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Fwd: T-Mobile and Sprint are now poised to take on Verizon and AT&T

Email sent: May 1, 2018 4:05 pm

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T-Mobile and Sprint reached an agreement on Sunday to merge under a new combined entity that will take the name T-Mobile.

This is the third time in four years that the telecoms have explored the idea of joining forces, but this is the furthest they've come to making the merger a reality.

The combined firm will be better positioned to take on Verizon and AT&T in both customer base and value, while also enabling scale of new technology.

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  • Merging will give the newly formed company a subscriber share comparable to Verizons and AT&Ts. The combined company will have a subscriber base of 127 million customers, inching closer to Verizons 150 million and AT&Ts 141 million, according to Strategy Analytics. This will make the new T-Mobile a more formidable competitor to the top two US telecoms.

  • T-Mobile and Sprint will be able to leverage their resources to offer lower prices for subscribers. This will help the combined firm attract existing Verizon and AT&T subscribers, considering both AT&T and Verizon are ranked low in terms of value for cost, largely as a result of their expensive plans, according to exclusive data from Business Insider Intelligence's Digital Telecom Consumer survey.

  • T-Mobile and Sprint will be able to pool their resources for 5G network development, an effort the individual networks were lacking the resources to lead. The new company will be able to leverage wider spectrum holdings and infrastructure to lead 5G development in the US and globally.

  • The firm will be able to scale its IoT network, and catch up to Verizons and AT&Ts early lead. merging could help the carrier access the resources needed to quickly scale a widespread IoT-specific network and pose as a significant threat to Verizon and AT&T. This is important, as Business Insider Intelligence forecasts more than 55 billion IoT devices installed around the world by 2025.

However, the carriers agreed to the merger without consulting the US antitrust and telecommunications regulators, something we think could inhibit the merger for several reasons.

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