Industry News

T-Mobile, Sprint agree on USD 26 Billion Merger

T-Mobile, Sprint Merger

T-Mobile and Sprint Corp have recently agreed on a USD 26 Billion all-stock deal. The merger between the third and the fourth largest telecom giants is expected to give US tech lead over China in terms of 5G Network preparedness.

United States: America’s leading mobile carriers, T-Mobile US and Sprint Corp have agreed on a $26 billion, all-stock deal. The telecom giants believe that the merger would open thousands of jobs and aid the United States in 5G network preparedness.

The agreement has finally completed after four years of on-and-off talks between the two US wireless carrier giants. The merger will pave the way for creation of a company with 127 million customers, and would thus enable stiffer competition to the top two wireless players, Verizon Communications and AT&T.

According to the Chief Executive of T-Mobile, who would also head the proposed merged company, the deal is expected to create the highest-capacity US network, lower the prices, create new jobs and improve the service in rural areas. It will also drive the other companies to accelerate their investments so as to meet the competition.

The company will be investing $40 billion over the next three years for upgrading the current networks to accommodate the next generation 5G wireless technology. 5G technology is projected to have enough speed to self-driving cars and power drones.

As per T-Mobile and Sprint, the deal is expected to complete by the first half of 2019 despite the intense US regulatory scrutiny. The companies are however expecting US regulators would see the benefits of the deal. The Federal Communications Commission Chairman will grant the regulatory approval to the deal if they feel it is in the public interest.

Centre for Information Technology and Architecture (CTIA), has ranked China and South Korea ahead of the United States in 5G readiness. The Chinese government has actively been preparing itself for 5G deployment. The Government has launched a plan targeting 5G distribution by 2020, with three telecom companies committed to the timeline.

Verizon and AT&T are way ahead of T-Mobile and Sprint in upgrading their existing network to accommodate the wireless 5G technology. However, the companies still hope the deal will enable them to participate in auction for spectrum to develop 5G and if the merger prevents the companies from participating, they companies might request a waiver.

According to TechSci Research, the merger between T-Mobile and Sprint would open numerous opportunities for the Telecom sector in the US. The deal is expected to lower the price of 5G networks, create plenty of jobs and it also aims to improve the network service in rural areas. Moreover, the merger will give stiff competition to the top two telecom providers in the US - Verizon and AT&T and drive them to improve and innovate their services. TechSci Research predicts that the merger would act as a driver for Global Telecom Cloud Market. Growing focus of telecom companies towards providing content delivery, unified communications and collaboration, is expected to drive the growth of Telecom Cloud market in the coming years.

According to the recently published report by TechSci Research, Global Telecom Cloud Market, By Type (Services & Solutions), By End User (BFSI, Media & Entertainment, etc.), By Application (Billing & Provisioning, Traffic Management, etc.), By Region, Competition Forecast & Opportunities, 2012 – 2022”, Global telecom cloud market stood at $ 11.05 billion in 2016, and is forecast to exhibit a CAGR of over 19%, in value terms, during 2017-2022, to reach $ 38.54 billion by 2022, on back of growing need to minimize operational and administrational costs by telecom companies. Increasing deployment in BFSI sector and rising demand from media & entertainment industry is channelizing demand for telecom cloud across the globe. Unified Communication and Collaboration is gaining immense popularity among telecom service providers to offer better and efficient services. Demand for Communication Defined Network services is also growing across the globe due to increasing need for responding quickly to user queries.

Please follow our LinkedIn and Twitter pages to get live updates on market research insights and analysis.

Relevant Reports

Relevant News