Verizon not buying Sprint in response to AT&T/T-Mobile deal

After AT&T announced its impending purchase of T-Mobile from Deutsche Telekom for $39 billion, theories have been flying back and forth about the plans of the remaining two of the "Big Four" wireless carriers. Sprint, whose underdog mentality has allowed it to use the weaknesses of its bigger brothers to recover from its freefall just a few years ago, is now the only underdog in the mix, and is threatened more than ever by aggressive cost competition and carrier exclusivity deals. Verizon, used to being the top dog in network performance and phone selection (now that they’ve included the iPhone in their veritable lineup), now sees AT&T as a threat instead of a nuisance, as they prepare to grow their cell sites and spectrum to a more acceptable level.

Many thought that Verizon would look to buy Sprint in an effort to stop AT&T from buying a huge leg up in the industry.  It would give Sprint a chance to cut its losses before being overrun as the small guy in the ring, and it would give Verizon a whole bunch of fresh subscribers and spectrum.

According to Reuters, this isn’t going to happen. In an interview preceding the annual CTIA wireless convention, Verizon CEO Daniel Mead says that they have no problems with AT&T going through with their controversial acquisition. He said that it would simply be postponing the inevitable. "Anything can go through if you make enough concessions," he said. Passive aggressive jabs aside, Sprint didn’t take the news as coolly.  Within 24 hours of the announcement, Sprint had already released an official statement claiming that the deal was an antitrust nightmare, and "would alter dramatically the structure of the communications industry." Sprint had also been talking with T-Mobile about their own deal, which would give T-Mobile a significant portion of Sprint stock, effectively joining the two underdogs in a fight against AT&T and Verizon. With AT&T pulling the rug from under this plan, its understandable that Sprint would feel a little jilted.

Mead also confirmed that Verizon Wireless has no plans to purchase Sprint. He took a similarly dominant tone with this as well. "We're not interested in Sprint. We don't need them." Verizon seems to be taking the high road here, belittling the threat that AT&T brings to table by brushing it off as inevitable. He seems to be confident that the quality of his network will prevail over the soon-to-be huge numbers that AT&T will be pulling in. Sprint, in the meantime, has some serious soul searching to do. If they stagnate now, they will face serious issues with phone manufacturer deals and price competition. While much of this is still up in the air, the one sure thing is that things will be different in a year from now.

Report a problem with article
Previous Story

Firefox 4 now officially released

Next Story

Apple reveals international pricing for iPad 2; March 25 release

28 Comments

Commenting is disabled on this article.

As a person on Engdaget has said:

The reason why Verizon will not oppose the ATT-Tmobile deal is because they want to kill low cost service. Together Verizon and ATT control the prices of the wireless market. The only two companies who challenged them and successfully forced them to slash their prices almost 30% last year were Tmobile and Sprint. Verizon is happy that without T-mobile, nobody will complain about the insane rates they charge for service because the only other "comparable" service will be ATT who also likes to over charge their customers. Verizon doesn't want to buy Sprint because even if this means getting more customers, it also means dealing with the massive network management that Sprint has(CDMA/WIMAX/IDEN). What ATT or Verizon are not counting on is the massive exodus of Tmobile customers to Sprint in the coming months. Dear Sprint this is your time to shine as the truly consumer friendly, wallet conscious alternative to Verizon and ATT.

A bigger question than VZW buying sprint for me is does sprint buy US Cellular? It was already rumored that Sprint was in a buying mood and was interested in TMobile, maybe US Cellular would be a second option.

alarson83 said,
A bigger question than VZW buying sprint for me is does sprint buy US Cellular? It was already rumored that Sprint was in a buying mood and was interested in TMobile, maybe US Cellular would be a second option.

Exactly what i was thinking..
It would make more sense if Sprint merged with US Cellular, (or both US Cellular & Cellular South), phased out the old Nextel-iDEN band, and became a strictly CDMA carrier.
That would make more sense infrastructure wise for them than to try to merge with t-mobile and try to support GSM, CDMA & iDEN

Personally I don't think T-mobile is all that cheap, I don't understand why people use them in the first place. I used them when they were cheap and the trade off for that cheapness was a crap network. Sprint actually has a good network where I am, including 4G and I pay 70 a month for completely unlimited everything.

nubs said,
Personally I don't think T-mobile is all that cheap, I don't understand why people use them in the first place. I used them when they were cheap and the trade off for that cheapness was a crap network. Sprint actually has a good network where I am, including 4G and I pay 70 a month for completely unlimited everything.

I'm exactly the opposite. T-Mobile has been solid while Sprint was spotty. It all depends on the location.

As a T-mobile prepaid customer, this is a lose lose situation for me.
Not only I will have to get a new unlocked 3G phone. I will see my data capped.
My cost will escalate to 3-4 times based carrier rates for similar plans.

T-mobile says they will says they will honor all contracts post merger, but what about us prepaid users we have no contract ?!
We are screwed.

AT&T logic that the merger will bring coverage to 95% of Americans is full have holes.
The same could be achieved with roaming agreements between carriers like in Europe or several Asian countries.
Plus with that $39 billion dollars they are offering can build out a more expansive infrastructure than any merger would.

