The widespread skepticism about the newly proposed merger between Sprint and T-Mobile is unsurprising, the former’s outgoing Chief Executive Officer Marcelo Claure believes, having told Reuters as much in response to a stock market hit both companies experienced this week. Most industry watchers and analysts are giving the $26.5 billion consolidation a 50-50 chance of being completed, citing Washington’s recent antitrust policy enforcement practices that even saw the Department of Justice move against AT&T’s proposed vertical merger with Time Warner which doesn’t take out any competition from the market, whereas a Sprint/T-Mobile tie-up would reduce the number of national wireless carriers in the United States from four to three. Both wireless carriers are still convinced they can complete their consolidation despite such challenges.
Tom Wheeler, former Federal Communications Commission Chairman, recently argued that T-Mobile and Sprint were promising to commercialize 5G on their own just weeks before they announced their merger, with their main pitch being that there’s no other way to ensure swift 5G deployment in the United States and pressure Verizon and AT&T into doing the same under the threat of increased competition created by their smaller rivals uniting. T-Mobile CEO John Legere claimed the company currently has over half a dozen rivals, adding that no single entity in the country can be considered a 5G player that a combined Sprint and T-Mobile would become, though Mr. Wheeler disagreed with that sentiment, having proposed a shared 5G network wherein the federal government is one of the wireless players as an alternative solution that doesn’t take out any more competition from the market and still accelerates stateside 5G deployment.
Mr. Claure will be leaving his CEO post at the end of the month and be succeeded by Sprint CFO Michel Combes, having been elevated to the position of SoftBank Group International CEO and SoftBank Group Corp Chief Operating Officer. T-Mobile and Sprint are hoping to see their merger approved by the end of the first half of 2019 and will continue pursuing their independent 5G buildout projects in the meantime.