Is this the end? Is this finally a MetroPCS-Leap merger?
Cricket hired Goldman Sachs to help advise it on strategic maneuvers. Everyone who follows the industry assumed that this meant a possible merger with MetroPCS. Problem is, everyone who follows the industry has thought this for years, and that hasn’t brought it any closer to fruition. Now we’ve learned that Metro has hired JPMorgan Chase & Co. and Credit Suisse Group for its own advisement. Could this finally be it? Could the two services realize that they cannot survive separately, and that the best decision for both companies is to combine forces? That last question makes a lot of assumptions, and I’m not prepared to say definitively that a merger is the best option for both companies. After years of following the industry it makes the most sense to me, but I’m not the guy balancing the books. P.J. Louis of PJ Louis LLC believes that it “is not a matter of ‘if’ but a matter of ‘when’.” Furthermore, he believes that the companies cannot survive if they do not merge, a hefty claim but perhaps with a healthy dose of truth. He does bring up an interesting point. Given the U.S. wireless landscape, even a combined Leap/Metro might not compete well enough with the Big 3. By merging, however, they might make a more attractive target for further acquisition by one of the Big 3 — especially if the combined company moves forward with Metro’s LTE plans. Perhaps T-Mobile could find the merged company a sufficient target to help bring it into the land of 4G. ]]>
why do you think this is necessary since they already have a mutual roaming agreement already. why would a metro pcs shareholder benefit from Leap’s less attractive markets, lower margins, and substantially greater leverage. why wouldn’t it simply drag Metro down the same ditch that Leap management crashed into.
If struggling Tmobile tries to swallow an incompatible network NOW, it will be another Sprint eating Nextel type disaster of incompatibilities and identity problems. If Sprint were smart, they would have left Nextel well enough alone, slowly merging the two distinctively different companies but they rushed it and screwed it up.
Most of Nextel’s top execs left within a year of the merger and Nextel went from around 20 million to 8 million in half a decade of Sprint/Nextel slowly bleeding to death.
Sprint’s applied some prepaid bandages but they continue to bleed. They are shrinking so consistently that they no longer say how good they did but how less much less worse they did then last time.
Sprint is a slowly sinking ship and no amount of prepaid is going to save it.
Currently only 20% of their customers are on prepaid. If they increase that proportion, the most volatile churn prone segment of their user base will go up and profits will go down.
Sprint has to get steady on its postpaid before relying on its prepaid to save their ailing hides. Prepaid alone can’t do it.
And Sprint has a major identity crisis.
Like how the Nextel merger created confusion, they intend to introduce at least one more, maybe two brands within six months.
They’ve acquired Virgin Mobile and have let it rot there for months and put a ton of effort into almost dead Boost cdma.
I really wonder what the hell they’re thinking when they give other non Sprint owned mvnos better deals then their giving their own child, Virgin Mobile. You can get unlimited talk/text/web on Platinum Tel for $60. On VM, even at $70, you only get talk/text and 50 megs web.
Liberty Wireless, who briefly made headlines with an extremely short lived byod plan killed by Sprint has unlimited everything for $50.
Virgin Mobile hasn’t added a new handset since Sept. 2009.
Sprint doesn’t know what the hell they’re doing. They will lose whatever advantage Boost iden’s three spectacular quarters gave them because the execs running that company are simply clueless dolts. Like the guys at Motorola and Palm.