Sprint CEO Considers Merger With T-Mobile, Switching to LTE

Usually, corporate mergers follow a predictable pattern. That is to say, one party will approach the other in private, and the negotiations are equally discreet. And yet, buried in an interview with the Financial Times, Sprint CEO Dan Hesse said that merging with T-Mobile would be a “logical” move if both companies chose to invest in LTE networks. To date, T-Mobile hasn’t publicly expressed interest in such a deal, although the idea has been floated several times before. Indeed, the idea makes lots of sense: T-Mobile’s German parent company has already pondered selling its American business, and hasn’t yet made any commitments to building a 4G network in the U.S.

Up until now, though, the networks’ incompatible technologies have posed a sizeable obstacle: T-Mobile uses GSM and Sprint, CDMA. In fact, it’s because of this that T-Mobile shied away from a merger with Sprint back in 2008.  Today, Sprint seems more flexible: Hesse said in the same interview that Sprint owns enough spectrum to build out an LTE network alongside its current one, which is based on WiMax, a competing 4G technology. If Sprint is indeed willing to invest in LTE for the sake of technological compatibility with T-Mo, the companies would form a more formidable competitor for both AT&T and Verizon.

Source: Financial Times via Phonescoop.