Report: Sprint and T-Mobile to become SoftBank USA, as merger is ‘agreed'

Rumours of a merger between two of America’s largest mobile carriers have been doing the rounds for some time, but it looks like the deal may soon be announced. Sprint and T-Mobile have apparently agreed the key terms of their proposed tie-up, and it seems that the two brands may soon disappear from the US market completely.

Reuters reported earlier this week that the merger was more or less a done deal, but new details have emerged via TK Tech News, citing an “extremely reliable” source. According to this source, the Sprint and T-Mobile brands will not live on post-merger, being replaced by a new ‘SoftBank USA’ brand. SoftBank is the Japanese communications giant which owns 80% of Sprint.

The introduction of the new SoftBank USA name would also result in the disappearance of a trio of other well-known brands in the prepaid mobile market, according to the report. Virgin Mobile USA and Boost, which are both owned by Sprint, would vanish along with MetroPCS, which is owned by T-Mobile.

Sprint CEO Dan Hesse is also said to be standing down as part of the merger, with current T-Mobile CEO John Legere - champion of T-Mo's 'Uncarrier' campaign - reportedly taking the top job at SoftBank USA. Deutsche Telekom, T-Mobile’s largest current investor, is expected to retain a 20% stake in the new company.

The deal is said to be more or less finalised, and may even be announced in the next few days. Even if it is, though, it will still be subjected to regulatory approval before the agreed terms of the merger can be fully enacted. In 2011, T-Mobile was the target of an acquisition attempt by AT&T, but regulatory issues and widespread outcry led to that deal being dropped, much to Sprint's delight.

SoftBank USA would become the second largest in the US in terms of customer numbers, leapfrogging ahead of Verizon, and just 1.3 million behind AT&T. 

Source: TK Tech Blog via PocketNow | lower image via iDownloadBlog

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As the owners of a couple of Boost Mobile stores, this is of great concern to my wife and me. Each of our stores are consistently one of the top in our city (the capital city of a state), with one often being the top. However, in the same shopping center/mall where that store is located, there are a couple of dealers that sell T-Mobile as well as a corporate MetroPCS store. The Metro store is probably five times the size as us and admittedly looks better due to what the can do in the space they have (as well as all of the corp fixtures they are provided). If the deal were to go through, do they keep the corporate stores, or go the Boost route and go private? Lots of questions and worries on the part of dealers. More-so than for customers at this point.
As a customer, one should not worry too much at this point as the difference in technologies won't be an issue immediately. They would maintain both networks for some time and slowly migrate people over to their new standard, possibly with some good incentives just as they did with the people hanging onto the old Nextel devices.

Wife and I have been saving and hoping to finally get out of the apartment life and buy a house. If we have a corp store that is two doors down from us, that could significantly effect our earnings. Would they even allow us to keep that location? At the end of the day, SBank/Sprint/TMo don't care if we (private dealers) make it or not, just that devices and lines are pushed out by somebody, somewhere.

Used to work at Sprint and we were always worried about this. Sprint's customer service in-stores is great but even when employees needed to call up with an issue, it was beyond awful.

Sprint still has CDMA equipment but has been transitioning a lot of their devices over to LTE. It's becoming less segregated in that carrier branding and locking still exists but Sprint has been moving toward SIM card use, especially now that they're moving to BYOD.

I can see their advertising tag line now.

Softbank USA: Your New Name in Suck..

Softbank has a pretty decent reputation in Japan. Unfortunately it will be thrown in the crapper by owning Sprint. I have limited experience with T-Mobile. Do they have better customer service? If so, people working in Overland Park, KS should be a bit concerned..

Sgt Beavis said,
I can see their advertising tag line now.

Softbank USA: Your New Name in Suck..

Softbank has a pretty decent reputation in Japan. Unfortunately it will be thrown in the crapper by owning Sprint. I have limited experience with T-Mobile. Do they have better customer service? If so, people working in Overland Park, KS should be a bit concerned..

T-mobile has pretty good customer service. I can call them and talk to a real person within 5 minutes. I used to be on AT&T and depending on the time of day it could take up to an hour depending on the situation.

It would be rather stupid to drop an already recognized brand entirely...

I realize Soft Bank is a brand elsewhere, but not here...

i thought verizon is the largest mobile provider in the usa and at&t is the second largest. i do not see if this softbank usa could achieve the second slot just yet. i feel sorry for all those that jumped on board with tmo usa and the lose to of the one acquired by tmo and sprint.

i do not see this getting approved because it will cause less competition. at&t will have a real knife in their back because i think softbank uses gsm?

