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T-Mobile/Sprint merger finally closes as John Legere departs as CEO
The day has finally come. After literally years of waiting — and one false start — T-Mobile and Sprint have finally merged their companies. T-Mobile’s press release officially announced the closing of the merger with Sprint. As promised, the company will be known simply as T-Mobile. It is expected to cost T-Mobile $26 billion.
Along with the merger, T-Mobile CEO John Legere is leaving his role as CEO, with Mike Sievert taking over that position. Legere will remain on the company’s board of directors through the end of June 2020.
T-Mobile is already promoting the benefits of merging with Sprint. It claims that its wireless rates will remain the same, or even get better, for at least the next three years. Indeed, T-Mobile has already launched a $15 a month Connect plan, with unlimited talk, text, and 2GB of LTE data. However, if you happen to go over that data amount before the billing cycle ends, T-Mobile will just shut off your mobile data.
T-Mobile also claims that the Sprint merger will allow the carrier to increase its current capacity by up to 14 times within the next six years. In that same time period, T-Mobile claims it will offer 5G speeds to 99% of the U.S. population, with 90% getting an average of 100Mbps in download speeds. In addition, 90% of rural customers will get an average of 50Mbps in download speeds, according to the carrier.
T-Mobile and Sprint tried to merge in 2014, with Sprint as the controlling company. However, that proposal was canceled after Sprint’s executives felt that such a move would not be approved by the U.S. government on antitrust grounds. In April 2018, T-Mobile officially announced its intentions to merge with Sprint. The deal was supposed to close by the end of 2019. However, government regulators took more time than normal to look over the deal.
T-Mobile ended up making a number of concessions, including a promise to sell off Sprint’s Boost Mobile subsidiary and to sell some of Sprint’s wireless spectrum to Dish Network for $5 billion. Dish is supposed to use that spectrum as the center of a new wireless carrier, which will cover 70% of the country with 5G support by June 2023.
In 2019, both the Justice Department and the Federal Communications Commission approved the merger. However, a group of state attorneys general filed a lawsuit to stop the deal. The final nail in the deal’s approval came in February 2020, when a federal judge ruled that states did not prove that the T-Mobile-Sprint merger would be bad for competition in the wireless carrier space.