Sprint Seemingly Shocked That Nobody Wants Them to Kill Off Price-Disruptive and Competitive T-Mobile

Wireless

from the your-surprise-is-somewhat-surprising dept

Roughly two years ago, when fighting AT&T’s ham-fisted acquisition attempt of T-Mobile, Sprint lobbyists and lawyers were busy telling anybody who would listen that the United States wireless industry isn’t truly competitive unless you’ve got four distinct companies competing. That’s something that United States regulators have generally agreed upon, especially given the massive size and power of AT&T and Verizon Wireless, and their domination of both the retail and special access markets. Fast forward two years after the FCC and DOJ blocked AT&T’s attempted acquisition, and those opinions appear to have been justified by T-Mobile’s sudden resurgence.

The company has not only become great entertainment via snarky CEO Tweets and amusingly mocking carriers like AT&T at every opportunity, but their price disruption has been a truly welcome thorn in the side of larger carriers. From T-Mobile’s free international roaming data offer to their war on long-term contracts, the company is leeching customers from AT&T in real price competition, a rarity for United States telecom markets.

Enter Sprint, who now owned by acquisition-hungry Japanese carrier Softbank, is eager to obliterate all of this progress with a T-Mobile acquisition of their own. Regulators have made it clear for years they want four competitors, and every meeting Sprint and SoftBank have had so far has resulted in regulators clearly expressing doubt at the consumer benefits of such a deal. Consumers too have made it clear they loathe the idea as well, given that Sprint has fallen to last place in customer satisfaction rankings and last place in most LTE network speed and latency tests. As such, it’s rather curious to see Sprint and SoftBank executives “surprised” this week by the cold shoulder they continue to get from regulators (Wall Street Journal, reg. required):

Sprint Chairman Masayoshi Son and Chief Executive Dan Hesse, who met with officials at the Justice Department and the Federal Communications Commission in Washington in recent weeks, always knew a deal would be a tough sell, the people said. But the men were surprised by the level of opposition and its very public nature, one of the people said.

They really shouldn’t be. Trying to acquire the wireless industry’s sweetheart just as they’re gaining headlines for being disruptive? Two years after arguing about the sanctity of maintaining four competitors? Sprint has argued that combining with T-Mobile will make a stronger third competitor to AT&T and Verizon Wireless, though telecom consolidation often doesn’t work that way, and Sprint has shown little to no ability to mirror T-Mobile’s price aggression and consumer-friendly policies (like cell unlocking) in recent years. Though not without problems of its own, the FCC and DOJ will also likely prefer T-Mobile get acquired by someone like Dish in order to retain four distinct competitors. It seems like Sprint might want to save everybody involved a lot of time and money, and for the moment focus on learning to properly run the network they already own.

Filed Under: competition, doj, fcc
Companies: at&t, spring, t-mobile, verizon