T-Mobile USA's parent company, Deutsche Telekom, may have to work out a union with Sprint Nextel now that the deal with AT&T is off the table. The telecommunications saga is taking another turn, with the news that T-Mobile is now turning to Sprint for a possible union.
Deutsche Telekom's chief executive officer Rene Obermann has lost a lot of time and will now have to invest in the U.S. market or find a new way to exit the country, an option analysts regard as unlikely.
Deutsche Telekom has limited choices: either it can invest in expanding T-Mobile's network or it can merge with another company. Now that AT&T is out of the running, Sprint has become an option. This isn't a new revelation. Deutsche Telekom had considered selling to Sprint before it fully committed to AT&T.
Sprint has positioned itself well. "They will emerge from this with their reputation as a customer-driven company intact and shinier than ever," said Tech Crunch's Devin Coldewey.
A victory for Sprint. Perhaps the biggest reason to celebrate is a potential to give Verizon and AT&T real competition with a T-Mobile-Sprint merger.
Sprint announced plans to switch to the faster LTE standard but has to use debt financing to build out , not practical . T-Mobile USA, lacks the spectrum or funding to build its own LTE network for the moment and is relying on pushing the limits of an older technology called HSPA+. Sprint and T_Mobile both have the same problem , no future . Sprint has one option , pre-arranged bankruptcy , buy out clearwire and build out . Long clearwire , short sprint = Smart Money