Boston, MA 08/20/2014 (wallstreetpr) – The merger deal between T-Mobile US Inc (NYSE:TMUS) and Sprint Corporation (NYSE:S) failed to materialize as the regulators denied the approval and made it clear that the four-way battle is a must for maintaining downward pressure on prices favoring consumers. With the denial, T-Mobile and Sprint dreams to combine as a single entity for posing the challenge to other players came to an end.
The pricing war
Now when there is no chance of a future deal, Sprint and T-Mobile are finding ways to gain market share with the new plans in the industry. Sprint has announced the scrapping of “framily” plan that will be replaced by a cheap, data-heavy plan of $100-per-month. It will offer 20 gigabytes to the consumer. The new plan will offer up to ten lines. Also, Sprint Corporation (NYSE:S) is promising to pay up to $350 to end a contract with the rival mobile carrier. It will be interesting to watch out how the things playout for Sprint especially at a time, when it has also got a new CEO Marcelo Claure at the start of this month. It is exactly what the government wanted to achieve in the wireless phone industry. Investors are getting wary with the new price war.
The challenges
T-Mobile should prepare itself to face the new challenges posed by the peers. Sprint is making all the efforts for discount hunting subscribers. Both the carriers will try to introduce better deals for the customers to enhance their market share in the competitive industry. However, John Legere, the CEO of T-Mobile said that they offer wallet-pleasing and consumer friendly services in the industry. Sprint is backed by Japanese giant Softbank, and T-Mobile US Inc (NYSE:TMUS) has got the support of Deustche Telecom. The market participants will wait and watch how the two big players carryon their offer fight in the coming quarters.
