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Sprint rumored in talks to buy T-Mobile USA

updated 09:55 am EST, Tue March 8, 2011

Sprint talking buyout of T-Mobile US division

Sprint has been negotiating with Deutsche Telekom to buy T-Mobile USA in what would be a major shakeup of the US Cellular industry, sources alleged on Tuesday. The discussions hae been cast as "on and off" due to a dispute over how much T-Mobile would be worth, but the pursuit has raised the prospect of DT having a formal stake in the resulting union. The German company would own about half of the unified firm in this strategy, Bloomberg heard.

T-Mobile in a response didn't confirm or deny the talks with Sprint but acknowledge that it could sell all or some of T-Mobile. The company has also also acknowledged that it was considering a deal with Clearwire for spectrum as it moves into 4G. Sprint chose not to comment.

A union between the two would be an attempt to stem bleeding at both carriers. T-Mobile has swung back to losing customers and saw many of its gains shrink in recent years. Sprint has finally added postpaid subscribers after years of losses but is still losing hundreds of millions of dollars per quarter. The blame in many cases has been put on their respective lacks of true halo devices, such as the iPhone or Droid X.

Uniting the two would pose technical challenges around the network. Sprint would likely switch to GSM to get T-Mobile's better world roaming but would have to upgrade thousands of cell sites. It might also eventually phase out its WiMAX network since T-Mobile is moving to 42Mbps and eventually 84Mbps HSPA+, either of which can easily outrun WiMAX. Overhauls as part of Sprint's Network Vision project have made this easier, since they would let Sprint keep its CDMA and WiMAX as long as necessary while it added GSM.

T-Mobile would also have the option of adding frequencies to its 3G support and might have an opportunity to use the more popular 1,900MHz band, which AT&T also uses on some parts of its network. The move could give it access to the iPhone and a much wider array of devices without having to arrange for custom hardware as it does today. T-Mobile has been hinting at negotiating for the iPhone but has remained silent on how it was coming along, if at all.



By Electronista Staff
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Comments

  1. lshaner

    Fresh-Faced Recruit

    Joined: Aug 2010

    +8

    No wonder they are losing money!

    Why is it that when Sprint seeks to merge with a competing company it is always the one with the INCOMPATIBLE technology? Didn't they learn ANYTHING from the Nextel acquisition?
    With such MORONICALLY bad business+technology decisions, Sprint DESERVES to go out of business.

  1. Mr. Strat

    Junior Member

    Joined: Jan 2002

    -7

    Not sure

    As a TMO customer, I'm not sure that this is a great idea. I guess time will tell.

    The iPhone - well, I lusted after one for some time, but the iPhone/iPod/iPad are just too much of a PITA to get stuff in an out of them compared to Android.

  1. nat

    Junior Member

    Joined: Mar 2002

    +3

    mr. strat

    really. since you only lusted how would you know? do you have experience with it or just lust?

  1. Joe05

    Fresh-Faced Recruit

    Joined: Nov 2010

    -3

    Sprint

    Sprint will not switch to GSM, They will continue with CDMA which as advantages over GSM, Sprint had commented that it may eventually switch to LTE with little effort since it would for the most part be a software upgrade and not much else on its network.

    Verizon has world phones that run on its CDMA network and can switch to GSM for overseas trips.

    No need for a full network conversion.

  1. Data holmes

    Fresh-Faced Recruit

    Joined: Mar 2011

    +3

    Joe05

    There has been some speculation that Sprint has intended to go LTE all along, using WiMax as a jumping off point to get out of CDMA. There has also been a lot of matiance work being done at there existing cell sites over the last two or so years.

    I have come to think that WiMax is a cover. It has allowed them to do a massive network upgrade/build without pulling a lot of competitive attention from Big V and AT&T. And, with the WiMax marketing they get name association with "4g", they get some income out of the partial upgraded network, and give them some "field experience" with the effect of "4g" data networks and usage effects on their back end before they go LTE live on the whole system.

    If they did buy/merge with T-Mobile that would offer them a GSM backbone option, which could leave them a GSM backbone network as well as a CDMA one. One of their partners in the whole WiMax endevor was making a chip, and was the only one making it if I remember correctly, which would be able to do CDMA, GSM, WiMax, and LTE.

    Think about it. An LTE phone which could use either GSM or CDMA as a fall back. A single phone which will work not only on both major 3G networks, but also both major 4g networks used globally. The first true "4g world phone".


    Also, partnering up with T-M's parent could open up the possibility of free roaming on it's international networks, and vise versa for DT's european customers while in the US.

  1. Jeronimo2000

    Forum Regular

    Joined: Aug 2001

    +3

    @ Mr. Strat

    I don't know how you came to the conclusion that it's a "PITA to get stuff in an out" of the iPhone, but I suggest you have another look. I have no problem, let alone pain (anywhere), to get data onto my iPhone and back from it, using Dropbox, Phone View, and of course iTunes. Most of the time I just mount my iPhone like any other network volume (there's a couple of apps that let you do that) and transfer stuff via the Finder.

    Where's the problem? :)

  1. PTPro225

    Fresh-Faced Recruit

    Joined: Mar 2010

    +3

    T-Mobile USA = $0

    "The discussions hae (sic) been cast as "on and off" due to a dispute over how much T-Mobile would be worth,..."

    It's worth nothing. Having worked there, I can say that this company has based most of its business model around its marketing, e.g. being hip, cool, and trendy (e.g. Paris Hilton). What a joke. To all T-Mobile USA customers: Abandon this sinking (and stinking) ship.

  1. macman72

    Fresh-Faced Recruit

    Joined: Dec 2010

    +1

    I prefer Deutsche Telekom Buying Sprint if they sw

    One of the rumors that I've heard and would prefer to see is that if once Sprint decides to change their 4G from WiMaxx to LTE, once LTE is in place, Deutsche Telekom would buy Sprint. Hopefully, the change in the type of networks doesn't take longer than the switch from TDMA to GSM when AT&T and Cingular merged. Sprint right now is considering the switch; and they have often said that switching from WiMaxx to LTE is not difficult. With this claim and the rumor of Deutsche Telekom buying them if they go to LTE, this looks very profitable with T-Mobile's USA prices and customer support. Consumer Reports has always ranked them Number 2 in both performance and customer service since 2003.

  1. testudo

    Forum Regular

    Joined: Aug 2001

    0

    Re: @ Mr. Strat

    I have no problem, let alone pain (anywhere), to get data onto my iPhone and back from it, using Dropbox, Phone View, and of course iTunes.

    Except Phone View isn't an 'officially blessed app' and could cause issues at any time (since Apple doesn't sanction adding files directly to the phone, just like music).

    Where's the problem? :)

    Well, I'd like to be able to find a file on the internet and be able to download it to dropbox. How do I do that?

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