Sprint, T-Mobile Could Announce a Merger By Month's End (androidpolice.com)

Last month, it was reported that T-Mobile is close to agreeing tentative terms on a deal to merge with Sprint. Now, it appears that negotiations between the two companies are almost complete. Android Police reports: The report claims that Sprint and T-Mobile are putting the finishing touches on the merger, which will likely be announced at the quarterly earnings report at the end of this month. Some of the current discussion topics include Sprint's valuation (estimated to be around $29 billion), the location of the combined company's headquarters, and appointments to the executive management team. The merge is not expected to include a breakup/termination fee, meaning if one company backed out of the deal, there would be no financial penalty. This would align both companies to lobby government regulators for approval without any conflicts of interest. After AT&T called off its buyout of T-Mobile in 2011 due to government opposition, the company paid a $4 billion breakup fee to T-Mobile, which helped strengthen T-Mobile as a competitor. The report notes that while T-Mobile and Sprint's quarterly earnings reports have not been set, T-Mobile's was on October 24 last year, and Sprint's was the next day.

Comments

Bad for consumers

[Anonymous Coward]

Republicans say that competition benefits consumers. Mergers and acquisitions within the same industry reduce competition. Republicans push for unfettered mergers and acquisitions, allowing market consolidation. This hurts consumers. Why do Republicans hate consumers so much?

Re:Bad for consumers

[ShanghaiBill]

It is not clear if this is "bad for consumers". Mergers do not always reduce competition. If a market has one or two dominant companies, then competition can be increased if the "little guys" consolidate to challenge them. Verizon is bigger than Sprint and T-Mobile combined, and AT&T is nearly as big. Cellular is a business where bigness matters more than most because of the cost of infrastructure.

Disclaimer: I am a T-Mobile customer, and I am mostly happy with their service.

Re:Bad for consumers

[PolygamousRanchKid]

If a market has one or two dominant companies, then competition can be increased if the "little guys" consolidate to challenge them.

As an American, who grew up and lived there until the mid-80's, the lack of choice for mobile providers in the US has always baffled me. I went through the years when "Ma Bell" was broken up, and the reasons behind it. Where I live in Europe now, I can click on the search for providers button, and can't swing a dead cat around my head without getting at least five.

And the US has just TWO?

My SIM card is paid for by my employer, and we used to have Deutsche Telekom, which had excellent service. Now we use Vodafone which was apparently a better deal for my employer, but has less-than-the-best service. The PolygamousRanchChick uses O2, because they are dirt cheap . . . but have crappy service. So most folks pick and pay for the quality that they want.

In the US, it seems that the choice is either crappy service from AT&T . . . or crappy service from Verizon.

It's time for Jeff Bezos to step in and buy a mobile provider with a motto of, "We will give you good service, at a reasonable price, and treat you nicely".

I'm guessing the duopoly in the US is due to a much too comfortable relationship between telecom lobbyists and government regulators in the US.

Just having two providers is no choice!

Re:Bad for consumers

[fightinfilipino]

this all comes back to the "last mile" problem. in Europe, governments have much more power and leverage to open up the last mile infrastructure, increasing competition. in the U.S., the corporations have a chokehold on that last mile, and politicians are either reluctant to bite the donation hand that feeds them or are ideologically against such "socialism". idiotic. the EU has the right of it.

Re:Bad for consumers

[Anonymous Coward]

There are actually tens if not hundreds of companies to purchase cellular phone service through in the US at rates much cheaper than the main companies. They are called MVNO's and basically purchase service from the 4 big companies and resell it. I am a fairly light cell phone user and use a company whom I pay on average less than $1 a month. These types of companies don't tend to do a good job of advertising themselves though--most people have never heard of any of them.

But as for the towers themselves, they are all owned by a handful of companies. It's just not econimically feasible for anyone else to enter that market, and try to set up new towers all over the entire country.

Re:Bad for consumers

[SlaveToTheGrind]

Where I live in Europe now, I can click on the search for providers button, and can't swing a dead cat around my head without getting at least five

Actual network operators, or virtual network operators reselling bandwidth on one of the actual networks? Unless this list is way wrong, there are only 3-4 actual network operators in most European countries, essentially the same as the U.S.

And the US has just TWO?

The U.S. currently has four network operators of any significance: AT&T (huge), Verizon (huge), Sprint (medium), and T-Mobile (medium) -- this proposed merger would reduce that to three networks of comparable size. Then there are dozens of mobile virtual network operators that essentially resell bandwidth on one of those four networks (often with limitations on speed, call quality, or what have you).

