Consumers win as Sprint, T-Mobile call off merger

This article is more than 12 months old

Nov 06, 2017 06:00 am

SAN FRANCISCO/NEW YORK Sprint Corp and T-Mobile US Inc said they have called off merger talks to create a stronger US wireless company, leaving No. 4 provider Sprint to engineer a turnaround on its own.

The announcement marks the latest failed attempt to combine the third- and fourth-largest US wireless carriers, as Sprint parent SoftBank Group Corp and T-Mobile parent Deutsche Telekom AG, show reluctance to part with too much of their US telecom assets.

A combined company would have had more than 130 million US subscribers, behind Verizon Communications Inc and AT&T Inc.

The failed merger could also help keep wireless prices low as all four providers have been heavily discounting their mobile phone plans in a battle for consumers.

"Consumers are better off without the merger because Sprint and T-Mobile will continue to compete fiercely for budget-conscious customers," said Mr Erik Gordon, a Ross School of Business professor at the University of Michigan.

The companies' unusual step of making a joint announcement on the cancelled negotiations could indicate they still recognise the merits of a merger, keeping the door open for potential future talks. - REUTERS