In U.S. and France, Mobile Operator Consolidation Seems Likely

T-Mobile COO Jim Alling said that there could be consolidation in the U.S. mobile market that reduces the number of major U.S. carriers to three. Lots of observers have been saying that for years, and similar talk also is happening in the French mobile market.

In the meantime, though, T-Mobile USA is likely to seek acquisitions of its own to bulk up, as it is trying to do by buying MetroPCS. 

Ailing doesn't predict an immediate consolidation. He  says that such a move is possible now and is "likely in the long term." But lots of observers think the Softbank takeover of Sprint will eventually lead to a merger between Sprint and T-Mobile USA as well. 

In most markets, there are about three to four leading providers. Huge fixed costs explain why the number of facilities-based access providers seems always to be a small number, no matter what regulatory framework is employed, economists at the Phoenix Center for Advanced Legal and Economic Policy Studies  have argued. 

In fact, the starting point for analysis should always be that there were be only a few facilities-based providers of any communications or video service, notably in the terrestrial facilities business, and especially when referring to networks using some form of wired access, Phoenix Center researchers say. 



At least in part, gross revenue is only part of the problem for a market with four leading contestants. Profit margin might be the bigger issue.