T-Mobile Pricing Seen as Obstacle for Any Sprint Merger

T-Mobile’s pricing strategy is a potential roadblock for any Sprint takeover attempt because US regulators want to preserve a maverick wireless company that offers subscribers lower rates.

T-Mobile is using cheaper plans to gain customers from larger rivals, helping create the kind of competition the Justice Department sought more than two years ago when it sued to keep the company from being gobbled up by AT&T, the industry No. 2 behind Verizon Wireless. Regulators won’t want to disrupt the market dynamic if Sprint reaches a deal to buy T-Mobile, said Jeff Silva, an analyst with Medley Global Advisors. A Sprint bid for T-Mobile “would hit a lot of static from federal regulators and antitrust officials,” Silva said. There isn’t “political appetite for seeing the national field reduced by one, especially if that one is a maverick carrier,” Silva said.