Deutsche Telekom and MetroPCS agreed to a $1.5 billion deal that will see the prepaid carrier merge with T-Mobile USA, with the European operator maintaining controlling interest. The announcement came just a day after the first reports surfaced that it was in the works.
There are two very different schools of thought regarding the wisdom of this move: My colleague Kevin Fitchard wrote yesterday that the tie-up makes no sense because of network incompatibilities between the two operators, although those problems will be mitigated by the fact that the two service providers will continue to maintain separate pools of customers, presumably unifying as they deploy a single LTE network. But PCMag.com’s Sascha Segan provided a compelling list of five reasons the merger should work.
One of the under-reported angles here centers on the fate of Dish Network, though, which had long been mentioned as a potential suitor for T-Mobile. Dish owns a substantial amount of spectrum but questions remain whether it truly wants to launch its own wireless network (as it claims it does) or simply spin off its spectrum (if it can clear some regulatory hurdles). Andy Vuong of The Denver Post wrote that Dish could be looking to partner with Sprint, which is certainly plausible. But I’m wondering whether there may still be a chance for Dish to merge with the new T-Mobile/MetroPCS. That might actually threaten the dominance of the two biggest carriers in the nation, which might be more good news for consumers.