Sprint CEO Dan Hesse had told Congress that he fears that a T-Mobile acquisition would result in a duopoly that would make it hard for Sprint to compete with, and that a likely scenario as a result would be a buyout of Sprint by larger rival Verizon Wireless. However, the latest report from Bloomberg indicates that CenturyLink, and not Verizon, would be the interested buyer in Sprint should an AT&T-T-mobile deal gets regulatory approval.
Analysts say that CenturyLink is interested in Sprint as it is the biggest telecommunications player in the market without a wireless unit. CenturyLink partners with carriers like Verizon Wireless in select markets where it serves to deliver wireless to its customers.
Other potential buyers include cable companies who are beginning to blur the lines between TV and communications. For example, Comcast already partners with Sprint and its Clearwire partner to offer mobile broadband data on the go using 4G WiMax technologies. Cable companies are already offering phone service and adding wireless phone to the mix would help it offer a package to customers and simplify billing. However, because of regulatory challenges behind an acquisition made by a cable company, CenturyLink remains the most likely buyer according to Piper Jaffrey Cos. analyst Chris Larsen.
Sprint’s other option is to acquire other companies and beef up its network rather than wait to get acquired. The company could make a play for other regional or pre-paid carriers, like Leap and MetroPCS.
Sprint has been vehemently opposed to an acquisition of T-Mobile by larger rival AT&T. Verizon has thus far tried to remain un-involved in the process except to say that if the deal is approved, it may make it easier for the government to get involved and regulate wireless even more, which may be true given Hesse’s fears of a duopoly.