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Sprint will sell off Boost Mobile if merger with T-Mobile is approved

Sprint will sell off Boost Mobile if merger with T-Mobile is approved

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Illustration by Alex Castro / The Verge

Sprint has promised to sell off Boost Mobile, one of its prepaid wireless brands, if its merger with T-Mobile is approved. Both Sprint and T-Mobile operate a number of prepaid subsidiaries, and the Federal Communications Commission was concerned that putting them all under one roof could stifle competition.

The promise was announced this morning along with further commitments about 5G deployment meant to win merger approval. FCC chairman Ajit Pai said he’d recommend approving the Sprint–T-Mobile merger on account of the new commitments.

T-Mobile already has a bigger prepaid company

Sprint disclosed having 8.8 million prepaid customers in its most recent earnings report. The majority of those are likely on Boost Mobile, but the carrier doesn’t break down the exact figures. Some of those customers are also on Virgin Mobile, Assurance Wireless, and Sprint-branded prepaid plans.

It won’t be a huge loss for the combined company, especially given that T-Mobile already has a more successful prepaid brand. T-Mobile reported having 21.1 million prepaid customers in its most recent quarter, most of which are likely on Metro (formerly Metro PCS). Its biggest competition is likely AT&T, which has 17.2 million prepaid customers.

Boost and Metro are two of the largest prepaid carriers in the US, so keeping them apart will offer some added degree of competition. Boost relies on Sprint’s network, though, and that means the brand could become dependent on a competitor for success, unless it’s able to make a deal to use another wireless provider’s network.

T-Mobile CEO John Legere says the combined company will “find a serious, credible, financially capable” buyer for Boost. He also suggests that buyer could cut a deal to have Boost continue to work on the combined Sprint / T-Mobile network.