Edited by belto, Jun 9 2014, 3:30am :

I think that while I dread most mergers, this one may actually be a benefit. If John Legere is going to be the CEO, and most of the T-Mobile management team is staying, it means that SoftBank recognizes that the T-Mobile side (which is supposed to be the smaller company) has the better management folks, and will cut loose the Sprint management folks.

T-Mobile has made their programs successful and their customer base is very loyal... Sprint folks, get ready for some changes to your phones. *chuckle*

My family has been on Tmobile for 15 years now, always had a good experience and love their rates/no contract plans right now. I just hope with the merger nothing changes as far as the rates go.

as a sprint customer who just came from tmobile i hate the name softbank lol they had better come up with something different before this is approved and signs and websites change.

just so are clear, SoftBank owns a major portion of Sprint now. Its a Japanese company that has been around for almost 33 years. this would be awesome though. I wish we'd be free to use GSM phones

CJ33 said,
just so are clear, SoftBank owns a major portion of Sprint now. Its a Japanese company that has been around for almost 33 years. this would be awesome though. I wish we'd be free to use GSM phones
Yes i knew they owned 80% of sprint but they didnt rename sprint softbank. That would of been horrible. Service wise i am excited about it though. Not sure im all that thrilled with Sprints spark network though

Houtei said,
as a sprint customer who just came from tmobile i hate the name softbank lol they had better come up with something different before this is approved and signs and websites change.

Yes yes, because weird/stupid/offtopic names have always, always resulted in a company failing.

All it takes for an unfamiliar name to be totally okay is just hearing it enough times. Don't know why THIS is the detail people are all sandyvag about.

Pray to <diety of choice> they don't kill the Tmo PAYG plan. One year of service for a Gold level topup is infinitely better than any other plan for light phone users. I only use about a couple hours per year.

I wonder what they will replace Sprint with something else at NASCAR. I like Sprint Cup better instead of SoftBank Cup..

What a horrible name for a company that, well, does anything at all.

I will be very sad to see T-mobile disappear. They were awesome.

However, if the old T-mobile CEO can turn SoftServe into the next T-mobile, then it might not be so bad.

Still think the name Softbank is going to mess with American minds, as you hear it and think it's another BANK!

Oh boy! Less competition!
Maybe after the merger, the Japanese will come in, spend some money, scrap the Sprint Network, beef up the T-mobile network and keep some of the "uncarrier" ideas and help dethrown at&t & Verizon, putting some real competition in the market.

If they combine into one network won't it be confusing to customers? Isn't Sprint CDMA? Wont that mean Softbank Phones will only work on parts of the network?

McKay said,
If they combine into one network won't it be confusing to customers? Isn't Sprint CDMA? Wont that mean Softbank Phones will only work on parts of the network?

They are both going to move everything over to LTE and VoLTE (voice over LTE) in fact T-mobile has already started testing VoLTE in San Francisco, Seattle, Houston, Dallas, and Chicago areas. For areas that are not allowed to have LTE GSM will probably be the legacy technology of choice because it is the world standard.

I've been using service with T-Mobile since 2008, and I got first Nokia, then Sidekick series, and now is back to Nokia Lumia 512. I will keep my new cell phone Lumia. I am not sure If I will switch to other service like AT&T or Verizon. maybe, if this new company stopped my text message pre-paid cost $15 per month.

I hope that this doesn't pass regulatory approval, but I know it will. Just to think of the thousands of people who will be out of a job so the board and shareholders can pad their pockets with even more money.

Can you imagine how many would be unemployed if they were to go under? word is noth were teetering on the edge of insolvency, and Sprint more so lately. Yes there will be some redundancies that will be removed, mostly in the management side, but most of those people can get jobs with some effort, the lower earning types should be fine, they already work in a high turnover field as it is

Dot Matrix said,
SoftBank? Because a cell phone carrier is the first thing I think of, when I hear that word.

They'll tax you like a bank. The name is well-deserved. :)

Dot Matrix said,
SoftBank? Because a cell phone carrier is the first thing I think of, when I hear that word.

I think they missed the boat if they go with this name. It's idiotic from a branding perspective to name it as such. Shh... I would choose Virgin Wireless from all those brand as it could fit the best. But at the end of the day they need to look for a better name. They would have to invest a lot of money educating the public that Softbank
is actually a Wireless provider.

