Will the US telecom market enter a shrinking stage? The third and fourth operators on the market (T-Mobile and Sprint) are merging. For the greater good of the consumers, for employment and to lower the bills. Or so they say.
It is not recorded yet. It must first be validated by shareholders of both companies (that should be easy), then by the US regulatory authorities. This should be more complex: the anti-trust laws are supposed to control market concentrations.
Magic: T-Mobile swallows Sprint, but creates jobs
The announcement is official though and the terms are well known. T-Mobile wants to merge with its rival: Sprint. If the operation gets the go-ahead, the new entity will keep the name T-Mobile. The name Sprint will slowly disappear. Deutsche Telekom, the parent company of T-Mobile, will own 42% of the new group. SoftBank, the parent company of Sprint, will own 27%. The 31% left will be available to a third party.
In this configuration, the US telecom market will encompass three giants: AT&T, Verizon (current leader) and the new T-Mobile. One of the reasons to promote the merger is to counter AT&T and Verizon with scaling savings and synergy. However, both operators claim they will create jobs… Mary Poppins must be behind all this.
Stop the presses: the market shrinks but prices will drop. We promise.
The other part of the T-Mobile/Sprint communication are prices. Don’t laugh, but they pretend the merger and the cut in operators will induce a drop in plan prices. As everyone knows, market shrink means price drops. No, lowering the number of operators will not ease unlawful agreement.
Behold, dear consumers, the 5G is coming and your telecom operators will offer incredible deals! At the best price. Promised. Cross my heart…