US may be a gamble too far for Masayoshi Son’s SoftBank

Masayoshi Son, the billionaire founder of the telecommunications group SoftBank is entangled in perhaps the biggest gamble of his life. He is taking on America.

SoftBank paid $22 billion for a majority stake in Sprint, the third-largest US mobile provider. The aim is to “do a Vodafone” by using an also-ran carrier as a vehicle to disrupt an entire sector. But those plans ran into trouble. In the face of intractable opposition from US regulators, SoftBank withdrew its plan to combine with T-Mobile, the fourth-biggest carrier, a merger that was central to its strategy. Son is not giving up. He has appointed a new Sprint chief executive, Marcelo Claure to try to reverse the haemorrhaging of Sprint customers, hundreds of thousands of whom have defected in the past year. Although Sprint is making valiant efforts to upgrade its patchy network, it will be hard to catch the two market leaders. They have better coverage and ample cash flow with which to fund investment. If anything, T-Mobile, which has been gaining subscribers faster than Sprint has been losing them, looks like the successful upstart.