Is a Sprint, T-Mobile Merger Good for Consumers?

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March 11 (Bloomberg) -- Harvard Law School Visiting Professor Susan Crawford weighs the pros and cons of a Sprint, T-Mobile merger on Bloomberg Television's “Bloomberg West.” (Source: Bloomberg)

Joining us.

So, what do you think?

Is the sprint t-mobile merger good for consumers?

Price war is always good for consumers, which is what the sprint ceo is promising.

What is really going on here is a fight over the enterprise market.

They want to gain shares there.

Basically, we will have a lot of price-cutting in the consumer market no matter what happens.

This guy says he can take a chunk of the enterprise market if you just let me in.

Otherwise t-mobile will just keep cutting prices and making it more difficult for him to enter into the enterprise market area and -- market.

Is this business higher-margin?

Why is that the goal?

It is the goal because the consumer market is pretty thoroughly saturated.

Just about everybody has smartphones.

There is very little growth right now.

It is a fight over existing market share.

Prices are going to be going down.

T-mobile is doing that right now with its lot -- with its much lower price structure.

Sprint has a relatively high fixed sprint -- price structure at the moment.

They would have to make some pretty big changes.

They have seen no growth on the consumer side.

He said he sees big growth on the enterprise side, where he has high-capacity spectrum to carry lots of information over short distances.

He has got very high band spectrum that goes over very short distances that carries lots and lots of information.

That is great for managed wi-fi.

For businesses.

You could see that as a tremendous market opportunity for him.

Susan, take a listen to the argument that masayoshi son made on charlie rose, when it came to at&t and verizon, and the fight he is preparing for.

Take a listen.

I need to, again, become a heavyweight, right?

[laughter] i cannot be tiny.

That will not work.

They will squish you.


They are enormous.

So that they can stay comfortable and fat.

I want to make them fight back so that they also become muscle instead of fat.

That is good for the united states.

Is there any sense that regulators will back down from this idea that they want for carriers -- four carriers?

At the moment it does not seem terribly realistic.

They have an antitrust division who said that when we mean four, they meant four.

It is hard to see them backing down at the moment.

Some are saying that they should create a monster to take on the other two monsters.

The department of justice may not want to see a monster.

If it is that unlikely, what does masayoshi son get out of it in the end?

Does he sort of know that he is embarking on a losing battle?

Or does he really think he has a good shot?

I think he is using the very high prices being charged by verizon and at&t at these relatively slow speeds as a talking point that he thinks will be very encouraging to regulators.

Also, tom wheeler, the sec chairman said in a blog post before he was confirmed that he could use the opportunity of a merger to propose conditions that he cannot get through the front door as regulators, which is very attractive to the sec as well.

He may want to take advantage of that opportunity.

The recent success of wireless additions at t-mobile, does that suggest to us that t-mobile could stand alone against a stronger competitor?

Ironically their own success has made them less likely to help?

Yes, the additions that they will take -- people say that they will take about one quarter of new additions in the coming year.

They are really attracting buzz and energy.

They are a wonderful company with a great ceo.

I could see them continuing to grow.

I would love to see them standing on their own.

Having their employees out from under deutsche telekom, which is very much like at&t. i think that they have a different character than their parent, at this point.

The last time that i spoke with the t-mobile ceo, he sort of indicated that he wanted to run a sprint t-mobile, nation, if that were to happen.

Who would run the thing?

The person with more money and the deeper pockets will run it.

I think it is unlikely, if anything, that t-mobile will grip -- will gain bulk.

They will try to get more broadband spectrum in the next auction that comes up.

All of that is good for consumers.

All right, susan crawford, author of "captive audience,"

This text has been automatically generated. It may not be 100% accurate.


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