T-Mobile and Sprint merger update

On March 7, the FCC (U.S. Federal Communications Commission) stated that it “paused its 180-day informal time clock” on the review of the $26 billion proposed merger between T-Mobile (TMUS) and Sprint (S), according to an FCC document. In addition, the FCC stated that the decision was made after the third and fourth-largest US mobile operators filed “significant additional information regarding their network integration plans for 2019-2021” and other additional information on the merger, which allows for more public input. The review period would resume on April 4 at day 122.

However, US antitrust regulators have expressed concerns about the merger reducing the competition in the US telecommunications space. Other than the merged company, the industry would only include Verizon (VZ) and AT&T (T) as the other major mobile operators. Concerns also included rising prices from wireless service providers and possible job losses after the merger.

Key Updates on the T-Mobile and Sprint Merger

Postpaid phone net additions

Sprint and T-Mobile have defended the merger. They highlighted that the entry of top cable companies like Charter Communications and Comcast into the mobile space shows that there will still be plenty of competition in the wireless market. The companies also argued that the proposed merger could enhance their 5G network scale, boost cost synergies, and improve their competitive position against Verizon and AT&T.

T-Mobile and Sprint both want to get closer to Verizon and AT&T—the market leaders. In the quarter which ended on December 31, T-Mobile added 1 million postpaid phone net customers. Verizon and AT&T added 653,000 and 134,000 postpaid phone net customers, respectively. Sprint lost 26,000 postpaid phone net customers during the same period.

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