Sprint Corporation merging Boost and Virgin Mobile.

Thanks. It looks like my prediction not too long ago, that was quickly shot down as complete speculation by someone, looks like it is actually happening. Hopefully that user won't return anyway, as they were probably just a repeat troller on this board as well as others.

It's always seemed to be not a financially wise way for Sprint to operate, especially once Boost started the transition to CDMA. I'm sure it will save them a lot of money. I just hope it won't negatively impact all of us customers.

 

What complicates the situation more, is the possibility of a Sprint/T-Mobile merger. I've read speculation that it could win approval if Softbank makes it possible for a "New Entrant" to enter the market. Maybe that is the thinking behind resurrecting Nextel. Since it would immediately have name recognition, it could be a more formidable "New Entrant", that they could spin off, or sell. I found the article below today which is clearer on this, but have heard this scenario before.

Sprint, T-Mobile M&A Seen Hinging On 'New Entrant' Side Deal S TMUS - Investors.com

 

This sounds exactly like what online gaming companies do when they're losing customers... combine servers *cough* Wow *cough*.

 

A lot of companies that are not doing well financially, usually look to combine overlapping functions or units. That why I felt this would happen, and wondered why it didn't happen sooner. When a new owner or partner enters the picture, it is even more likely.

I suspect if the T-Mobile merger happens and Nextel is resurrected, either Sprint or Nextel might become a GSM carrier. My bet would be Sprint, but you never know. I also think that the Nextel brand is going to specifically target business customers, just as it originally did. If a new player is entering a market that already has very strong & powerful competition, the smart one will usually target a specific sub-market that seems to under-served, or nor served in the way it should be, since directly competing usually wont work. Sprint/Softbank May already be planning this out with a 3rd party (The article talks about Dish Network) who may already be making their own plans. This way Sprint & Nextel won't be direct competitors. I'm sure there are at least hundreds of other possible scenarios.

I think all of us Virgin users might be at least a bit up in the air for awhile, until anything becomes official.

 

Actually, it doesn't appear that they will save any money by not using the Virgin Mobile name -- they are contracted, and will have to continue paying for the use of the name, for about 8 more years (I believe 2021). My guess is that they feel there is enough of a negative perception of Boost and Virgin Mobile (in terms of being for poorer people or only for kids, and possibly even a reputation for slow service) that getting rid of the names will help. Otherwise, it seems silly to get rid of brands you've sunk millions of dollars promoting.

I'm fairly sure, based on what Virgin and Boost have previously done, that they will grandfather current customers; the question is what actions (such as getting a new phone) might cause you to lose your plan. As for what plans they'll offer, I somewhat wonder if they might offer a bit of both -- maybe a low end plan similar to the current VM $35 plan with an "unlimited" plan with discounts for paying on time similar to Boosts current plan.

As a consumer, I am very against Sprint buying out T-Mobile. I just don't see the advantage, as Sprint and T-Mobile run on different frequencies and standards, not to mention their coverage largely overlaps. It also should be pointed out that the combined company would control about 2/3 of the prepaid market -- that alone seems like enough of a reason to stop the sale from going through.

 

Technically, all carriers are moving to GSM, as LTE is a GSM technology. This is why LTE phones require a SIM card, though Sprint often tries to hide it by building the SIM card into the phone.

 

I know, but if the whole thing with Nextel is true, and Nextel is either bought by another company or spun off, they may want to differentiate themselves in as many ways as possible, even if it is something like that, so they can avoid being direct competitors in as many ways as possible (at least initially). That's why many sales & spins offs have non compete clauses, for whatever period of time they decide.That's why I said my guess would be Sprint, if Nextel was only going to target business customers. There's a lot of unknowns, and when you have 2 companies like AT&T & Verizon as the only other real competition, they need to take a different approach, and not just sit there, in a far behind 3rd place like Sprint has been doing for a long time. At least T-Mobile has been trying to shake things up with a different approach. That may be the plan that Sprint would continue.

As far as the existing agreement with Virgin. There's no way to know what can happen. It might have already been discussed between Sprint & Virgin. Agreements & contracts between 2 companies can easily be changed, so I don't think that would be a huge consideration.

That's why there will probably be a lot up in air, not just for Virgin, but all of the companies involved. Even if the merger gets started, it will be awhile, maybe a long while before they get approval. Especially if they are going to resurrect Nextel, and get it on it's feet first. They might have that process going for a bit, before they even try to get approval, especially if the government insists that a viable 4th competitor must already exist. Unless they have been planning this a lot longer than has been known.

 

While it is always possible for companies to renegotiate contracts, Virgin has no reason to let Sprint out of their contract without penalties, especially if there will be no "Virgin Mobile USA". Virgin Mobile service provides additional "free" advertising for the Virgin company as a whole. I actually wonder if Sprint has found another carrier to take over the Virgin Mobile name that Virgin found acceptable. My other thought is that Sprint is paying a penalty for breaking their contract, and that Virgin will again own the rights to the Virgin Mobile name.

As others have stated, I really don't see a Sprint and T-Mobile merger being approved; particularly with almost every argument Sprint made against the AT&T and T-Mobile merger being equally applicable to Sprint. Beyond that, the two companies just don't seem to be a good fit, the technologies, frequencies, and even corporate cultures are all different.

