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Justice Department Skeptical About Sprint Acquisition of T-Mobile

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Original poster
Apr 12, 2001
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Back in December, it was reported that Sprint -- the U.S.'s third-largest cell carrier -- was preparing a bid to acquire T-Mobile, the country's fourth-largest carrier. The deal, depending on the stake Sprint attempts to buy, could be worth more than $20 billion.

Recently, a pair of Sprint board members met with the U.S. Department of Justice to discuss a possible acquisition, reports The Wall Street Journal. The report says the DoJ has concerns over a potential deal.
The conversation, which occurred in January, signals the seriousness of Mr. Son's interest in a deal, but also underscores his highest hurdle. U.S. antitrust authorities believe the current lineup of four national carriers is important to maintaining a competitive market, and department officials indicated at the meeting that a deal combining Sprint and T-Mobile could face regulatory difficulties, the people said
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According to the WSJ, Sprint has lined up roughly $31 billion in potential financing and the company is not deterred from pursuing an acquisition.

Japanese carrier Softbank purchased a 70 percent controlling interest in Sprint back in 2012 for roughly $20 billion. T-Mobile is majority owned by German telecom giant Deutsche Telekom.

Previously, AT&T attempted to acquire T-Mobile but government intervention prevented the deal from concluding. Since then, the companies have had a growing feud as they launch ever escalating marketing efforts in an attempt to poach each other's customers.

Article Link: Justice Department Skeptical About Sprint Acquisition of T-Mobile
 
Article Link
https://www.macrumors.com/2014/01/28/doj-sprint-tmobile-acquisition/
OrangeSVTguy

OrangeSVTguy

macrumors 601
Sep 16, 2007
4,127
69
Northeastern Ohio
We need as many as companies as possible. All these acquisitions of bigger companies eating up these little companies isn't leaveing much of a choice for consumers.

This country doesn't need a single Monoply for wireless service.
 
wordoflife

wordoflife

macrumors 604
Jul 6, 2009
7,564
37
Sprint has shown time and time again how incompetent they are. T-Mobile is actually doing well and growing at an extremely fast rate. Would hate to see Sprint get ahold of T-Mobile.

AT&T and Sprint would not be doing some of the things they are doing right now if it were not for T-Mobile's Uncarrier. Verizon will probably follow up soon with something.
 
T

Tiger8

macrumors 68020
May 23, 2011
2,479
649
Shut up, Sprint!

So Sprint cried like a baby when AT&T was to accuire T-Mo, and now they want to accuire T-Mo themselves?

Also, how many incompatible technolgies can Sprint take?

First they accuired Nextell which cost them billions of dollars in loses, then they accuire ClearWire (again, after letting go of it) and they kill it and will be phasing out its WiMax, and now a GSM carrier? Are you kidding me?
 
wordoflife

wordoflife

macrumors 604
Jul 6, 2009
7,564
37
Tiger8 said:
Also, how many incompatible technolgies can Sprint take?

First they accuired Nextell which cost them billions of dollars in loses, then they accuire ClearWire (again, after letting go of it) and they kill it and will be phasing out its WiMax, and now a GSM carrier? Are you kidding me?
Click to expand...

That's Sprint for you.
 
ArtOfWarfare

ArtOfWarfare

macrumors G3
Nov 26, 2007
9,559
6,059
There are two ways to look at this:

Way #1: We currently have four major national carriers. If Sprint buys T-Mobile, we'll only have three.

Way #2: We currently have two major and two minor national carriers. If Sprint buys T-Mobile, we'll have three major national carriers.

AT&T and Verizon are each much larger than Sprint and T-Mobile - I see this as way #2. The question becomes, will Sprint/T-Mobile continue trying as hard to get an edge on AT&T/T-Mobile? I think so. In fact, I think they may even try harder, by pooling their resources together. They'll take the best of each of their plans and put them together to have a plan superior to what either of them have now and leagues better than what AT&T or Verizon has.
 
Plutonius

Plutonius

macrumors G3
Feb 22, 2003
9,032
8,404
New Hampshire, USA
kazmac said:
4 companies are better than three. And I'd hate to see Sprint get T-Mobile.
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The parent company wants to get rid of T-Mobile. It's probably either Sprint or T-Mobile will just break up the company and sell the bandwidth to the big 3. The DoJ can't force the parent company to keep and run T-Mobile if they don't want to especially if the DoJ vetoes anyone who wants to buy it. T-Mobile is going away one way or another. It's just a matter of how and when.
 
R

R0bert

macrumors member
Oct 6, 2005
82
0
Apple should buy Sprint. It would allow them to innovate at the network layer.
It's only $35B so they should grab it.
 
