updated 05:02 pm EST, Fri December 13, 2013
Number three carrier could gobble up number four
Sprint is working toward a bid to purchase T-Mobile, according to a new report in The Wall Street Journal. The United States' third-largest wireless carrier is reportedly considering offering more than $20 billion for T-Mobile, which sits in fourth place but has been reinvigorated by a number of disruptive "UNcarrier" offerings. Those offerings have given T-Mobile a boost even as Sprint appears to have languished, with drops in subscriber totals and abysmal customer satisfaction ratings.
Sprint's possible bid would likely incur considerable scrutiny and possibly resistance from regulatory bodies in the United States. The move would leave Americans with three major carriers, and the three together would account for a sizable majority of wireless subscribers in the country.
The carrier - which was itself bought by Softbank earlier this year - has not decided whether to tender the offer. At issue is the aforementioned possibility of regulatory resistance. The Justice Department nixed AT&T's $39 billion bid for T-Mobile in 2011 due to antitrust concerns, and Sprint is wary of wasting its time on an effort that could have a similar end.
Executives from both Sprint and T-Mobile have argued that consumers would be well served by a merger between the two entities, as it would allow them the leverage to invest in their networks on a scale to compete with Verizon and AT&T. Combined, they would have a subscriber base of 53 million, still well behind Verizon's 95 million and AT&T's 72 million postpaid customers.
Should Sprint put forward a bid, it would likely see competition from other sizable corporate players. Dish Network which previously tried to buy Sprint, has also expressed interest in the possibility of buying T-Mobile. In mid-November, Dish Network Charlie Ergen said that a bid for the fourth-largest carrier was still on the table.