MetroPCS, T-Mobile Near Deal
Deutsche Telekom AG, the German company that owns T-Mobile, has been trying to get rid of the U.S. brand for several years instead of injecting its own capital into improving T-Mobile's mobile network to better compete with Verizon Wireless and AT&T. A merger with MetroPCS would inject fresh outside capital into T-Mobile while leaving Deutsche Telekom in charge.
The effect of a deal on MetroPCS customers might be very little. T-Mobile customers are likely to benefit if the company can smoothly integrate the two companies' technologies.
T-Mobile has been losing customers to AT&T, Verizon and Sprint and is likely to lose more this fall as subscribers jump to the new iPhone 5, which isn't being carried by T-Mobile.
Texas-based MetroPCS, which has used the same mobile technology as Verizon rather than T-Mobile, offers month-to-month contracts to customers and has a faster network than T-Mobile in many places. In creating that faster network, MetroPCS has dumped the old technology.
MetroPCS offers a $55 everything unlimited plan on 4G LTE, among the best offers in the cell phone industry.
MetroPCS Chief Operating Officer Tom Keys told FierceWireless in August that every mobile carrier needs more space in the airwaves to send mobile signals and that merging two companies was one way to make that happen.
"It would probably be a better time to do it now than any other time you can think of in the recent past," he said. "Now, how, who, why, where and what--that's going to be up for debate. But at the end of the day, I think what you've seen with the AT&T/T-Mobile deal is that there's at least two companies that thought that consolidation was a good thing. So if you take that as a precursor, yes--[but] under the desire that we always a provide a good experience for the consumer and the consumer doesn't get harmed by having artificially higher rates because you have one less competitor."
But not everyone thinks buying MetroPCS is the best way for T-Mobile to increase its space -- or spectrum -- in the airwaves. At GigaOm, Kevin Ftchard says, T-Mobile has better options.
The news of the talks comes just days after T-Mobile's new chief executive, John Legere, claimed his post.
MetroPCS, which originally launched in Northern California, has a significant subscriber base in Southern California as well.