T-Mobile moots potential Sprint, cableco foursome - Mobile World Live

T-Mobile moots potential Sprint, cableco foursome

19 MAY 2017
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Braxton Carter, T-Mobile US’ CFO, believes there is “a huge prize” on offer in merging with rival Sprint, and revealed broader ambitions about a potential four way coalition with cable rivals Comcast and Charter.

Carter, speaking at a conference in New York, said it was no longer a question of if talks with Sprint will commence as he spoke of the potential advantages and synergies of combining the two players, which he believes would only add to T-Mobile US’ recent growth.

He said the two companies could do “amazing things”, particularly around 5G, by combining Sprint’s “treasure trove” of 2.5GHz spectrum with T-Mobile US’ dense network.

“Of course the talks (with Sprint) are going to happen,” he said, adding: “The benefits of having that scale has been widely reported in the press. We’ve talked about the benefits of organic scale, and that’s changed the financial trajectory of our company. But, by truly creating a third scaled national competitor, you can achieve the margins, and leverage the costs that both AT&T and Verizon benefit from.

Indeed, Bloomberg recently reported informal talks between executives from Sprint, its parent SoftBank, and T-Mobile owner Deutsche Telekom are already underway.

Foursome
However, Carter and Mike Sievert, T-Mobile US’ COO who was also presenting at the conference, suggested the company may not stop with Sprint, should a deal emerge, as they attempt to “turbocharge” their challenger position.

Both executives addressed new competition in mobile coming from the country’s cable players, specifically Comcast and Charter (which recently struck a mobile partnership), and said there was added opportunity for potential partnerships in this area, particularly in bolstering convergence offerings.

“A lot of things have been batted around that do have a lot of industrial logic and does get us pretty excited,” said Sievert: “Could there be an advantage by turbocharging our challenger position that we have in the market with increased capabilities from potential partners, by combining or acquiring in some way?

Carter continued: “It’s still a bit early for cable. But, what about a tie-up between Sprint, T-Mobile, and a coalition of Comcast and Charter? Imagine the value that would create,” he said.

Walk before running
Despite the potential of a four way tie-up, it is clear talks with Sprint would be first up on the agenda.

The deal, mooted in the past, has fallen down due to regulatory hurdles related to competition concerns.

Carter believes the recent entrance of cable players into mobile could mean those fears have now been allayed.

“There are more than four players in the market today, and that could change the dynamics of how you look at this from a regulatory standpoint,” he added.

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Kavit Majithia

Kavit joined Mobile World Live in May 2015 as Content Editor. He started his journalism career at the Press Association before joining Euromoney’s graduate scheme in April 2010. Read More >>

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