Weekend news! T-Mobile and Sprint announced today that they are merging to create a single company, simply called, T-Mobile. This is the end for Sprint, but combined, the two hope to be a true competitor to Verizon and AT&T and build out a 5G network even quicker.
Throughout the press release sent by T-Mobile and Sprint, they talk about lower costs, greater economies of scale, better network quality, job creation, and that previously mentioned 5G network buildout. The two will use their 2.5GHz (Sprint) and 600MHz (T-Mobile) spectrum to “create the highest capacity mobile network in US history,” with what could be 15x faster speeds “on average” by 2024. Some customers could even see 100x faster speeds than early 4G, the companies suggested.
They’ll push for rural expansion, which would mean opening stores and creating “thousands of new jobs,” possibly delivering another broadband option to those communities, and better competition with Verizon outside of big cities.
This will need regulatory approvals to go through, of course. Should that happen, John Legere will remain on as CEO and the company’s headquarters will remain in Bellevue, Washington. Sprint CEO Marcelo Claure will stay around as a board member of the new company. They hope to close by the first half of 2019.
The combined companies will employ more than 200,000 people and plan to invest some $40 billion into network over the next three years. They hope that forces AT&T, Comcast, and Verizon into doing the same. And this is ultimately the pitch they’ll sell regulators on. It’ll be, “Look, us combined can force our competitors to do bigger things, which is a win-win for all!”
In terms of other details, both boards of directors from T-Mobile and Sprint approved the deal. Deutsche Telekom (T-Mobile) will hold 42% of ownership, while SoftBank (Sprint) will hold 27%.
If you care about none of that stuff, just know that the pitch here is for the combined company, which will be known as T-Mobile, to create jobs, build out a 5G network faster, help fuel competition, and ultimately, reduce prices for you. Should this deal be approved, hold them to that. If you don’t see lower prices, you should call them out until you do.