Sprint and T-Mobile, the third and fourth largest carriers in the U.S., need to expand coverage, according to two recent studies. The study reports Verizon Wireless as the country's largest wireless network, with AT&T tailing. Verizon and AT&T combined, serve two-thirds of the subscribing public. RootMetrics and JD Power conducted the studies.
A news analysis in Computerworld said the studies undeniably convey federal regulators a rationale to allow Sprint and T-Mobile to merge, just as Softbank of Japan, the parent company of Sprint, desires. Softbank Chief Executive, Masayoshi Son, has been reported by the Wall Street Journal as bidding for T-Mobile, despite opposition from the antitrust officials in the U.S. worried that carrier competition will be reduced. Likewise, the Justice Department rejected the offer of AT&T to purchase T-Mobile in 2012.
Regulators are weighing whether the merger of Sprint and T-Mobile would improve wireless network coverage, not just for months, but for years; and if they can become profitable enough to buy a new spectrum. Both Sprint and T-Mobile have their respective customers in the same places and need to reach beyond their current footprints, which would only be possible with more spectrum. Two auctions for spectrum are coming in the next two years – one for high-frequency AWS-3 in September, and the other for low-frequency 600 MHz which is currently used for broadcast TV.
For the two companies, the timing may not be right as it could take months to come up with a sound merger review for federal officials, and at the same time bid in the auctions. For now, major cities additional spectrum is what both companies need to enhance, as stated in the report by RootMetrics and JD Power.