Sprint Corp. and T-Mobile US Inc. have agreed that Deutsche Telekom AG would have control in a combination of the two companies, said a person with direct knowledge of the matter.
Nothing is set in stone at this point, however, as sources say negotiators are still weeks away from finalizing a deal. A merger of Sprint and T-Mob US would create a third giant wireless carrier to compete with AT&T and Verizon in the US, and would mean that almost the entire US wireless phone market would be controlled by the three huge telcos. As we've mentioned in the past, Sprint has been hoarding its high-frequency 2.5GHz spectrum, while T-Mobile is building out the 600MHz in low-frequency spectrum that it spent $7.9 billion for during the FCC's auction of television broadcasters' airwaves.
The biggest issue is whether any merger between the No. 3 and No. 4 wireless carriers in the nation would be approved by antitrust regulators. This also shows that Deutsche Telekom isn't quite ready to get rid of T-Mobile US just yet, which is a huge difference from a few years ago, when it was shopping the company around to potential buyers.
"We continue to believe 1) a deal makes sense both strategically and financially (at the right price of course), and 2) the current regulatory environment seems to provide the best window to attempt a transaction".
If a merger were to be completed, it's expected that T-Mobile CEO John Legere would be the leader of the newly-formed Sprint-Mobile. According to screenshots leaked by Android Central, the carrier would let users suck down 50GB of data through their unlimited plans each month before their speeds are throttled down.