Dot Matrix said,
SoftBank? Because a cell phone carrier is the first thing I think of, when I hear that word.

It seems to me, that Japan just has weird names for it's cell carriers anyway. Would you think NTT DoCoMo was also a cell carrier (if you didn't already know it was)? I surely wouldn't.

Just passed the minimum 90 days of service before I can ask for an unlock code on my MetroPCS phone so I think ill make that request and see how this merger works out or go somewhere else.

Keeping my eye on this as a current Verizon customer. Waiting to see if any new promotions and/or deals come out that would make me want to jump ship.

Promotions/Deals are nice provided the network is good. Hopefully it's not a case of 2 cruddy networks merge together making 1 big cruddy network.

Is one carrier being GSM and the other being CDMA a big deal here. Just thinking about the past (Sprint/Nextel merger).

Both are using LTE mostly now, so the whole GSM -CDMA thing is mostly gone, the real benefit will be combining their networks to boost everything overall for both sides

LTE has little to do with the CDMA/GSM compatibility. CDMA devices will NOT work on a GSM network (and vice versa) without explicit support for it and the bands needed for said network.

TechJunkie81 said,
Hopefully it's not a case of 2 cruddy networks merge together making 1 big cruddy network.

By "one big cruddy network" you mean turn into AT&T? ;-)

The few still not on unlimited to actually pay for incoming calls and texts, hopefully there aren't many of those left anymore

Cosmocronos said,

You get charged for incoming voice calls.

I'm on a pay as you go deal and only pay for what I use. get free internet for a minimum topup each month if I choose to topup that is.

guess the EU is good for somethings sometimes, just wish they'd hurry up and scrap the roaming charges already.:(

Cnónna said,

I'm on a pay as you go deal and only pay for what I use. get free internet for a minimum topup each month if I choose to topup that is.

guess the EU is good for somethings sometimes, just wish they'd hurry up and scrap the roaming charges already.:(


Yes, having to pay for incoming calls have been the mother of all scams in the US since the cellular phones became popular.

This is a little exciting. I assume as a Sprint customer, this means I will be able to one day use both the Sprint LTE network and the T-Mobile LTE network. That would really boost coverage in my area.

Only if your phone supports the necessary bands. Sprint is also CDMA while T-Mobile is GSM. Things won't just work unfortunately.

Ryan Hoffman said,
This is a little exciting. I assume as a Sprint customer, this means I will be able to one day use both the Sprint LTE network and the T-Mobile LTE network. That would really boost coverage in my area.

Interestingly we went through the same thing in the UK a few years ago with a merger between T-Mobile UK and Orange (http://www.neowin.net/news/t-m...ge-uk-merger-approved-by-eu). T-Mobile users could use Orange cell towers and vice versa. During the initial phase, it was a bit rough (your phone didn't always choose the strongest signal), however it did work well when only one of the providers was available at a given location. The other major downside at the time was that you had to enable data roaming for it to work, which posed a big risk if you travelled outside the UK and forgot to turn it off.

Unfortunately since EE took over T-Mobile I'm looking for a new provider since their customer service now sucks, and their data speeds on 3G are awful now. They also got really expensive too.

EDIT:

Grinch said,
Only if your phone supports the necessary bands. Sprint is also CDMA while T-Mobile is GSM. Things won't just work unfortunately.

Oh, well never mind eh. Hopefully this merger will make things a bit more standardized over your side of the pond! :)

Grinch said,
Only if your phone supports the necessary bands. Sprint is also CDMA while T-Mobile is GSM. Things won't just work unfortunately.

Nexus 5 would work great for people on SoftBank USA

Grinch said,
Only if your phone supports the necessary bands. Sprint is also CDMA while T-Mobile is GSM. Things won't just work unfortunately.

I thought your statement incorrect and checked online. From what I'm reading, CDMA and GSM are 3G standards which are indeed incompatible, but this nonsense stopped with 4G LTE. LTE is based on tech from both sides and supposedly can work globally - just check Wikipedia. I can't say I'm 100% positive on this info since I only know what I've read online, but it suggests the CDMA vs GSM debate is put to pasture by LTE being a common global standard (as long as different countries adopt it, of course).

This also seems to concur with my experience travelling overseas around the world, where my Lumina 920 has connected to LTE connections no matter what country I was in.

