Well, after two previous failed attempts, it has finally happened: T-Mobile and Sprint have announced merger...maybe. While both companies are calling this a merger, essentially T-Mobile is buying out Sprint to the tune of $26.5 billion, and the carried we now know as Sprint will cease to exist. Officially, nothing has been finalized yet as the merger still needs to clear the massive hurdle that is regulatory approval by both the FCC and the DOJ; this was wall that halted the sale of T-Mobile to AT&T several years ago.
While the deal is far from official at this point, and this whole situation could dissolve eventually, let's operate on the premise that this deal does clear the review, and the merger becomes final. What then does that due for the customers of both companies. In the short term, not really a damn thing. At the earliest, the deal would be finalized in roughly a year or so, and it would take a few years for implementation. Basically, don't even start to think about it until at least 2022. At that point, then some changes may start to show up.
For existing Sprint customers, congratulations because you are now a T-Mobile customer; T-Mobile would have close to 90 million customers now putting them close to AT&T. T-Mobile has claimed that the shift would happen gradually and seamlessly with the goal of no service issues during the transition. In fact, according to T-Mobile, over 20 million customers with Sprint have devices that are already T-Mobile capable so good for those customers. As for Sprint's CDMA voice technology, it would be transitioned to VoLTE leaving Verizon as the only big player using CDMA technology.
So what are some of the proposed benefits? Well, T-Mobile and Sprint claim this would help them assist the United States in being a leader in the adoption of 5G as well as giving them a massive amount of spectrum that can be used to reach those in rural America. In addition, the companies claim by combining forces, they can push faster speeds and lower costs; they even claim to be keeping the "Uncarrier" model with no service contracts and/or hidden fees.
Are these benefits really true? Well, that remains to be seen. Competition has always been good for customers as it forces carriers to offer better services and lower prices to gain traction in the market. T-Mobile claims that by growing to be on par with the big boys in terms of size, they can force prices down for everyone with stronger competition. However, it could ultimately end up leading to increased prices as there will be less competition and no scrappy underdogs to keep the head honchos honest. In addition, market consolidation tends to create a company or companies that become too large to control or abandon. When someone was sick of Verizon or AT&T, they could go to T-Mobile, Sprint, or a smaller carrier. Now, the market will have only three competitors that would be so large they determine the rules.
Will this deal be bad for the consumer? It is too early to say even if it does go through. T-Mobile and Sprint have said some great things that customers love to hear, but those are schmoozing words to get the deal to go through. If it passes, the next few years will be very telling in how the market will shift. The only thing we really know for sure, if the merger is approved, is that Paul will have to change the color of his shirt again, and he will have a whole new set of people to ask if they can hear him now.
While the deal is far from official at this point, and this whole situation could dissolve eventually, let's operate on the premise that this deal does clear the review, and the merger becomes final. What then does that due for the customers of both companies. In the short term, not really a damn thing. At the earliest, the deal would be finalized in roughly a year or so, and it would take a few years for implementation. Basically, don't even start to think about it until at least 2022. At that point, then some changes may start to show up.
For existing Sprint customers, congratulations because you are now a T-Mobile customer; T-Mobile would have close to 90 million customers now putting them close to AT&T. T-Mobile has claimed that the shift would happen gradually and seamlessly with the goal of no service issues during the transition. In fact, according to T-Mobile, over 20 million customers with Sprint have devices that are already T-Mobile capable so good for those customers. As for Sprint's CDMA voice technology, it would be transitioned to VoLTE leaving Verizon as the only big player using CDMA technology.
So what are some of the proposed benefits? Well, T-Mobile and Sprint claim this would help them assist the United States in being a leader in the adoption of 5G as well as giving them a massive amount of spectrum that can be used to reach those in rural America. In addition, the companies claim by combining forces, they can push faster speeds and lower costs; they even claim to be keeping the "Uncarrier" model with no service contracts and/or hidden fees.
Are these benefits really true? Well, that remains to be seen. Competition has always been good for customers as it forces carriers to offer better services and lower prices to gain traction in the market. T-Mobile claims that by growing to be on par with the big boys in terms of size, they can force prices down for everyone with stronger competition. However, it could ultimately end up leading to increased prices as there will be less competition and no scrappy underdogs to keep the head honchos honest. In addition, market consolidation tends to create a company or companies that become too large to control or abandon. When someone was sick of Verizon or AT&T, they could go to T-Mobile, Sprint, or a smaller carrier. Now, the market will have only three competitors that would be so large they determine the rules.
Will this deal be bad for the consumer? It is too early to say even if it does go through. T-Mobile and Sprint have said some great things that customers love to hear, but those are schmoozing words to get the deal to go through. If it passes, the next few years will be very telling in how the market will shift. The only thing we really know for sure, if the merger is approved, is that Paul will have to change the color of his shirt again, and he will have a whole new set of people to ask if they can hear him now.
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