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According to some analysts, Sprint will be able to save up to $6.6 billion on a variety of costs if they are able to merge with T-Mobile. In order to achieve those savings, Sprint will also need to slash prices with deep discounts and most likely a decline in immediate revenue.

T-Mobile Globe International

Last year, Vermont Attorney General William Sorrell announced that AT&T, Sprint and T-Mobile had struck an agreement with forty-five states to stop billing for these very same Premium SMS services (or as he put it “scam artists”). Premium SMS services have been around for years and have almost always been a source of fraud. Carriers did not do anything about the fraud for years because they received a cut of the profit, often as high as 40%.

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One of Son’s biggest project has been his insistence that a merger with T-Mobile would allow Sprint to enter the home broadband market through fixed-LTE broadband space. Yet, this week, Sprint CEO Dan Hesse stated that offering a fixed LTE service is nowhere on Sprint’s horizon.

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Sprint & T-Mobile have agreed on the broad outlines of a merger valuing T-Mobile at around $32 billion, according to the Wall Street Journal. Under the deal, Sprint would pay around $40 a share for T-Mobile during the summer time. The deal would be roughly 50% cash and 50% stock. T-Mobile’s largest shareholder, Germany’s Deutsche Telekom AG, would retain a stake of 15% to 20% in the new company.