Would Google Buy Sprint?

from the and-what-would-they-do-with-it? dept

Last month, when Sprint's investors pressured former CEO Gary Forsee to resign, Derek Kerton's post here on Techdirt made some compelling points:
"The disconnect is that investors in Sprint are risk-averse, Blue-chip, dividend seekers. They invested in Sprint when it was a utility company. But Sprint's 'gambit' into WiMAX has taken them way out of the 'utility company' comfort zone -- and the reaction of the investors is as expected. With Xohm, Sprint's risk profile is looking more and more like a big tech firm, say Yahoo or Apple. Today's Sprint needs risk-seeking investors, not fixed-income seekers."
Could a big risk-seeking investor -- who surely sees an opportunity in "big tech" rather than as a "utility" play be coming along? That, at least, is the premise of a blog post from Rich Tehrani kicking off speculation that Google is sniffing around to buy Sprint -- a rumor perhaps accurately called "hare-brained" by Eric Savitz.

While I tend to lean towards Savitz's view of the likelihood of such a deal, there are some nuggets in there that could make this slightly more interesting. Obviously, Google has a tremendous interest in the mobile space these days, believing it's a key part of its continued growth. The company has made plenty of noise about its supposed intention to bid for the 700 MHz spectrum that's coming up for auction. On top of that, it's increasingly looking like Sprint's WiMax plans are in trouble. However, Sprint still controls a huge chunk of 2.5 GHz spectrum that is quite valuable (whether its used for WiMax or some other wireless broadband technology). It's not entirely ridiculous to think that Google has at least kicked the tires on a plan that would involve getting access to that spectrum. It seems like a stretch that Google would want to burden itself with all the additional legacy issues associated with Sprint, but that chunk of spectrum sure must look tempting to a company with billions of dollars on hand, just waiting to be spent.

Filed Under: rumors, wimax, wireless
Companies: google, sprint


Reader Comments

Subscribe: RSS

View by: Time | Thread


  1. identicon
    Joel Coehoorn, 12 Nov 2007 @ 9:20am

    Just buy the spectrum

    Assuming the new Sprint CEO has the same feeling about Sprint's investors, paying a nice dividend would be one way to appease them for a while. But to make that possible, the company needs a windfall of cash. The spectrum they were going to use for WiMax would make that possible, since their plan to use it has evaporated. A telco could always find something else to do with more spectrum, but apparently getting away from this kind of thing is what Sprint's investors want.

    However, I can't see Sprint selling this spectrum to a competitor. Google, on the other hand, might be just the right player. Google can buy the spectrum for it's own ends, which don't likely include direct competition with Sprint. They might even include opening it up and even leasing parts of it back to Sprint at a later date.

Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here



Subscribe to the Techdirt Daily newsletter




Comment Options:

  • Use markdown. Use plain text.
  • Remember name/email/url (set a cookie)

Follow Techdirt
Insider Shop - Show Your Support!

Advertisement
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Advertisement
Report this ad  |  Hide Techdirt ads
Recent Stories
Advertisement
Report this ad  |  Hide Techdirt ads

Close

Email This

This feature is only available to registered users. Register or sign in to use it.