No Sprint Bid for T-Mobile US, After All

Sprint will not be makinng a bid to buy T-Mobile US, after all. On Aug. 5, 2014, Sprint said it was abandoning its effort to buy T-Mobile US, because it believes regulators would not approve such a deal.

As some of us have been arguing, even had the acquisition been attempted, and approved, the likely structure of the U.S. mobile market of the U.S. mobile market would have remained at a minimum of four, and possibly five leading national providers.

Some of us also have been arguing that the U.S. market also would remain unstable, based on some classic patterns of market share.

CNBC also reports that CEO Dan Hesse will  be "replaced tomorrow." 

Some wonder what will happen next. Dish Network and Illiad are among the firms that have either said they would be willing to make a bid, or, in Illiad's case, already have made an initial offer to T-Mobile US.

Among the most logical questions is what will happen to T-Mobile US, as it still is believed to be "in play." The equally-important question is what Sprint will do. 

Over the last year, Sprint executives have increasingly been vocal about the need to gain scale faster to compete effectively in the U.S. market, even if a slower growth pattern still was possible without a merger of Sprint and T-Mobile that would create a much-larger number three provider in the U.S. national market.

Sometime in 2014, though, an independent T-Mobile US is likely to pass Sprint, for the first time, as the third-largest U.S. mobile provider, ranked by subscribers. T-Mobile US also has the fastest growth rate of the four national providers. 

Most likely believe there is little chance of a buyer trying to buy Sprint, rather than T-Mobile US, though perhaps that is conceptually possible. So Sprint now will have to execute on a business plan based on operation as an independent company, likely as the smallest U.S. mobile provider.

And though many expected Sprint to launch disruptive attacks on U.S. market structure, that role has been claimed by T-Mobile US. 

And, at least so far, there is not much reason to believe that regulatory opposition will be a key issue for Dish or Illiad. 

Coincidentally, 21st Century Fox also dropped its bid to buy Time Warner on the same day.






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