Sprint has ‘concerns’ about the AT&T and T-Mobile merger
Sprint Nextel Corp. CEO Dan Hesse said Tuesday that he’s concerned that AT&T Inc.’s deal to buy T-Mobile USA would hurt his company and the industry, as the biggest two players strengthen their dominance.
The $39 billion deal was announced Sunday, but is expected to take more than a year to close, after scrutiny by regulators.
AT&T and Verizon Wireless already have two-thirds of U.S. wireless subscribers, and would have three-quarters if the deal goes through.
“I do have concerns that it would stifle innovation and too much power would be in the hands of two,” Hesse said in a panel discussion at cellphone conference in Orlando, Fla., monitored by webcast.
The head of Verizon Wireless, Dan Mead, was asked on the same panel whether he had a stand on the proposed deal.
“We’re certainly very interested in what’s going on,” he said.
T-Mobile’s CEO, Philipp Humm, did not appear at the panel as scheduled.
Sprint, the No. 3 carrier, has been struggling for years due to the troubled acquisition of Nextel. Last year, its subscriber numbers started improving, but it still has a hard time luring high-paying subscribers from AT&T and Verizon, both of which now sell the popular iPhone. T-Mobile has the same problem.
AT&T’s agreement to buy T-Mobile, the No. 4 carrier, came as a surprise: media reports had previously pegged Sprint and T-Mobile as likely to combine their businesses. But AT&T was able to offer T-Mobile’s parent company, Germany’s Deutsche Telekom AG, much more.
The deal leaves Sprint “somewhat out in the cold,” said Barclays Capital analyst James Ratcliffe.
It’s good to hear this from Sprint. But with all the influence big money has bought on both sides of the aisle of the government I’m sure this deal will be approved. Much like the NBC/Comcast deal.