According to a new report from Bloomberg, the U.S. Department of Justice could have a very specific — and outrageous — demand in mind before it will approve the T-Mobile-Sprint merger. The rumor stems from an unidentified “person familiar with the matter.”
This anonymous source claims that the DOJ will demand that T-Mobile and Sprint create a fourth carrier in order to win government approval for their merger. In other words, to get the deal approved, T-Mobile and Sprint would combine (reducing the Big Four carriers to just the Big Three), and then create a new company — with its own network and everything.
It’s going from Big Four to Big Three and then back to Big Four again, which doesn’t make much sense.
This rumored demand puts the T-Mobile-Sprint merger in a near-impossible situation. How could the two companies create a new company — with its own network — that would compete with Verizon, AT&T, and the “new” T-Mobile? How can you create a company that would compete with your own company? Why would the DOJ think that would be a good idea?
If this demand is true, this would be a new burden for the “new” T-Mobile on top of its other burden: selling off the Sprint-owned Boost Mobile to get the deal approved.
Granted, this is just a rumor at this point. However, if it is true, the T-Mobile-Sprint merger would likely not get approved, as this seems like far too daunting of a task for T-Mobile to actually consider.