Sprint and T-Mobile Say They'll Combine, Keeping T-Mobile Name, Leadership

Sprint and T-Mobile agreed to combine in a deal that would see the resulting wireless carrier take the T-Mobile name and be under some of that company's leadership. Foes of consolidation are likely to oppose the deal at the FCC and perhaps at DOJ, too, they told us Sunday immediately after the transaction was disclosed. The companies said in a statement that joining would help them roll out 5G: "Neither company standing alone can create a nationwide 5G network with the breadth and depth required to fuel the next wave of mobile Internet innovation in the U.S. and answer competitive challenges from abroad."

The transaction "represents a total implied enterprise value of approximately $59 billion" for Sprint, the companies said, and the "New T-Mobile" will be based in Bellevue, Washington, where T-Mobile US is headquartered, with a second headquarters in Overland Park, Kansas, where Sprint now is based, they said. T-Mobile US CEO John Legere would keep that title at the combined company, with T-Mobile Chief Operating Officer Mike Sievert as president-COO. T-Mobile US Chairman Tim Höttges would also keep that job, with the board including SoftBank Chairman-CEO Masayoshi Son and Marcelo Claure, current CEO of Sprint.

“We intend to bring ... competitive disruption as we look to build the world’s best 5G network," which will include "rural America," said Claure. The New T-Mobile "plans to create the highest capacity mobile network in U.S. history," the merging carriers said. "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." The combined carriers would invest up to $40 billion in new network and business in the first three years, 46 percent more than they spent in the past three years, they said.

Foes of such consolidation have opposed shrinking the number of nationwide U.S. wireless carriers to three from four. “This isn’t a case of going from 4 to 3 wireless companies," said Legere. "There are now at least 7 or 8 big competitors in this converging market. And in 5G, we’ll go from 0 to 1."

Free Press opposes this transaction and likely will make filings to that effect at the FCC, Policy Director Matt Wood told us. The "merger should and will face major antitrust hurdles," the group said Saturday, ahead of the announcement. "This deal must be blocked," said Gigi Sohn, Georgetown Law Institute for Technology Law & Policy distinguished fellow.

"This will receive vociferous opposition from the public interest community and Justice will be very, very skeptical," said Andrew Schwartzman, a senior counselor at Georgetown Law's Institute for Public Representation, in a phone interview. "Public interest groups will have serious problems with this transaction."

Company representatives didn't comment right away on such concerns, as executives were discussing the deal in a call that will be available for replay. Pro-consolidation voices didn't comment right away.