 

There's no way for all but a few people directly involved to know, whether Virgin itself hasn't already been brought into this, and might feel they can also benefit. Everything is speculation, and with very limited & mostly unconfirmed information. The fact that it seems knowlede people in the industry are speculating that the Softbank founder is willing to do whatever it takes, makes it sound like there is a lot of strategy, and thinking towards the future that is, and will be used.

The regulators may not approve a merger anyway, but they could also take the stance that there needs to be at least a 3rd very large competitor to balance out the market, since it is much easier for competitors to cooperate on certain things that hurt the free market, without ever actually having any type of direct contact with the other competitor when there is only 2 of them. The more that are added, the more difficult it becomes. It's the same way with people, the more people involved, the more difficult it becomes for everyone to agree on doing something a certain way. The way things have gone, it is unlikely a 3rd very large competitor is just going to materialize.

Personally, I'm not going to change any of my decisions on deciding whether I continue with Virgin, or decide to switch, until things are much more certain, which may be a very long time coming.

 

I think it will be good for VM and Boost subscribers. I wonder how the plan structure will work out but it will work out well for everyone in the end.

 

I am not an industry insider by an any means. Here are just some thoughts on the merger...

I do find the marketing aspect of this interesting. Ever since Sprint acquired Virgin Mobile AND ended push-to-talk service, the merging of the two prepaid brands seemed inevitable. The speed of this will be driven by the new ownership of Sprint, and will probably happen sooner rather than later. A cash buyout can be worked out to make the use of the Virgin brand go away and the contract will not be an issue.

Branding the new prepaid with Sprint's name attached is risky. I can see Sprint wanting to be done with the reputation of Virgin Mobile being the choice of kids and drug dealers and move on to a new brand. Boost has had virtually no marketing done for it. Having Sprint's name attached to the merged brands may cause competition and confusion with the contract side. I think that is now happening with T-Mobile's customers.

When discussing cell phone service providers with my relatively small sample size of friends and business associates, prepaid still carries a reputation of poor service. Sprint contract users seem to feel that the prepaid customers are service-sucking vampires on THEIR network. They are unaware that Sprint owns the prepaid service. This is something the Sprint's marketing gurus will have to figure out. I am excited to see what they will do -- as long as prices don't go up

I also feel the FCC will not allow a Sprint - T-Mobile merger. I like the competition.

Resurrecting the Nextel name makes sense. However, I am not in that market right now and do not care.

In my opinion, the average cell phone user is oblivious as to who provides what service and shops for the phone, not the provider.

 

When the proposed AT&T/T-Mobile was announced, I didn't think it would be approved. But, I do feel this has a good chance. I'm not saying I like less options, but they may feel that, if it is not allowed to happen, that at least one or both of Sprint & T-Mobile may eventually close down, since they do not really have any other line of business to keep them going. At some point, one or both won't be able to continue losing money, and the situation will be even worse.

A lot of what has happened, I feel could have been avoided, if the government had handled things differently earlier on in the evolution of the cell phone industry. I think there should have been 1 technology standard adopted, as well as enticing companies to build networks that could be leased out, but they might have been restricted from also owning any company that operates on them, along with many other possibilities, would have made it easier for smaller companies to compete, since this is an industry that can require huge infrastructure investments to operate on your own. The fact they've basically allowed the pre-break up MaBell/AT&T, to basically re-assemble itself using both parts of it's former self, and new parts, into 2 very large free market competitors, instead of 1 heavily regulated monopoly has not helped.

they kept saying that the tele-communications industry is completely different, and it is in many ways, but in reality, on a business level that has not mattered all that much.

 

I believe that we will see sprint really push hard and male some serious changes in the next few years.

 

Based on this quote from the article_
"According to sources speaking to TechCrunch, Sprint is planning to combine Boost Mobile and Virgin Mobile into a single service known as "Sprint Freedom. "

I'd say this is pretty much up in the air as the sources were not revealed it's all speculation in an article on the internet so far, nothing is official. I don't think Phonedog wants to go way out on a limb but they kinda covered their selves with this quote if nothing comes of it.

Just my thoughts!

 

Actually today when I was on the phone with Boost Mobile I asked the customer care rep about the merging of VM and Boost and she said that they were "not allowed to talk about Sprint Freedom yet"
She also said that soon we would be getting emails sent out regarding future plan changes and updates.

This was an American rep

 

Because of the whole Sprint/T-Mobile merger issue as well, whatever near term changes are made, does not necessarily mean things are going to stay that way for any length of time. There could be lots of fairly constant changes caused by this issue, or maybe none. It's something to be aware of though. It could be a long time before the dust completely settles.

 

There sure are a lot of folks who know exactly what Sprint needs to do.......
Softbank has a lot of money and they are willing to spend it.
Sit back and enjoy the ride folks

 

Let's just hope that Sprint Freedom keeps the $35 and upgrades their slow internet.

 

Overnight, my lg f3 downloaded an update to android. What i noticed is that when you go into my account / deals, it says see what current phone deals are for boost mobile.