T-Mobile USA Now Reportedly In Talks With Clearwire

[ComicalMoodyDan]

T-Mobile USA Now Reportedly In Talks With Clearwire

This is the tie-up that finally makes sense. After several rumors surfaced saying that Deutsche Telekom’s T-Mobile unit is in talks with Sprint, Bloomberg is reporting that Bellevue-based T-Mobile USA is also in discussions with a company much closer to home.

According to unnamed sources, talks are underway between T-Mobile and Clearwire (NSDQ: CLWR), located just a few miles away in Kirkland. Clearwire would allow T-Mobile to catch-up with the competition because it has the spectrum needed to build a 4G network. Meanwhile, the partnership could be attractive to Clearwire because it would provide additional capital and add some clout as it builds out a first-of-its-kind network in the U.S. Craig Moffett, an analyst at Sanford C. Bernstein & Co. who didn’t favor a T-Mobile-Sprint (NYSE: S) merger because of all the network technologies involved, said: “This would be an answer that would be good news for everyone. It helps check the box for T-Mobile, which is desperately seeking a 4G answer.”

Bloomberg reports that the talks also involve Sprint Nextel because it owns 51 percent of Clearwire, and that T-Mobile is also considering a partnership with MetroPCS Communications, which also has access to additional spectrum.

Although a T-Mobile-Clearwire partnership makes the most sense, it’s not without some hiccups. First off, Clearwire already has plenty of partners, including Sprint, three cable operators and Google (NSDQ: GOOG). It also has picked WiMax for its network technology, whereas T-Mobile’s alliances lie with LTE. However, Clearwire has said before it would be willing to consider LTE, or in this case maybe T-Mobile would be willing to WiMax, which would give them a head start in the U.S.

Deutsche Telekom’s T-Mobile USA Now Reportedly In Talks With Clearwire | paidContent:UK

[Yugopro]

clwr closed at $8.71, down .26¢, so the market does not seem to be too excited.

[RadioRaiders]

Originally Posted by ComicalMoodyDan

Although a T-Mobile-Clearwire partnership makes the most sense

Clearwire, mainly owned by Sprint, is building a WiMAX network on 2.5Ghz, while T-Mobile plans to build LTE on 1700 and 1900Mhz. How does that merger make sense? If they merged with someone who owns 700/800Mhz spectrum and already had a GSM/UMTS network, that would make sense.

[Fire14]

Here is another article about the possible merger talks

Deutsche Telekom Said to Be in Talks With Clearwire (Update3)

Deutsche Telekom AG is in talks to gain access to airwaves controlled by Clearwire Corp. and MetroPCS Communications Inc. as the German company seeks to expand U.S. networks, said two people familiar with the matter.

Europe’s biggest phone company is looking for the most cost-effective way to build nationwide networks using high-speed technology, according to one of the people, who declined to be identified because negotiations are preliminary. Sprint Nextel Corp., which owns 51 percent of Clearwire, is also involved in the talks with Bonn-based Deutsche Telekom, the people said.

Clearwire said in August it needed $2 billion by year-end to complete its own network expansion, and Deutsche Telekom could provide funding in exchange for access, one of the people said. MetroPCS and Clearwire each own airwaves suitable for fourth-generation networks, which can provide faster service for Web-equipped phones than their predecessors.

Deutsche Telekom’s T-Mobile USA unit, whose subscriber gains have slowed in five of the past six quarters, has yet to announce its own expansion plans. Larger rivals Verizon Wireless and AT&T Inc. are already upgrading their systems.

“This would be an answer that would be good news for everyone,” said Craig Moffett, an analyst at Sanford C. Bernstein & Co. in New York, who doesn’t own shares in any of the companies. “It helps check the box for T-Mobile, which is desperately seeking a 4G answer.”

Share Performance

Clearwire rose 18 cents, or 2.1 percent, to $8.97 at 4 p.m. New York time on the Nasdaq Stock Market, while MetroPCS was unchanged at $10.04 on the New York Stock Exchange. Deutsche Telekom rose 0.3 percent to 9.33 euros in Frankfurt. Sprint gained 4 cents to $4.29 in New York trading. The stock surged the most in five months last week after the Sunday Telegraph reported Deutsche Telekom was considering a bid for Sprint.

Deutsche Telekom is unlikely to make an offer for all of Sprint, according to one of the people.

“This deal would involve significantly less money, but still allow T-Mobile to offer 4G services,” Dave Novosel, an analyst at Gimme Credit, wrote in a report. “It would avoid the burdensome integration process and considerable up front costs of assimilating operations.”

Clearwire uses the WiMax standard, which is as much as four times faster than the average speeds on older networks. Clearwire says it believes it holds more airwaves than any other carrier in the U.S., according to a regulatory filing. The company combined its fourth-generation services with Overland Park, Kansas-based Sprint last year.

U.S. Expansion

Sprint spokesman James Fisher and Susan Johnston, a spokeswoman for Kirkland, Washington-based Clearwire, declined to comment. Deutsche Telekom spokeswoman Anna Bischof and MetroPCS spokesman Jim Mathias also declined to comment.

AT&T and Verizon, the two biggest U.S. phone companies, are using a different fourth-generation standard known as long-term evolution, or LTE. Verizon Wireless, based in Basking Ridge, New Jersey, plans to start selling LTE service by the middle of next year.

MetroPCS, based in Dallas, agreed in March 2008 to pay more than $300 million for part of the 700 megahertz spectrum, which can be used for fourth-generation services. Verizon Wireless is using that same spectrum for its LTE network.

Deutsche Telekom gets 24 percent of its revenue from T- Mobile USA, ranked fourth in the U.S. in terms of subscribers. Sprint, the No. 3, and T-Mobile have reported falling revenue as larger AT&T and Verizon lured away contract customers. Sprint’s sales dropped 10 percent last quarter, while T-Mobile’s declined 2.3 percent.

Bloomberg.com: News

[scotsboyuk]

Originally Posted by Fire14

[B][U][COLOR="Blue"]

Europe’s biggest phone company ...

I thought that was Vodafone? I suppose Deutsche Telekom may have more customers actually in Europe though.