, PIxel 2 on both networks what more “selection” does want? Buy your own phone. End of matter.

      • SirStephenH

        T-Mobile will work with almost any phone and Sprint won’t. Who has the greatest selection again?

  • Jason

    I told you so. I bet some govt regulators whispered into certain ears that it aint happenin.

    • Mike Thaler

      But the chairman of the FCC is close to major owner of Softbank, as I recall.

      • SirStephenH

        All the career regulators at the FCC were against it and planning on doing everything they could to block it.

  • squiggleslash

    If T-Mobile is not on top, then there’s no point in going ahead with this. Softbank and Sprint have shown no evidence that they’re capable of managing their office’s WiFi let alone a nationwide cellular network. I do think there’s a good chance that a combined entity would be stronger competitively against the big two, but unless T-Mobile are on top, I just don’t see it working.

    • Fabian Cortez

      Softbank and Sprint have shown no evidence that they’re capable of managing their office’s WiFi let alone a nationwide cellular network.

      It doesn’t get any truer than this.

      The floundering carrier is still at ~54 million customers. And that’s with them throwing free service at customers.

  • DannyMac

    Please let this be true!

  • Tony Chen

    yes! t mobile doesnt need sprint :) sprint should go away

    • Matt

      With the recent acquisition of 600mhz spectrum, the need for a merger is no more.

      • SirStephenH

        Merger talks started after the auction and Sprint doesn’t own any low-band besides their 10Mhz slice of 800Mhz. This was never about low-band or coverage.

  • Daniel Holmstock

    OH PLEASE LET THIS BE TRUE!

  • tendoboy1984

    I’d rather T-Mobile mere with AT&T. At least AT&T does a better job with their cellular service than Sprint.

    • squiggleslash

      T-Mobile + Sprint = T-Mobile or nothing
      T-Mobile + AT&T = AT&T

      No, I’d rather they merge with Sprint, with T-Mobile’s management in charge.

  • Stephan Tchorbajian

    Honestly, I’ve been reading all of this and am relieved to hear this merger isn’t going to happen. However, with these courses of events this information honestly tells me that Sprint(s) management team, “Middle America” culture and CEO – Son are truly mediocre. Even if the two companies merged and the prices somehow miraculously fell I would still leave. I don’t want to be part of any company that is linked to Sprint. This entire experience tells you that sometimes fast growth, and short term gain backfire in your face. Sprint will probably fold in the next year or a maximum of two. At this point there is no hope for the combined entity. I think T-Mobile(s) management saw this when Sprint left, pursued a tie-up with a cable company, and came back to T-Mobile as no matter what they would never relinquish a controlling stake.

    More than likely Deutsche Telecom management wanted Softbank as a silent partner and would redo the branding, and use Sprints spectrum portfolio. T-Mobile doesn’t desperately need Sprints assets as I believe they can buy them at a wholesale or cheaper price than their current worth. I actually believe Sprints spectrum is even more valuable than the company itself. It will just be smarter for Sprint to go bankrupt, and Softbank to sell off Sprints spectrum at a premium, or break the company and sell it off as they will at least recoup their initial investment or a part of it. Sprints owners have to face the fact they made a completely moronic investment and either lose money or break even at best, because no amount of desperate antics will save the sinking ship that’s Sprint. P.S. I have tested their network speeds and they truly suck.

    • SirStephenH

      This is all true that everything that they could obtain from Sprint they could obtain elsewhere with less hassle. This merger is for customers, not towers, equipment, spectrum, etc. With one merger they could nearly double their subscriber base. Not the best reason for a merger though in my opinion.

      • tony77

        Agreed, it’s a customer base play as everything else is available cheaper elsewhere. If T-Mobile thinks it can continue to add 2M net postpaid customers a year, then what is the right price to pay for ~30M Sprint customers?

  • Matt

    This is good news! It’s a win for consumers.

  • Sharti24

    Fake news

    • Nearmsp

      did you see Sprint stock fell 10% today? Is that fake too?

      • Sharti24

        So they dropped .60 cents, Big deal. Sprint will die a slow painful death without tmobile. This news came out of left field. Last article about the merger was “its happening soon” now this crap. Please

        • Nearmsp

          A 10% fall in stock price is not a “big deal”? Ahmm, do you own any stocks at all? And no it did not come out of the “left” field. This was reported in the Wall Street Journal based on a press release in Japan over the weekend after the Soft Bank board meeting. For the poor service that Sprint provides, if it closes, the share holders deserve to get a hair cut. It is a poorly managed company and needs a CEO like Legere to right the ship.

