AT&T CEO Predicts 'Tough' Merger Road For Sprint, T-Mobile

AT&T Chief Executive Officer Randall Stephenson believes T-Mobile and Sprint have "a tough hill to climb" in order to have their proposed $26.5 billion merger approved by stateside regulators. While speaking at the latest edition of Recode's annual Code conference held in Rancho Palos Verdes, California, Mr. Stephenson suggested the third- and fourth-largest wireless carrier in the United States will likely have an even more difficult time with receiving a regulatory go-ahead for their consolidation than AT&T has with its attempted Time Warner tie-up valued at $85.6 billion. The Dallas, Texas-based telecom giant has yet to merge with Time Warner as its legal battle with the Department of Justice continues, with Washington's antitrust watchdog being unwilling to greenlight the move despite the fact that the deal is a vertical merger and doesn't eliminate any competition from the market.

"Power to them if they get it done," Mr. Stephenson said, indicating AT&T has no plans to oppose T-Mobile and Sprint's attempted tie-up in any capacity, a sentiment that was already expressed by the company's Communications CEO John Donovan earlier this month. The industry veteran's Wednesday speech was the first occasion on which he commented on the merger, though he refused to express a stance on whether the consolidation of the two smaller national carriers should be approved, having maintained that anything he says would be easily twistable due to his own interest in the wireless industry and the fact that AT&T directly competes with both mobile service providers. If combined, T-Mobile and Sprint would be within striking distance of AT&T in terms of subscribers; the second-largest telecom firm in the U.S. presently has over 143 million subscribers, whereas T-Mobile and Sprint have over 127.5 million together, according to their consolidated financial reports for the first quarter of 2018.

AT&T attempted acquiring T-Mobile in 2011 but was blocked from doing so by the Obama administration, with the development marking Mr. Stephenson's first high-profile acquisition failure. The firm is still awaiting a first-instance ruling on its Time Warner dispute with the DOJ. T-Mobile and Sprint said they're hoping their merger will be approved in the first half of 2019, a timeline that some analysts are describing as too optimistic given Washington's recent moves on the antitrust front, including the attempted blocking of AT&T's Time Warner acquisition.

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Dominik Bosnjak

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Dominik started at AndroidHeadlines in 2016. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]