Katie Marsal
T-Mobile, the fourth-largest wireless carrier in the U.S., is on track to merge with MetroPCS after the board of America's fifth-largest carrier approved an agreement.
The pending deal promises to shake up the U.S. wireless market, if it becomes final. The board of directors at MetroPCS reportedly approved the merger with Deutsche Telekom's T-Mobile USA, according to Financial Times Deutschland.
The deal must still be approved by Deutsche Telekom, and would also require regulatory approval in the U.S. Previously, AT&T, which is the second-largest U.S. carrier, attempted to acquire T-Mobile, but the deal was dropped following scrutiny from the Federal Communications Commission.
The combined company would be controlled largely by Deutsche Telekom, which would reportedly hold a 74 percent stake, leaving MetroPCS with a 26 percent share.
T-Mobile and MetroPCS are noteworthy because they are two of the only carriers in the U.S. that do not offer Apple's iPhone. Apple has inked deals with AT&T, Verizon, Sprint, and even a number of regional carriers such as CellCom, nTellos, Appalachian Wireless, C Spire, GCI, and Cricket Communications.
Earlier this year, T-Mobile publicly said that it lost more than 700,000 contract subscribers "primarily" because of Apple's launch of the iPhone 4S in late 2011.
Apple's iPhone models to date have been incompatible with T-Mobile's network frequency band. While the iPhone can place calls on T-Mobile's GSM network, it cannot connect to the carrier's unique 3G frequency for high-speed data.
However, earlier this year T-Mobile revealed plans to begin rolling out 4G HSPA+ service on the 1900MHz band in major markets. The carrier characterized its efforts as a "network modernization effort," and the changes allow customers to connect their unlocked iPhone to T-Mobile's high-speed data network.
The 1900MHz spectrum was obtained by T-Mobile from AT&T as a result of AT&T's failed takeover bid. The deal called for AT&T to hand T-Mobile $1 billion worth of spectrum.
A merger of T-Mobile and MetroPCS would be particularly interesting because the two carriers operate different standards for their 3G networks. MetroPCS relies on CDMA technology, while T-Mobile has an HSPA network that is incompatible with CDMA devices. Both companies are building out true 4G LTE networks as well.
T-Mobile has a total of 33.2 million subscribers, while MetroPCS is a distant fifth among U.S. carriers with 9.3 million subscribers. A merger would bump T-Mobile up to 42.5 million subscribers, a number still well behind third-place Sprint, which had more than 56 million subscribers as of the second quarter of 2012.
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9 Comments
This should help their iPhone prospects...
Into MeT-Mobile PCS!
And they still won't get the iPhone.
T-Mobile is a hell of a lot cheaper than ATT if you have an unlocked iPhone. With the 1900 band it will be equivalent in speed. This is mainly due to not having to subsidize the purchase of an iPhone. Anyone who keeps ATT with an iPhone after two years contract is giving ATT an additional $40/month. The only way to make out with ATT is to keep the phone until the end of the contract, unlock it, sell it, and buy a new iPhone.
Just rename the companies iPhoneless Mobile
I hope they do merge, the anti competitive nature of Verizon and AT&T is getting out of hand and Sprint can't battle it alone. We need a 4th major carrier involved to push the price gouging down and introduce some competition. Right now I think people are afraid to switch away from the Big Two for fear of poor network coverage on the smaller carriers.