        • Sharti24

          If Legere runs the new proposed company im all for the merger. If softbank and their deep pockets try to step in after the merger happens i think it would be terrible. After this report idk what to believe anymore. I think it would get approved by the republicans with the excuse of sprint is dying anyways. Either let us merge or we will go bankrupt in a few years

  • Durandal_1707
  • ltnstar

    best news!! softbank wants cake,ice cream, and to eat too. kick rocks sprint

  • vinnyjr

    John Legere is just too damn smart for these guys. T-Mobile has turned their Network into the most robust of all mobile networks and continue to improve daily. Their towers have all the latest and greatest hardware, they will be ready for 5G before any other Network. T-Mobile doesn’t need anyone, they will always listen to God business but has to be solid for T-Mobile.

    • Sharti24

      You live in a tmobile fantasy world dude

      • Jason Caprio

        I understand where he is coming from though. I was in the Boston area where he lives last year when I had T-Mobile, and their network is actually really great there. It was always fast and had a strong signal in all the areas I visited. That was the same trip where Vermont, New Hampshire, and Maine had non-existant service lol

        • Sharti24

          Well duh. Any major city Tmobile works great. Once you hit rural cow land tmobile struggles

        • SirStephenH

          The cows should use a different network then. NO network has perfect coverage.

        • vinnyjr

          NH & Maine have band 12 now and T-Mobile service is far superior in those areas than the others.

        • Jason Caprio

          In terms of Maine, T-Mobile only works along the I-95 area, go 5 miles outside of that, you’re roaming on US Cellular. Even AT&T Roams in Maine.

      • vinnyjr

        Hardly, I travel up & down East coast, my service is fantastic. I’ve had all Carriers, none compares to the signal strength & speed I get from T-Mobile. Every month their service continues to get better. I know the quality of T-Mobile Network, my brother is a tower jockey & works for all Carriers, T-Mobile spends more $$ on updating and adding new towers. When 5G is released T-Mobile will be ready to flip the switch.

        • Sharti24

          In rural NE Ohio tmobile did the cheap/fast route of switching their 2G Edge only towers to 1900 pcs LTE, Thats only 5x5mhz. So no not all towers have the latest and greatest hardware. They did this to reuse gsm antennas. It would be nice if some of those towers had band 4 2100 aws 20×20 but they dont :/

        • vinnyjr

          They’re not finished. Another few months and the s–t will hit the fan. Very Fast!!!

        • bkat11

          Are you sure T-Mobile has the spectrum holdings to deploy 20×20 in that area?

        • Sharti24

          Probably not 20×20 but it would be nice for some 10×10 aws in the city of 20k. They’re currently running 5×5 pcs on some towers and a mix of 5×5 pcs and 5×5 band 12 for CA in rural parts. Reminder these were edge only towers that were converted to LTE so no hspa on them. Zip 44663

    • bkat11

      While I agree on the towers all having the latest and greatest hardware…the ONLY reason that is true is due to them having outdated hardware before launching LTE. But as far as robust I would say pump the brakes sir! We’ll see how the network looks in a couple of years when they have deployed a large part of 600mhz

      • vinnyjr

        1.3 million new customers every quarter for last 14 quarters and their network just gets faster. That says it all. T-Mobile has plenty of back haul, last to instal LTE, latest & greatest hardware. T-Mobile has plenty of juice left. Thank You T-Mobile, Thank You John Legere.

        • bkat11

          Wow dude you’re all fired up

  • Matt

    That’s a little inappropriate to throw in a racial slur.

    • dtam

      Not exactly a racial slur, just stupid and unnecessary?

      • RC

        Was going to leave a comment to OP but just seeing how he butchered “competition” leaves me with no desire to pass judgment on his profound ignorance. In all likelihood conceived through family love and prime example as to why educational reform in this country is way overdue…

  • tony77

    Good. Why pay a premium for Sprint now, when it’s only a matter of time before they are forced to hold a fire sale? Apparently Charter/Comcast reached a similar conclusion. Now TMO can get back to siphoning off Sprint’s customers each month without feeling conflicted. If they need more spectrum in the meantime, Charlie Ergen would love love love to do a deal with T-Mobile.

    • Reagan1

      Very good analysis…and Dish would be a better move.

    • They_Call_Me_Bruce

      The reason you do the deal now is exclusivity. If Sprint folds then you are dealing with competition from who knows where for something you could have wrapped up without outside interference. By keeping things between T-Mobile and Sprint T-Mobile is able to negotiate on their own terms. You see it in sports where a team tries to lock up a potential free agent early because once he hits the market you lose control of the situation. Someone more desperate or with deeper pockets steps in and forces you to alter your plans. You want to avoid the unknown as much as possible.

      • tony77

        I agree – but only at the right price, and I think Sprint is worth much less than Softbank wants. Sprint hasn’t turned a profit in years, and has fewer customers, lower revenue, and more debt than it did when Softbank bought in. The only thing they have to look forward to is a merger; that’s not a strong position to negotiate from – and a compelling reason not to overpay. Whatever Sprint is worth now, it will be worth less than that a year from now.

