Five years ago, T-Mobile merged with MetroPCS in the 4G era. Three times the number of people work on MetroPCS today compared to the time of the acquisition in 2013. Last week, T-Mobile US and Sprint Corporation announced a definitive agreement to merge.
The combined company will be named T-Mobile, and it will have the network to create a leading 5G network for U.S. firms and entrepreneurs.
“The combination of these two dynamic companies can only benefit the U.S. consumer. Both Sprint and T-Mobile have similar DNA and have eliminated confusing rate plans, converging into one rate plan: Unlimited,” said Marcelo Claure, currently the chief executive officer of Sprint.
“We intend to bring this same competitive disruption as we look to build the world’s best 5G network that will make the U.S. a hotbed for innovation and will redefine the way consumers live and work across the U.S. I am confident this will spur job creation and ensure opportunities for Sprint employees as part of a larger, stronger combined organization, and I am thrilled that Kansas City will be a second headquarters for the merged company.”
Following closing, the new company will be headquartered in Bellevue, Wash., with a second headquarters in Overland Park, Kan.
John Legere, current president and chief executive officer of T-Mobile US and the creator of T-Mobile’s Un-carrier strategy, will serve as Chief Executive Officer, and Mike Sievert, currently the chief operating officer of T-Mobile, will serve as President and Chief Operating Officer of the combined company.
Claure will serve on the board of the new company.
“This combination will create a fierce competitor with the network to deliver more for consumers and businesses in the form of lower prices, more innovation, and do it all so much faster than either company could on its own,” said John Legere. “As we enter the 5G era, consumers and businesses need a company with the disruptive culture and capabilities to force positive change on their behalf.”
America’s early 4G leadership is credited with creating 1.5 million jobs and adding billions to the U.S. GDP. With 5G, the stakes are even higher.
“Going from 4G to 5G is like going from black and white to color TV,” added Claure. “It’s a seismic shift – one that only the combined company can unlock nationwide to fuel the next wave of mobile innovation.”
The new company expects prices to drop as competition heats up.
The New T-Mobile will have lower costs and unprecedented network capacity – a winning combination that should make wireless, and adjacent industries like cable and broadband, more affordable for everyone.
“This isn’t a case of going from 4 to 3 wireless companies – there are now at least 7 or 8 big competitors in this converging market. And in 5G, we’ll go from 0 to 1. Only the New T-Mobile will have the capacity to deliver real, nationwide 5G,” added Legere. “We’re confident that, once regulators see the compelling benefits, they’ll agree this is the right move at the right time for consumers and the country.”
When Sprint and T-Mobile combine, more than 200,000 people will work on behalf of the combined company in the U.S. at the start.
The New T-Mobile plans to invest up to $40 billion in its new network and business in the first three years.
5G is expected to create 3 million new U.S. jobs and $500 billion in economic growth by 2024, according to a report from CTIA.
The new company will have some of the most iconic brands in wireless – T-Mobile, Sprint, MetroPCS, Boost Mobile, Virgin Mobile – and will determine brand strategy after the transaction closes.
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