Sprint, T-Mobile merger approval has '10 percent' chance, analyst says

By a number of credible accounts, a merger between telecom giants Sprint (NYSE: S) and T-Mobile (NYSE:TMUS) is only a matter of time--in fact, news outlets including Bloomberg and The Wall Street Journal believe an announcement could come as soon as July.

The New York Times reported late Wednesday that the two sides were homing in on a deal in which Sprint would acquire T-Mobile in a pact valued at around $32 billion.

With regulators already bleary-eyed from examining the even bigger proposed Comcast-Time Warner Cable and AT&T-DirecTV mergers, what chance do Sprint and T-Mobile have in this crazy consolidating world of getting federal sign-off? Not much, according to media-industry analyst Craig Moffett.

On Thursday, the MoffettNathanson Research principal posted a not-so-optimistic analysis in which he put a 10 percent chance of the deal winning federal approval. (You can read it here, but a subscription is required.)

"By now, every investor has heard everything there is to hear about the merits of a merger," Moffett writes. "That there needs to be a strong third. That Sprint and T-Mobile aren't independently viable. That Sprint will be a "super maverick." That Sprint/T-Mobile can be a fourth giant to counter the new three kings of Internet access--Comcast, Verizon and  AT&T. But here's the thing: the DOC and FCC have heard all these arguments too, and they fully understood them long before they went on record with their skepticism. It is absurd to suggest that the DOJ and FCC were simply waiting for [Sprint majority owner] SoftBank to articulate the arguments."

For more:
- read this Bloomberg story
- read this Wall Street Journal story
- read this New York Times story

Related links:
Analysts: Sprint/T-Mobile must merge or one will fail
SoftBank's Son to CCA carriers: 'We need to fight back'

WHITEPAPER

How To Lower the Cost of Ownership of Your Cable Access Network

This white paper presents a cost analysis of a virtualized cable modem termination system (CMTS) deployed in a distributed access architecture (DAA). Learn how to eliminate traditional CMTS constraints, efficiently enhance your network performance and more.

Suggested Articles

The Apple TV remote is an often reviled peripheral device. Universal Electronics has taken it upon itself to create a different option.

Charter said it’s building an IP video aggregation platform complete with new hardware.

John Malone, Liberty Media chairman and cable industry titan, sees a future full of growth for streaming platforms like Amazon, Roku and Apple.