After a year and a bit of talking, not talking, talking again, not talking again, and finally talking, Sprint and T-Mobile have agreed to merge as one company known as T-Mobile. The $26.5 billion all stock transaction still has to be approved by the Federal Communications Commission (FCC) here in the United States but it is likely to happen. The new merged company will put serious pressure on the two biggest mobile carriers here in the US, AT&T and Verizon, as the new company will be focused on delivering 5G.
“This combination will create a fierce competitor with the network scale to deliver more for consumers and businesses in the form of lower prices, more innovation, and a second-to-none network experience – and do it all so much faster than either company could on its own,” said John Legere. “As industry lines blur and we enter the 5G era, consumers and businesses need a company with the disruptive culture and capabilities to force positive change on their behalf.”
The merged company is expected to be a boon for consumers too. It is likely that plans will drop for existing Sprint customers as the companies come together over the course of 2018.
The announcement on the Sprint site made it clear that the focus of the merged company is 5G and the creation of jobs associated with the next generation mobile network. It also made it clear that the company believes the 5G efforts here in the US should be led by a US company, likely a nod to the current US government which is increasingly putting pressure on Chinese companies in the US market, particularly around 5G development.
Only the combined company will have the network capacity required to quickly create a broad and deep 5G nationwide network in the critical first years of the 5G innovation cycle – the years that will determine if American firms lead or follow in the 5G digital economy. With Sprint’s expansive 2.5 GHz spectrum, T-Mobile’s nationwide 600 MHz spectrum, and other combined assets, the New T-Mobile plans to create the highest capacity mobile network in U.S. history. Compared to T-Mobile’s network today, the combined company’s network is expected to deliver 15x faster speeds on average nationwide by 2024, with many customers experiencing up to 100x faster speeds than early 4G.
Regulators still have to approve the deal and it is likely going to take months before we truly see an all new T-Mobile in the market. But, when it does happen, they will be a significant force in the mobile and 5G networks space here in the US.
