T-Mobile USA and parent company Deutsche Telekom probably thought the most difficult part of securing their just-announced merger with MetroPCS would be getting it through the regulatory process. Don't look now, but competition could be in the offing.
Members of Sprint's board of directors will get on a conference call Friday and mull the possibility of presenting a counter offer for America's fifth-largest wireless provider, "people familiar with the matter" told the Wall Street Journal.
The combination of T-Mobile and MetroPCS would hurt Overland Park, Kan.-based Sprint, which is the country's third-largest provider in terms of subscribers. Some subscriber estimates of a combined T-Mobile-MetroPCS put the newly formed company ahead of Sprint. The Journal reports that Sprint almost had an agreement with MetroPCS last winter, but its board put the kibosh on the move.
But would pursuit of MetroPCS be a good move for Sprint now? One could argue that the company is in a pretty good position – its stock is one of the best performers this year as the company reaps from the benefits of a gamble to spend more than $15 billion worth of iPhones from Apple. Subscribers are returning and many analysts predict the carrier has a good shot at soon returning to profitability. A Sprint-MetroPCS tie-up actually makes more sense anyway: The companies use the same network technology; T-Mobile hasn't launched LTE service yet.
The boards at T-Mobile and MetroPCS approved a merger Wednesday that they said will "create the leading value carrier in the U.S. wireless marketplace."