Skip to main content

Sprint and T-Mobile are reportedly talking about merging, again

Sprint and T-Mobile are reportedly talking about merging, again


It’s back on

Share this story

John Legere 560 stock

The on-again, off-again courtship between telecoms Sprint and T-Mobile is officially back on, with The Wall Street Journal reporting today that the companies have resumed talks of a merger for what is the third time in four years. The companies weren’t able “to find mutually agreeable terms” last fall, when talks ended without an agreement in November. Discussions are at a preliminary phase, the WSJ reports, and so they may still fall apart yet again.

Different this time around, however, is the big antitrust case playing out between the US Justice Department and AT&T, which is trying to push through its acquisition of Time Warner in order to create one of the world’s most powerful telecommunications and entertainment empires. The trial entered its fourth week yesterday with little surprising developments.

AT&T remains the second largest telecom in the US with around 93 million subscribers, behind only Verizon. And while an acquisition of Time Warner wouldn’t necessarily improve AT&T’s telecom business — it’s more about Time Warner’s media properties — the deal would further solidify AT&T as a media behemoth and may make competing with the company in any arena more difficult. AT&T could more deeply integrate its telecom, internet, or media businesses, as it does today by zero-rating its DirecTV Now streaming service for its cell plan subscribers.

If Sprint and T-Mobile merged, they would have a telecom business larger than that of AT&T’s and would help SoftBank and Deutsche Telekom, the respective owners of Sprint and T-Mobile, compete better with the top two US telecoms. But we don’t yet know how the wishy-washy Trump administration, which pushed the Federal Communications Commission to kill neutrality last year and yet opposes the AT&T merger, would view a Sprint and T-Mobile combination if it did proceed beyond preliminary talks. A close eye on the AT&T-Time Warner trial may tell us more.