Re:Bad for consumers

[dcw3]

The U.S. hasn't done shit to stop monopolies, or monopoly like behavior since AT&T was broken up, and the failed attempt at MS. Competition is why even the poor walk around with the latest iPhones and Galaxys. And I doubt you can give any examples of bunch of little guys teaming up. When "little guys" team up, it's more often them selling out for huge profits to some other corporation's Mergers and Acquisitions team so that they can keep Wall Street's quarterly (short sighted) numbers up. No, fewer competitors is bad for consumers...always. Where we frequently get wrapped around the axle is when companies have virtual monopolies (MS was one, Amazon, FB and Google are now). and nobody seems to give a shit.

Axis of Nazi Hitlers

[Anonymous Coward]

German T-Mobile to merge with Japanese Sprint. The Axis Powers together again, this will be good.

Worked great for Nextel-Sprint..oh wait

[blahbooboo]

Sprint killed Nextel, and all the innovation was lost. Not a great merger.

Re:Worked great for Nextel-Sprint..oh wait

[Solandri]

Nextel used iDEN which was a technological dead end. Like GSM, it used TDMA - each phone is assigned a timeslice and they all take turns talking with the tower. This was fine for low-bandwidth applications like voice, but was disastrous for data. If you send data using TDMA, the total bandwidth gets split across all phones equally. Each phone gets its full communications timeslice even if it doesn't need all (or any) of it. And some bandwidth is lost for padding to avoid timeslice overlap due to the finite speed of light.

In contrast, CDMA allows all phones to transmit simultaneously. Each phone is assigned an orthogonal code which allows the tower to tell their transmissions apart - kinda like writing vertically and horizontally on the same sheet of paper. The letters overlap, but the shape of the letters is distinct enough (orthogonal) that you can tell which ones are vertical or horizontal, and you can clearly read both overlapping messages. In CDMA, each phone sees the transmissions of the other phones as noise. And the bandwidth each phone gets is the signal to noise ratio. So bandwidth is instantly allocated automatically between all transmitting phones. If a bunch of phones stop transmitting, the noise floor drops, and the phones which are still transmitting get the bandwidth released by the non-transmitting phones.

GSM threw in the towel within a year and amended the GSM spec to add UMTS for 3G data. UMTS used wideband CDMA for data. Yes that's right. CDMA won the GSM vs CDMA war. This was why CDMA got 3G data about a year before GSM. And why GSM phones could talk and use data at the same time (they had a TDMA radio for voice and a CDMA radio for data, whereas CDMA phones only had a single radio which couldn't do both at once). If Sprint hadn't acquired and subsumed Nextel, Nextel would've run into the same problem as GSM and been forced to either adopt CDMA (same as if they'd merged with Sprint), or hemorrhaged customers due to lack of 3G data until they went bankrupt.

Re:Worked great for Nextel-Sprint..oh wait

[dgatwood]

With frequency bands from 2.3 to 2.4 GHz. and 2.496 to 2.69 GHz, respectively, LTE bands 40 and 41 are essentially on either side of the ISM band, which is from 2.4 to 2.5 GHz.

The poor coverage has nothing to do with microwave ovens and everything to do with higher frequencies being more prone to multipath interference. That's the highest-frequency band that Sprint uses for LTE.

Re:Worked great for Nextel-Sprint..oh wait

[Known Nutter]

Timeslot... not timeslice.

/pendantic

Otherwise, spot on.

Re:Worked great for Nextel-Sprint..oh wait

[_merlin]

That isn't really true. GPRS (the GSM packet data extension) allows somewhat flexible allocation within a single timeslot allowing multiple light users of data to be serviced in a single timeslot (think TCP keep-alives, instant messaging, server hearbeats, interactive SSH sessions, and other low-bandwidth stuff). Managing uplink allocation is somewhat more complex and less efficient. GSM supported simultaneous voice and data provided the network enabled it by doing voice in one timeslot and data in another, using the same radio. However many network operators (e.g. Telstra in Australia, and AT&T in the US) didn't allow this and would kill your GPRS connection when you established a voice call. EDGE used the same channel management as regular GSM but used higher-order modulation (some kind of QAM IIRC) to increase the data rate.

iDEN died mainly because it was a proprietary system from a single vendor (Motorola), so it didn't have the economies of scale that the widely-deployed systems had. It had some interesting functionality like a fast call establishment sequence used for the push-to-talk "walkie-talkie" feature. GSM tried to add an equivalent for this but it never performed as well, and it wasn't popular with the operators. There's no reason iDEN couldn't have been hacked up to support something like GSM's GPRS/EDGE to get usable packet data.

