Light Reading

What's the Next Mega-Mobile Merger in the US?

Dan Jones
5/1/2013
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Now that T-Mobile USA has succeeded in combining with MetroPCS, what could the next mega-mobile merger in the U.S. be? Well obviously, Sprint has to bring its three-way with SoftBank Mobile and Dish Network Corp. to a happy ending while completing the total take-over of Clearwire LLC next. That's no small order in itself! Verizon Communications Inc., meanwhile, could pay Vodafone Group plc tens of billions to have complete control of its wireless arm. What happens after that, however, is a little bit murkier. One long-term prospect is that Sprint could merge with T-Mobile. Sprint's CEO Dan Hesse didn't rule that out when asked about it in 2012. I don't see that happening any time soon, though. Sprint and T-Mobile each face their own separate network integration challenges ahead with their current or planned partners and those are always more tricky in practice than on paper. Adding another massive network to the mix could stall the whole process. It's even less likely that AT&T Inc. and Verizon Wireless could meld with either Sprint or T-Mobile. The failure of the proposed AT&T/T-Mobile merger in 2011 indicates that the government doesn't presently want to make the U.S. wireless scene any more of a duopoly than it already is. I certainly expect them to span up more small regional carriers though to lock up more 4G bandwidth. The hunt for spectrum is an un-ending process and the big two hold the whip-hand there. One outside possibility is that Google could get into the wireless service provider game. There has certainly been speculation on that in the past. I don't really see the point of Google buying a pure-play wireless carrier. They have got what they needed -- a platform for mobile search revenues -- through the ascendancy of the Android operating system in that area. I could see Google using its money trying to develop alternative high-speed wireless technologies such as white spaces in the future, much like the search giant is trying to push high-speed fiber in the U.S. Whether that's a build or buy situation is not obvious to me at this point. Perhaps you have some thoughts on what's coming next for mobile M&A in the USA? — Dan Jones, Site Editor, Light Reading Mobile

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brianm0122@gmail.com
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brianm0122@gmail.com,
User Rank: Light Beer
6/4/2013 | 7:05:25 PM
re: What's the Next Mega-Mobile Merger in the US?
Everyone here sees the Dish/sprint/clearwire/sofbank as an either/or deal. It could be that Dish is happy with Clearwire, or even just a portion of it. They need some sort of infrastructure to base their network on, and it is possible that Sprint could scrape up a package of towers/spectrum/network from their Clear/sprint/Nextel networks. There is plenty of overlap between the networks in many parts of the country.

The Sprint and Nextel networks pretty much overlapped across the county. If Sprint took the Nextel network, tossed in some Clear/sprint spectrum, towers, Switches, data centers, etc, Dish, could have the start of a very comprehensive network. Add their own spectrum, and maybe some combination of Leap/US cellular/Cspire/others, they could cobble together very nearly nationwide. They are very well-funded, and Charlie Ergen thinks big. What do you think?
Asael Delgado
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Asael Delgado,
User Rank: Light Beer
5/13/2013 | 4:19:19 PM
re: What's the Next Mega-Mobile Merger in the US?
PERFECT! I could not of said it better myself!
lanbrown
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lanbrown,
User Rank: Light Sabre
5/11/2013 | 1:45:55 AM
re: What's the Next Mega-Mobile Merger in the US?
But the big players don't want "those" customers. You are talking low margin customers and those low margin customers would then have access to a much faster network. Their data usage would go up , making those slim margins even slimmer.

Sure the carriers would like the spectrum, but not at that cost. if the Leap/Cricket network is just congested in areas, your net spectrum add is a negative. When users are seeing dial-up speeds, the network is at 100%. if someone could buy Leap/Cricket and just shut the network down, then the spectrum makes sense. The next issue, Leap/Cricket and MetroPCS for the most part are using 5MHz channels whereas the big players are using 10MHz. That doesn't really help the big players unless that spectrum falls right next to what they currently have.

Maybe the answer is that the big players all put money into the hat to buy certain areas to get spectrum that suits them and whatever is leftover they sell?
DanJonesLRMobile
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DanJonesLRMobile,
User Rank: Light Sabre
5/10/2013 | 3:03:50 PM
re: What's the Next Mega-Mobile Merger in the US?
Leap would make sense as additional spectrum for an existing network not as a standalone network.
lanbrown
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lanbrown,
User Rank: Light Sabre
5/10/2013 | 5:19:53 AM
re: What's the Next Mega-Mobile Merger in the US?
Leap has the slowest network out there though. In some areas it could take an hour for a text message or data speeds were that of dial-up. So if someone bought them, what do they get? They get low paying customers and moving them to your network is just going allow them to use more of their unlimited data. I cannot see Verizon interested in them at all. Sprint/Dish/Clear/Soft will all be busy. If Dish doesn't get Sprint, then maybe they will be interested.
brianm0122@gmail.com
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brianm0122@gmail.com,
User Rank: Light Beer
5/7/2013 | 9:25:12 PM
re: What's the Next Mega-Mobile Merger in the US?
I think Sprint fights off Dish for Clear, and DISH has to look around for another carrier to form a core of a nationwide network. U.S. Cellular, Cspire, leap are all candidates.
MordyK
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MordyK,
User Rank: Light Sabre
5/7/2013 | 1:44:44 AM
re: What's the Next Mega-Mobile Merger in the US?
I think T-Mobile will attempt to take out Leap and US Cellular whose spectrum assets align with the MetroPCS assets and largely fill the hole in the MetroPCS national spectrum map puzzle. They pretty much have to wait until they swallow MetroPCS which will be a bit of a challenge but will also be a practice run for other CDMA carriers, something that Verizon has done a few times in the opposite direction..
Matthew Prendergast
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Matthew Prendergast,
User Rank: Light Beer
5/6/2013 | 1:46:04 PM
re: What's the Next Mega-Mobile Merger in the US?
I see softbank and sprint merging just fine. Dish will be mad but will merge with T-mobile, since T-mobile loves advertising there T-mobile tv apps.If Dish and t-mobile do not merge then I think that would leave dish and google to join forces, forcing t-mobile to scoop up regional carriers or until centurylink comes to its senses and buys t-mobile and stops relying on verizon for wireless. There is an offshoot though that after vodafone sells its half to verizon, they will buy t-mobile just to compete in the US markets. Doubtful but possible.
SarahReedy
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SarahReedy,
User Rank: Blogger
5/6/2013 | 1:40:12 PM
re: What's the Next Mega-Mobile Merger in the US?
What about Leap Wireless? It's going to have a real tough time competing, especially now that T-Mobile owns MetroPCS. It's a candidate for acquisition.
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