Sprint Promises Price War if T-Mobile Merger is Allowed
Published on: 11th Mar 2014
By: Ian Mansfield
USA's Sprint had promised a "massive price war" if it is allowed to buy T Mobile USA. The comment was made by the President of Sprint's controlling shareholder Japan's Softbank.
Softbank's President, Masayoshi Son said that only by combining Sprint and T-Mobile could the two networks compete with the dominant Verizon and AT&T networks.
Son said that he was willing to defer short term profit gains in favour of customer growth and promised a price war in the US markets if the merger were permitted to go ahead. He also indicated that the merged company would increase investment to boost mobile broadband speeds, although he didn't specify what changes would be made.
"We need a certain scale, but once we have enough scale to have a level fight, OK," Son said during the interview with Rose, airing nationally in the U.S. "It's a three-heavyweight fight. If I can have a real fight, I go in more massive price war, a technology war."
Sprint has been eying a bid for T-Mobile, although no formal offer has been made, and US regulators have indicated that they would be against such a deal if one were to be made.
Germany's Deutsche Telekom, which owns two-thirds of T-Mobile USA hasn't commented on the possibility of selling its stake, although it did recent shift its shareholding to lower tax jurisdiction which heightened speculation that a sale could be imminent.