IS95/CDMA2000 CDMA had a number of benefits compared to UMTS W-CDMA. IS95 uses 1.25MHz channels compared to UMTS 5MHz channels (ignoring the IS95 3x mode that used three times the channel bandwidth - this wasn't widely deployed). This means you need to be able to support more than three times as many users per channel before you get the same spectrum efficiency. You also need faster DSPs on the handsets to process the 5MHz baseband signal, which leads to shorter battery life. Allocating code space to give each handset optimal bandwidth and noise level becomes more complex as you have more users on a channel and more code space. Early UMTS cell base hardware didn't have the computational power to do this effectively, so bandwidth was allocated very poorly. This has been mostly mitigated by improvements in DSPs, CPUs and batteries.

CDMA is inherently complex to implement and comes with its own set of problems. One of them is that a distant handset may be able to receive the signal from the base, but not be able to transmit to the base because its signal is swamped by handsets closer to the base. More distant handsets require allocation of more code space to get the same bandwidth as close-by handsets. Very tight synchronisation between handsets and also between base stations is required to keep the signals orthogonal.

LTE isn't actually a CDMA system. It uses orthogonal frequency domain multiple access (OFDMA) to handle multiple simultaneous users on a channel. It's a different technology to TDMA or CDMA with a new set of issues. One notable feature is the cyclic prefix applied to symbols. This gives very high immunity to multi-path reception with delay spread up to the length of the cyclic prefix. But if the multi-path delay spread exceeds the length of the cyclic prefix, it falls over very quickly. CDMA is less immune to multi-path reception with relatively low delay spread, but more immune if the delay spread becomes very high. It's impossible to go through all the implications in a comment here, but one needs to appreciate that this is a big, complex topic, and there are many technical and economic factors at play.

T-Sprint?

[jfdavis668]

Since they use Yellow and Magenta, should they just change their corporate color to Cyan?

Please Stop this Merger

[SmaryJerry]

We don't need fewer options. This will hurt consumers so much.

Re:dejavu

[dgatwood]

That's not entirely true. My Sprint iPhone can roam onto T-Mobile's network just fine (and occasionally does in the very rare spots where T-Mobile has coverage and Sprint doesn't). And even T-Mobile cell phones can use Sprint's LTE network, assuming they support the right bands. They just can't use their 3G network (for lack of a CDMA radio). In urban areas where LTE is readily available, the networks could complement each other nicely.

I still don't like the idea of consolidation, though. We have way too few nationwide cellular networks as it is. We need about ten more, not fewer.

Sprint needs a deal

[spinitch]

Sprint and T-Mobile can beat each other up on the low end or team up and invest in a network that can rival the big 2 plus have economies of scale to offer services at less cost to consumers. This might hurt competition at lower end but should help at mid tier. A deal is not a fore gone conclusion . T-Mobile should not over pay for Sprint with its high debt and less compatible CDMA 3G 1X infra. Sprintâ(TM)s spectrum and not undercutting T-Mobile plus the efficiencies that can be gained reducing overlapping Operating expenditures. Less executives, call centers, and SGA throughout.

Re:Sprint needs a deal

[drinkypoo]

If you tried I bet you could write complete sentences.

They didn't even write those sentences, the "SprintÃ(TM)s" lets us know that's a C&P job.

Bad for America

[Anonymous Coward]

How many of you know that Sprint is owned by the Japanese and the Arabs?

If this merger (more like an acquisition) goes through, T-Mobile will also fall into the hands of the Japanese, and their Arab partners

One by one the American companies been acquired by foreigners, and pretty soon the WH will be pwned too!

Re: Bad for America

[Anonymous Coward]

T-Mobile US is majority-owned by Deutsche Telekom.

Fuck you, FTC.

[Gravis Zero]

First, I highly respect the job of the FTC because it's extremely important. Second, fuck the FTC because those assholes haven't been doing their jobs correctly for decades.

Perhaps it's a leadership problem, maybe they are caving to political pressure, I don't know. What I do know is that they have allowed huge corporations to fuck over the whole nation for waaaaay too long.

Re:dejavu

[dgatwood]

I should also have pointed out that not all phones will necessarily support *every* LTE band of the other carrier, but fortunately, the towers are already smart enough to handle those sorts of allocation difficulties, ensuring that phones don't get assigned to bands that they don't support.