        I think Masa Son miscalculated and overpaid in 2013, and other than hiring a new CEO has hardly invested anything since then. I don’t think he will get out of the current situation without either ceding control, selling at a loss, or investing a lot more money in his business.

  • HeatFan786

    Woo hoo, no Sprint.

  • Hmm we will see

  • JLP474

    When your company is 30 BILLION in debt do you really think you’re going to have a major influence on what goes on? lol

  • steveb944

    Oh so they wanted Soft-Mobile. That’ll sure bring in customers…

  • Sharti24

    Tmobile better make this deal happen. They need to merge with sprint to compete with att and verizon now. Sure tmobile is set up for the future but they will never catch att or verizon the way they currently stand

    • dtam

      They don’t need to catch them in size, as it stands they are large enough to compete and are profitable

    • SirStephenH

      They don’t need to match them in size in order to compete. Anyways, they’re consistently pulling customers from the other three as they currently stand.

  • Luis Hotdaddy Vasquez

    Best news of the year!!!

  • Andy Madeit

    This is great news. SoftBank wants control which would be the worst thing to happen since they have continued to run Sprint into the ground. T-Mobile doesn’t need Sprint at all. sprint is the sinking ship here.

    • Sharti24

      Who’s buying who here? If softbank wants full control i agree that tmobile should back out. Dont need softbank running tmobile into the ground like they did sprint

      • SirStephenH

        This isn’t a buyout, it’s a merger. In a merger both sides have to come to terms with what the combined company would look like.

  • Mike

    Softbank wants controlling power which is dumb since Sprint is 4th place and is bleeding money. If Softbank wants controlling power they should of tried to buyout Deutsche Telekom. Rmember Softbank tried to buy tmobile 3 years ago for $32 billion now that T-mobile is better shape they’ll have to double the offer.

  • Notpoliticalyet

    It’s better to have more carrier options for the consumers. You bring it down to three major players, while this is still ok for consumers, having the 4th carrier in there makes it that much better. Tmobile wants to eliminate another player albeit smaller but still competition that is closer to Tmobiles ratings and also close in on Verizon. It’s all for Wall Street looking great on paper. They could not care less about Joe Schmo consumer and the deals they may not be getting with the merger. There are benefits to the merger with an expanding network and coverage but right now with Tmobile the way it is i’m fine in a major metro area. I also think they have improved some in more rural areas. I have better coverage in at least two other places that once had little to no coverage.

    • marque2

      Having 2 prime players, a so so company and then an ineffective non competative Sprint, doesn’t really make for “four competing companies” Competition would be much stronger if Tmo could become a prime player like Verizon and AT&T and with Sprint gone, since they are ineffective, it would actually not cause any rate increases. I would guess rates would go down with three prime competing players, rather than just two.

  • mingkee

    I am against this merger no matter from which side.

  • Joe2050

    T-Mobile does not need Sprint as much as the other way around. Agreed the more carrier options the better it is for the domestic market. Again with more mergers or aquistions there is less incentive for these big companies to compete for your business as you have far fewer choices to choose from if this were to happen.

  • Chuan Ren

    I would assume Softbank just found another investor or better deal to keep Sprint live…That’s the only logical explanation here if this rumor is true.

  • SirStephenH

    Good riddance.

    So SoftBank wanted control over the combined company even though they did absolutely nothing to improve Sprint? So instead of a larger, more successful T-Mobile we’d get a T-Mobile with the ownership that has brought us today’s Sprint? GTFOOH

    Hopefully they’ll work on a T-Mobile/Sprint merger now. Their spectrum is perfect for T-Mobile and it will help them compete better from a content standpoint.

  • ” J.D. “

    To all you so called perfect etiquette commenters – If you been through what i went through with so called sprint you would probably say a whole lot more & much more nastier things than I so cut the B.S. / If you read my past posts you know I HATE THEM WITH A PASSION

    • deepdebt

      I wish my experience was different. I have used them three times in the past, all ended in sorrow, and not because of the quality of their network. Do I hate them? No, but introspection of their business practice is needed. It’s laughable to think they should have ANY role in governing the merged entity.

  • riverhorse

    Yes, the T-Mobile & Sprint merger ain’t happening. So now the alternatives entail Sprint merger with Charter, Dish, US Cellular, Bell Canada… Acquisition by Nippon, China Telecom, Vodafone, Telefónica, Richard Branson, Carlos Slim, Patsy Ho, Facebook, Google, Snapchat, Uber, Elon…

    • deepdebt

      I’m thinking either Apple or Google should pick them up.

      • riverhorse

        I really wouldn’t mind if Amazon did… more product choice, lesser price.