S

SoAnyway

macrumors 6502
May 10, 2011
477
183
Good. This is exactly why regulation is a good thing because it create competition.

The more companies there are in the market, the better for us consumers.
 
Solomani

Solomani

macrumors 601
Sep 25, 2012
4,785
10,477
Slapfish, North Carolina
To imply that "Sprint plans to acquire T-Mobile" is misleading at best.

In reality, it is the gigantic Japanese mega-corporation Softbank (which also owns much of Sprint) that wishes to acquire T-Mobile USA.

By implying the former, Softbank is trying to make this look like an "innocent merger" between 2 small fry carriers, and they are hoping that this is how the US Courts perceive this acquisition.
 
K

koban4max

macrumors 68000
Aug 23, 2011
1,582
0
it doesn't matter if one takes over another company. If all companies are going to sell plans similar to each other..it wouldn't make much difference in who is cheaper or better.
 
69Mustang

69Mustang

macrumors 604
Jan 7, 2014
7,895
15,043
In between a rock and a hard place
ArtOfWarfare said:
There are two ways to look at this:

Way #1: We currently have four major national carriers. If Sprint buys T-Mobile, we'll only have three.

Way #2: We currently have two major and two minor national carriers. If Sprint buys T-Mobile, we'll have three major national carriers.

AT&T and Verizon are each much larger than Sprint and T-Mobile - I see this as way #2. The question becomes, will Sprint/T-Mobile continue trying as hard to get an edge on AT&T/T-Mobile? I think so. In fact, I think they may even try harder, by pooling their resources together. They'll take the best of each of their plans and put them together to have a plan superior to what either of them have now and leagues better than what AT&T or Verizon has.
Click to expand...

They run different networks. At some point a cohesive company has to decide on a direction. Let's build out the CDMA. No, no let's build out the GSM. They can't do both effectively. (maybe all world phones? hmmm) Sprint already screwed the pooch with their Nextel, non-compatible acquisition.

That plan squishing thing you're talking about? Sounds like you're trying to push something beneficial to the consumer. Leagues better sounds a little like less profitable. If the merged company can't find a way to make it profitable, it's dead in the water. The increased marketshare won't mean a thing without the corresponding profits. As we are infamous for touting on MR, "It's the profit that counts."
 
maxwelltech

maxwelltech

macrumors 6502
Dec 29, 2011
423
104
Irvine, CA, USA
DJsteveSD said:
The justice dept doesn't like this merger but they let the AA/US Air one go through. hello higher airline tickets!
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Well there has been four big airline mergers over the last five years already (Northwest-Delta, United-Continental, Southwest-AirTran, and now American-US Airways), and it has been part of the industrial trend over the last few years with so many carriers entering and leaving the market. Remember when AA-US merged they had to give up a large amount of slots in airports, and these slots will be used to make the smaller carriers stand a chance before these merged airlines.
 
W

WallToWallMacs

macrumors regular
Jan 26, 2014
166
0
Tiger8 said:
So Sprint cried like a baby when AT&T was to accuire T-Mo, and now they want to accuire T-Mo themselves?

Also, how many incompatible technolgies can Sprint take?

First they accuired Nextell which cost them billions of dollars in loses, then they accuire ClearWire (again, after letting go of it) and they kill it and will be phasing out its WiMax, and now a GSM carrier? Are you kidding me?
Click to expand...

It is SoftBank who is funding it which all comes down to frequency rights and mobile phone tower locations. If they put LTE on every tower along with back haul upgrades they would pretty much have all of the USA covered and combine that long term with pushing voice to VoIP via LTE they're positioning themselves for the future.
 
M

mj1108

macrumors 6502a
Apr 7, 2007
642
481
California
Even more so than just there being 4 carrieres, the fact that T-Mobile is being a bit of a maverick in actually getting these companies to compete should be a hurdle. If T-Mobile got gobbled up, I'd be afraid of all of the uncarrier stuff going away.
 
K

kenroberts83

macrumors regular
Apr 2, 2012
159
0
Many of your opinions are overly simplistic and ill-informed. If more cell carriers were always better, then why not break AT&T and Verizon into several smaller companies? The reason should be obvious: because the resultant coverage would be horrendous.

We're in a similar situation with T-mobile and Sprint. If you don't live in a major city, you likely wouldn't consider using either carrier. Personally, I considered T-mobile's iPad promotion and then changed my mind after viewing the nearly non-existent coverage in my area (Omaha, NE).

A merged company *could* be better for consumers, if it allows Sprint to ultimately provide wider coverage and faster average speeds. I was actually excited about this merger, because it may enable me to consider a company other than the AT&T/Verizon duopoly.
 
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