Four Days. All was right in the cellular world for four days. On Monday I told you that Softbank, the parent company of Sprint, was giving up on plans to merge with T-Mobile. Now The Verge has to come and ruin it, four days later, with word that the CEOs of T-Mobile and Sprint are still talking. So, that means there’s still a chance that the two companies could still merge, which as I’ve said so many times would mean the end of both in my opinion.
There has to be something here I’m missing. I can not for the life of me understand why T-Mobile, a worthy competitor whose technologies align closely with AT&T, would choose to court Sprint, a company held together by so much oddball technology that you have to wonder how their phones even work at all. (In fairness, I admit they do.) I’ve talked about Sprint before many times, notably here here and here. They have an almost supernatural ability to find the technologies that the rest of the cellular world don’t want, and jump into them with both feet. Remember their disastrous 4G implementation from years back, that killed the battery after 20 minutes of use? Or perhaps you’re still a little on edge from the idea that those chirpy Nextel phones might be coming back? I know I am.
So with such a sad story of failed tech, what could possibly be driving T-Mobile to the table? The only thing I can think of is that they know they’ve pushed the FCC too hard already. They’ve flaunted rule after rule and maybe they’re looking for a way to get back to the straight and narrow. Going through FCC approval for a merger would allow the FCC to become the bad guys, telling CEO John Legere that he can’t give away free Netflix, he can’t let people stream music for free, and he can’t do half a dozen other things that probably break FCC rules. Even though it’s clear that FCC chair Ajit Pai is in the pockets of Big Cellular, there have to be some things he just won’t tolerate. This might be a way for the company to save face.
Another possibility is that the German government, who doesn’t terribly care for our government right now, doesn’t want anything to do with the US telecommunications market. T-Mobile is owned by Deutsche Telekom, a private company that is roughly 37% owned by the German government, and was at one point part of the German government. T-Mobile’s German owners may be so anxious to walk away from our cell system that they’ll do anything, even give away a smart, innovative company to the hands of Sprint who will no doubt bollocks it up completely. Remember that the FCC is part of the Executive Branch, and the head of the Executive Branch is the President of the United States. Pretty fair to say he’s not the most popular person in Berlin right now.
Whatever the hidden reason, it seems like we’re not done with this after all. It looks like we’re in for another long slog filled with regulatory intrigue. Are you all ready? I’m sure not.