Even to the current date, unless a phone supports CDMA and the appropriate bands it cannot jump on a CDMA network without the network making a compatibility layer of sorts. Big bummer but ideally with T-Mo/Sprint's combined towers they can swap all the CDMA hardware for GSM.

mrp04 said,

Nexus 5 would work great for people on SoftBank USA

Considering we probably won't see anything real fast out of this Nexus 5 will probably be super old when it can use both networks. It's not just gonna happen overnight.

Grinch said,
Even to the current date, unless a phone supports CDMA and the appropriate bands it cannot jump on a CDMA network without the network making a compatibility layer of sorts. Big bummer but ideally with T-Mo/Sprint's combined towers they can swap all the CDMA hardware for GSM.

Given that Sprint is replacing all of their old CDMA equipment for new CDMA equipment, I highly doubt they would let go of CDMA without a fight. I see it being more likely that they will get rid of T-Mobile's aging GSM network. Of course, the third option would be to sunset both networks for an all LTE network once their combined LTE rollout is complete and all of the phones on both networks are compatible with all of their LTE bands and technologies. Which is unfortunate since Sprint is choosing TD-LTE for their entire rollout while T-Mobile is rolling out FDD-LTE, neither of which are actually compatible with each other. That could cause some problems for users in areas where both companies have an active LTE network since the phone would constantly have to switch modes in order to hop onto a tower with better signal. Either way, this merger is going to cause one GIANT headache for Softbank.

Anthony S said,

Given that Sprint is replacing all of their old CDMA equipment for new CDMA equipment, I highly doubt they would let go of CDMA without a fight. I see it being more likely that they will get rid of T-Mobile's aging GSM network. Of course, the third option would be to sunset both networks for an all LTE network once their combined LTE rollout is complete and all of the phones on both networks are compatible with all of their LTE bands and technologies. Which is unfortunate since Sprint is choosing TD-LTE for their entire rollout while T-Mobile is rolling out FDD-LTE, neither of which are actually compatible with each other. That could cause some problems for users in areas where both companies have an active LTE network since the phone would constantly have to switch modes in order to hop onto a tower with better signal. Either way, this merger is going to cause one GIANT headache for Softbank.

Considering GSM is a lot better for everyone (in my opinion at least) and the fact that Sprint/Verizon Wireless are the only real CDMA carriers I can't see Sprint, after a merger, holding on to it for long.

Frankly the merged entity would be better off swapping out the hardware in the CDMA towers for GSM hardware. Do keep in mind that supposedly the T-Mobile CEO John Legere will be running the merged entity which suggests that T-Mobile will be in control at the end of the day (and probably for the best to).

Grinch said,

Considering GSM is a lot better for everyone (in my opinion at least) and the fact that Sprint/Verizon Wireless are the only real CDMA carriers I can't see Sprint, after a merger, holding on to it for long.

Frankly the merged entity would be better off swapping out the hardware in the CDMA towers for GSM hardware. Do keep in mind that supposedly the T-Mobile CEO John Legere will be running the merged entity which suggests that T-Mobile will be in control at the end of the day (and probably for the best to).


I completely agree with you regarding GSM. Sprint was stupid to have abandoned it when they first trialed it in Baltimore before deciding to rollout CDMA "nationwide." I hope for their customers' sake they do switch to GSM/HSPA+ hardware on the Sprint network. I believe that's what they should have done with their "Network Vision" plan. Sadly, it will have been the biggest waste of time and money if they do eventually decide to scrap all of that new hardware. Plus, I'm sure their CDMA roaming partners will have a fit. But it definitely, as you suggest, will be better for all if they keep and expand their GSM network.

I criticized the other merger deals, but I might semi-support this one. I know the tough financial situation sprint and T-Mobile are in, admittedly of their own doing mostly, but the mobile market which sucks as it is, is better with three strong competitors rather than 2 companies that dominate and some minor competitors (Sprint and T-Mobile).

Either way, it won't do anything to help the American mobile consumer.

Cnónna said,
should have called it SoftCell

SoftBank has been around for quite some time, but yes they shouldnt use that name for the phone network when they are done.

timster said,
that would make more sense seeing as neither Sprint nor T-Mobile is a bank.

SoftBank itself isn't a bank either, so I'm not sure it really matters....

Cnónna said,
should have called it SoftCell

Maybe their customers would be back with up to 500 Mbs of download data by the FCC? ;)