Sprint Nextel CEO Dan Hesse speculation the collapse of AT&T’s bid for T-Mobile USA creates a strategic opportunity for his company.Sprint spent much of 2011 battling a proposed merger between its competitors AT&T and T-Mobile USA. Seven weeks after that deal was officially declared dead, Sprint Chief Executive Dan Hesse said the break-off would create opportunities for Sprint.
“It means many more options for Sprint than we would have had if the merger had gone through,†said Hesse in an interview following Sprint’s Feb. 8thfourth-quarter earnings call.
Hesse did not speculate on those options beyond referring to T-Mobile’s spectrum being back on “the table†in terms of general industry availability. During Sprint’s Feb. 8th call, Hesse said Sprint would entertain any transactions and partnerships that it viewed as benefiting shareholders.
Analysts have suggested some possibilities. One of the most prevalent hypotheses is that Sprint will strike a network-sharing deal with T-Mobile. Such a move would grant T-Mobile access to a 4G/LTE network while giving Sprint additional spectrum/capacity and generating revenues.
T-Mobile has said it is looking at deals that are smaller in scale than the proposed AT&T transaction, which met opposition from both the U.S. Department of Justice and the Federal Communications Commission. Last month, T-Mobile Chief Executive Philipp Humm told Forbes the company would reveal its LTE strategy by the end of March.
Hesse said Sprint wasn’t alone in its relief following the withdrawal of the AT&T/T-Mobile proposal. Investors had also worried about the chilling effect an AT&T and Verizon “duopoly†would have on innovation, Hesse said. After AT&T halted its efforts, Hesse said he “got calls from people saying they will start investing again in wireless startups.â€
“Things would have looked pretty bleak in the U.S. wireless industry if AT&T/T-Mobile had gone through,†contends Hesse. “It’s taken a worry off not only us, but others.â€
[Forbes]
