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Business customers are the real winners from the T-Mobile and Sprint merger

Lindsay Notwell

T-Mobile and Sprint merger makes it clear that organizations need to start thinking about their journey toward 5G

Over the summer, news broke that the anticipated $26.5 billion T-Mobile and Sprint merger, which has been in the pipeline for over a year, had been approved by the Justice Department. On Nov. 5, it was officially approved by the FCC. There are still some legal challenges to the deal, but analysts and commentators are optimistic that the merger will be complete before the end of 2019.

The sector is buzzing with predictions about whether AT&T, Verizon or the new company (which will keep the T-Mobile name) will ultimately come out on top. However, Cradlepoint is in the privileged position of working with all the leading 5G carriers. These relationships give us a unique understanding of each carrier’s strengths, roadmaps, and product offerings. To us, it’s clear that each of the three brings something different and valuable to the table.

What is apparent right now is that customers in the U.S. are going to have a very viable third option for 5G connectivity. For organizations all over the world, 5G represents the promise of a wireless WAN future defined by the ability to provide fiber-like performance for people, places, and things for game- and even paradigm-changing applications. Here’s why this new merger is making this more possible than ever.

Verizon and AT&T are neck-and-neck in terms of subscriber base, with extensive Gigabit-class 4G LTE coverage. Pre-merger, Sprint and T-Mobile have subscriber counts that are a distant third and fourth. However, when combined, the new T-Mobile will be extremely close to the other two incumbents. Each will have a subscriber base of approximately 100 million.

Equal population reach and market clout only tell part of the story, however. 5G customers should be excited about the more even distribution of spectrum bands between carriers. Let’s take a few steps back for a moment to understand why: 5G is delivered over a wide range of spectrum bands. At one end are frequencies in the traditional “low” range of 600 MHz to 2,300 MHz (2.3 GHz). These frequency bands are fairly congested by existing users. Historically, they are narrower (i.e. lower bandwidth) than newer, higher frequency bands, but reach very long distances and deep into buildings.

At the other end are millimeter wave (mmWave) bands, which are very high frequency in the 24 GHz to 100 GHz range. These have recently been made available by the FCC and provide very high bandwidth, but by nature, are easily blocked by physical objects. In the middle are so called “Sub-6” or “mid” bands (2.5 GHz – 6 GHz), which generally have wider band width than low but reach reasonably well.

What’s most interesting about the T-Mobile and Sprint merger from a 5G perspective is that it combines each company’s strengths in terms of spectrum bands. On their own, T-Mobile and Sprint both have legacy spectrum in the “low” bands as well as newly acquired mmWave bands by T-Mobile, all of which are the same as the other big players. In addition, T-Mobile won an average of 30 MHz of low 600 MHz spectrum in a recent auction, which is significant not only due to its reach, but since it is effectively new and uncongested, it should be able to deliver better-than-average throughput, at least in the early days. It’s hard to quantify that for a number of technical reasons; however, T-Mobile should be able to deliver download speeds in the low hundreds of megabits per second even before the Sprint merger goes through.

Here’s where it gets interesting – Sprint has significant spectrum holdings in the 2.5 GHz band, which is unique in the U.S. When combined with T-Mobile’s spectrum assets, this combination of low, mid, and mmWave frequencies should make it possible for the new company to deliver fast and reliable 5G coverage, even to businesses or first responders in rural areas. Mind you, outside of mmWave coverage, it won’t be blazing speeds, but the combined network is estimated to deliver around 500 megabits per second, give or take. Perhaps not as fast as mmWave can deliver, but not too shabby given the broader coverage that low- and mid-band spectrum propagates.

There is a great deal of political and corporate desire to bring 5G to the entire U.S. population. It makes sense, therefore, that a more complete spectrum portfolio from a single carrier could have swung the deal. Indeed, the merger is seen by many in the industry as a necessary catalyst to get nationwide 5G coverage rolled out quickly. In fact, because of its combined ownership of licensed spectrum bandwidth, the new T-Mobile could become the first carrier to deliver a very fast, country-wide 5G network—ahead, even, of AT&T and Verizon.

No doubt that this thinking is behind one of the most critical conditions of the deal: T-Mobile must rollout 5G to 97% of the population in three years—and to 99% three years after that. This is excellent news for 5G’s corporate and consumer customers as the technology promises so many life- and business-enhancing applications.

So, all of this is good news for the customer — more competition, more access to the latest tech, and more likelihood of connecting to a 5G network wherever businesses are in the country. The only loser at this time, so far as we can tell, is wired tech.

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