Does Cricket's deal with Sprint kill a MetroPCS merger chance?

Cricket when they announced big changes to their coverage, plans, and phone lineup. While the plan and phone changes are nice and might draw a few customers their way, the biggest change was the expansion of their coverage. By entering into an MVNO agreement with Sprint, Cricket can now offer service nationwide. It gives them a leg up on the competition, particularly on MetroPCS. For the past three years rumors have swirled that the two companies would merge. Could Cricket’s newfound firepower put those rumors to an end? At FierceWireless, Sue Marek examines the situation. From after it certainly seems like Cricket has positioned itself well. They have a distinct advantage over Metro now, in that they can not only activate accounts in markets that MetroPCS does not reach, but they can also now compete with Metro in previously uncontested markets like New York and Boston. Meanwhile, MetroPCS customers can roam into Cricket territory, but they cannot activate service there. Marek spoke to Technology Business Research analyst John Byrne, who thinks that this should kill the merger rumors.

From a practical perspective, I think that between the voice roaming deal with Sprint from earlier this year and the new data roaming MVNO deal, it means that Leap doesn’t need MetroPCS, either as a roaming partner or as a merger partner. So the long-awaited MetroPCS/Leap deal may never happen.

The agreement comes on a trial basis, so Cricket will need to produce numbers in order to continue. If this fails, it will bode poorly for Cricket’s future. But considering he available phones, plan pricing, and now-nationwide service, I think Cricket will start to gain ground on Metro. Previous iterations of merger rumors had MetroPCS acquiring Cricket. Perhaps if they’re ever revisited we’ll see it the other way around.]]>