Merger of T-Mobile and Sprint to Cause Serious Ripples in the Softbank Market
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Wireless phones have been around for more than two decades now and the introduction of the smartphone has helped increase the profits for wireless phone companies. Companies that once broke away from the large monopoly of AT&T are now finding a way back to their original state. The recent chain of events and the newest update of the T-Mobile and Sprint merger could possibly damage the Softbank market.
This leaves the US with only three major players in its wireless telecom industry. Softbank Corps, who owns Sprint, is in jeopardy as the merger puts more pressure on them to reduce Sprint’s debt. The merger itself could both be a good news and a bad news for consumers. The good news is that both their wireless technologies would integrate and form something even more beneficial to everyone. The bad news is that this may stifle innovation as you have less players in the market.
Going back many years, we find the same exact problem that had occurred when the US government allowed AT&T to take control of its US based market. Once the company had broken off, companies like Motorola invented the wireless 2 pound brick phone. This idea later on transformed into the iPhone in 2007 when Steve Jobs revealed the revolutionary gadget to the world.
The merger was announced last year and since then, Softbank has been accepting the idea of how working down the huge debt Sprint has could benefit them. This has huge benefits for them as they would now be able to move toward operation expansion to cities like Tokyo. The Tokyo-based SoftBank’s financing options have huge margin for profits as the current projection and aim of the company is to fuel an investment AI. This program would be managing a $100 billion investment fund and therefore holds a large stake in the game for innovation.
All in all, the merger sounds fruitful for both parties, but it does not say anything about the consequences for the American people and world. The companies do promise excellent service and continuous efforts in research and development. They are after all, going to be responsible for shaping the next hundred years that are to come.