Following its failed acquisition with AT&T, T-Mobile USA’s parent company Deutsche Telekom just announced that it has reached a deal to combine its U.S. operations with MetroPCS, the nation’s fifth-largest carrier. What’s in it for you?
For starters, T-Mobile gets to finally jump on the 4G LTE bandwagon as MetroPCS has been deploying this technology over the past two years. This could be a bargaining chip the merged carriers may just need to finally land the iPhone…
According to The Wall Street Journal and AllThingsD, the transaction requires customary regulatory approval from both The Federal Communications Commission and MetroPCS shareholders and is expected to close in the first half of 2013.
The Financial Times Deutschland reports that both carriers will be combined into a single entity where Deutsche Telekom will have a 74 percent stake while MetroPCS will get the remaining 26 percent shares and $1.5 billion in cash.
T-Mobile writes in a blog post that the combined company will retain the T-Mobile name and will have “the expanded scale, spectrum and financial resources to aggressively compete with the other national U.S. wireless carriers”.
MetroPCS is the nation’s fifth-largest carrier, behind Verizon Wireless, AT&T, Sprint Nextel and T‑Mobile USA. The Richardson, Texas-headquartered telecommunications network had 9.5 million subscribers as of January 2012. Its 3G network uses CDMA technology, but the company is also deploying 4G LTE.
T-Mobile USA operates HSDPA+ network incorrectly marketed as “4G” though it is really just a speedy 3G. T-Mobile is the farthest behind the big three carriers in commercial 4G LTE deployment as the carrier pledged to begin a nationwide 4G LTE rollout in 2013.
Because T-Mobile’s and MetroPCS’s 3G networks are incompatible, the two carriers won’t be able to share signal and 3G customers across their respective networks. Neither carrier has the iPhone.
However, given that T-Mobile’s HSPA+ network is iPhone-compatible and that the carrier is offering free support to unlockers, and with 4G LTE in mind, perhaps the new company will have enough leverage to cut a deal with Apple?