Going Sprobile? Sprint and T-Mobile Merger in the Works

Share this content:

Keep your friends close—but merge with your enemies. That seems to be the thinking behind the news that Sprint is set to acquire rival T-Mobile for $32 billion.


Photo credit: Brendan McDermid, Reuters (modified)

This isn't T-Mobile's first time at the merger rodeo. Back in 2011 AT&T made a bid to bag Big Pink for $39 billion—although the deal never actually went down. The Department of Justice ultimately blocked the marriage in an antitrust lawsuit, basically calling the doomed merger an unholy union that would result in “higher prices, fewer choices, and lower quality products.”

Just a few years later T-Mobile is at a similar crossroads, this time being asked to walk down the aisle with Sprint in a merger that would see the latter acquire its long-time rival for a reported $32 billion.

The big question now—other than what to call the thing; Bloomberg cheekily suggested Sprobile as an option—is what the merger will mean for consumers in terms of coverage area, services, and prices. Some analysts and regulators are a bit skeptical.

So, why are they doing it?

It seems pretty clear that Sprint is looking to increase its market share against formidable competitors. Verizon and AT&T each claim a large percentage of market share. Sprint and T-Mobile together might have an easier time attracting subscribers and building out its combined network, while also saving on operating costs.

T-Mobile has really ramped up its marketing recently with the “Un-carrier” plan, which allows subscribers to upgrade without signing long, binding contracts, offering to pay early termination fees for people who wanted to switch from AT&T, Sprint, or Verizon.

But some analysts are saying that to stay competitive, the merged company (let's just call it Sprin-T), will have to slash its prices, which could have a serious impact on the bottom line.

It's also speculated that if the deal goes through, T-Mobile's notoriously wacky, hot pink-obsessed President and CEO John Legere will helm the combined company—giving him more power to pull the kind of madcap publicity stunts he's become known for. Remember when he crashed that AT&T party back in January?

Although T-Mobile and Sprint reportedly won't be announcing anything official until July—if DC lets the deal go through—Twitter's talking about it now:

close

Next Article in Marketing Strategy

Sign up to our newsletters

Company of the Week

Brightcove is the world's leading video platform. The most innovative and respected brands confidently rely on Brightcove to solve their most demanding communication challenges because of the unmatched performance and flexibility of our platform, our global scale and reliability, and our award-winning service. With thousands of customers and an industry-leading suite of cloud video products, Brightcove enables customers to drive compelling business results.

Find out more here »

Career Center

Check out hundreds of exciting professional opportunities available on DMN's Career Center.  
Explore careers in digital marketing, sales, eCommerce, marketing communications, IT, data strategies, and much more. And don't forget to update your resume so employers can contact you privately about job opportunities.

>>Click Here

Relive the 2017 Marketing Hall of Femme

Click the image above