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PCS Message Board

  • cc012013 cc012013 Oct 11, 2012 6:34 PM Flag

    Sprint should Buy MetroPCS before Making a Play for T-Mobile

    Assume Sprint took out Clearwire and take over by Softbank, the best move next is to buy MetroPCS to avoid future uncertainties of regulation approval.

    It's really a question about how many customers Sprint is willing to lose. If the gov't prefer 4 players instead of 3, do you rather lose 42+ million customers (MetroPCS/Tmobile combined) or the 33 million (Tmobile only)? The answer is obvious.

    Some betting that MetroPCS/Tmobile combine is going to get weaker, but what if they get better? It's going to cost more for Sprint to acquire and it's harder to get approval. More importantly, why gamble when there is a more sure way? Which is to acquire MetroPCS first. Moreever, by taking away MetroPCS, Tmobile's LTE initiative would delay by at least 6-12 months and without the scale, Tmobile is more likely to continue it's downward spiral. That, would give Sprint a better chance of landing Tmobile in the forseeable future.

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    • Softbank wants Clearwire for their global TDD-LTE wide-area mobile network. Softbank is going through Sprint to get to Clearwire but would also need Sprint as the underlining carrier for Clearwire to complete this task.

      The combined spectrum of Clearwire and Sprint’s could exceed 200 MHz and any acquisition/merger beyond that won’t happen for at least 2 years while Softbank-Sprint-Clearwire entity is concentrating on completing the LTE build-out. Even after then, the FCC spectrum capping rule may not allowed Sprint to merge with PCS due to excessive spectrum holding by Sprint.

      • 1 Reply to cj_observer
      • Excessive spectrum is one of the easier problem to solve in a merger, look at what AT&T propose when it wants to merge with Tmobile and how Verizon divest its spectrum in the recent deals. For Sprint, it doesn't lack spectrum, what it lack at the moment are customers that could expand their scale to compete with Verizon and AT&T.

        By signing Sprint, Clearwire is somewhat in Softbank's pocket unless they do something very stupid. MetroPCS on the other hand, Softbank has no control yet and they only has a few months to make a decision. With the timing, speed, and method Softbank is using to acquire Sprint, I don't believe it's a pure coincident to the recently anounced Tmobile/MetroPCS deal.