This merger is just a ruse to kill the competition.

On a side note, I think the government should ban selling all the locked phones -- this is creating unfair competition. The only USP of AT&T for many consumers was just that it was offering the iPhone, this kept lining AT&T's pockets and they were not worried losing consumers even with high rates.

Even if Verizon wanted to buy sprint regulators wouldn't let it happen. That would leave 2 major carriers only in the US. Not gonna happen.

Lenh4rtjames said,
Even if Verizon wanted to buy sprint regulators wouldn't let it happen. That would leave 2 major carriers only in the US. Not gonna happen.

Why not? There is still competition and about a 50/50 split in size... I don't like that these companies are merging and becoming larger either, but I don't see why Sprint and Verizon wouldn't be allowed to merge.

spartyjohnson said,

Why not? There is still competition and about a 50/50 split in size... I don't like that these companies are merging and becoming larger either, but I don't see why Sprint and Verizon wouldn't be allowed to merge.

AT&T + T Mobile may be a hard already for approval already, but if it goes through, it would be even harder for Verizon to get approval for sprint.

spartyjohnson said,

Why not? There is still competition and about a 50/50 split in size... I don't like that these companies are merging and becoming larger either, but I don't see why Sprint and Verizon wouldn't be allowed to merge.

Not only is it market share but more importantly the amount of spectrum that ATT will have if it merges with t-mobile. That is the biggest concern of the regulators on approving the deal.

etempest said,

AT&T + T Mobile may be a hard already for approval already, but if it goes through, it would be even harder for Verizon to get approval for sprint.

Actually its the other way around. If AT&T gets approval then you will see Vz and Sprint get together. If AT&T fails to get approval then nothing else will happen.

The government will give Vz approval if nothing else to make it a 50/50 split with that idea that at least it will be even ground for the battle.

I for one think if this deal is approved, Sprint is in the best shape, as I see a large number of T-Mobile customers jumping over for the lower rates and unlimited plans w/Sprint. I'm also a happy Sprint customer (EVO) so I do have some bias.

I do agree about the T Mobile's prices... however there will still be cheaper carriers! I've recently switched from Sprint to ATT because of the phones. At the time I couldn't stand that both the iPhone and the Blackberry Torch were not offered to Sprint customers, and I was willing to sacrifice unlimited everything for a downgraded and limited plan to try out the Torch. To add to that, there may be another new iPhone when I'm finished with the Torch!! Like he said... much will be different in the upcoming years.

Does this mean T-Mobile will no longer exist or it will exist under AT&T's rule? If this is the case doesnt this mean that AT&T has a much larger 4G network now?

xbamaris said,
Does this mean T-Mobile will no longer exist or it will exist under AT&T's rule? If this is the case doesnt this mean that AT&T has a much larger 4G network now?

It will exist under AT&T's rule.

xbamaris said,
Does this mean T-Mobile will no longer exist or it will exist under AT&T's rule? If this is the case doesnt this mean that AT&T has a much larger 4G network now?

It will exist under AT&T for the next 12 (or so months) at which point T-Mobile will become T-who? as AT&T takes over completely.

You remember Nextel? Same idea

TechGuyPA said,

It will exist under AT&T for the next 12 (or so months) at which point T-Mobile will become T-who? as AT&T takes over completely.

You remember Nextel? Same idea

The are two completely seperate companies still. They have to wait for FCC and DoJ approval before they can merge.

Approval will take between 12 and 18 months.

After that, AT&T will probably want to slowly phase out the T-Mobile branding in favor of their own.

TechGuyPA said,

It will exist under AT&T for the next 12 (or so months) at which point T-Mobile will become T-who? as AT&T takes over completely.

You remember Nextel? Same idea

Yep and Alltel.

"We're not interested in Sprint" = "Why in the f*ck would we tell you so that the stock price runs up before we make our offer to Sprint?"

bj55555 said,
"We're not interested in Sprint" = "Why in the f*ck would we tell you so that the stock price runs up before we make our offer to Sprint?"

True... companies don't talk about what they are interested in, they'll go and do it when they're ready. Even rumors drive stock prices up, which means a more expensive buy.

I may be switching to verizon or sprint when AT&T takes over Tmobile. I HATE AT&T and the only reason I am with TMO is because of the cheap plans. ATT will screw that up.

techbeck said,
I may be switching to verizon or sprint when AT&T takes over Tmobile. I HATE AT&T and the only reason I am with TMO is because of the cheap plans. ATT will screw that up.

But the Rollover Minutes...

techbeck said,
I may be switching to verizon or sprint when AT&T takes over Tmobile. I HATE AT&T and the only reason I am with TMO is because of the cheap plans. ATT will screw that up.

I discovered last time I went in for an upgrade a few months ago that Sprint's current plans are quite a bit cheaper than TMO's, while AT&T and Verizon are still through the roof.

techbeck said,
I may be switching to verizon or sprint when AT&T takes over Tmobile. I HATE AT&T and the only reason I am with TMO is because of the cheap plans. ATT will screw that up.

I'm going Sprint as soon as the merger is complete, unless they keep some of the cheap plans and don't make my new HTC HD7 obsolete a year and a half from now.