How the Sprint and T-Mobile Merger Will Affect You
Of course, the most important question to ask yourself when your friends are getting married is: how will this affect me.
Don’t worry, we’ll go through everything you need to know, whether you’re an existing customer of one of these companies (or their prepaid partners), or just a curious consumer.
But first, a little background on this union (feel free to skip down to our recap if you just want to know what’s going to happen to your cell phone service and bill).
You can read more about how mobile carriers are responding to the pandemic in our updated article.
A short history of the Sprint and T-Mobile merger
Let’s go back to the early years of cell phones, the 1990s. In the early ’90s we had a whole bunch of small mobile phone carriers with weird names, like Nextel, McCaw Cellular, and Air Touch. It was the Wild, Wild Wireless West back then.
But a lot of that changed with the Telecom Act of 1996.1 This act loosened federal regulation of the telecom industry, making it easier for companies to buy each other out. It didn’t take long for smaller companies to consolidate into the Big Four mobile carriers we know today.
For a long time the Big Four—T-Mobile, Sprint, AT&T, and Verizon—and their prepaid equivalents have ruled the industry, making it nearly impossible for new companies to compete. Well, now the Big Four is becoming the Big Three.
With the closing of T-Mobile and Sprint’s $30 billion (that’s 30,000 millions!) deal, there will basically be just three choices for mobile consumers. Some experts fear that this consolidation will decrease competition and raise prices.
But other experts argue that T-Mobile and Sprint were not able to compete with AT&T and Verizon anyway, especially in the emerging 5G market.2 These experts suggest that the merger will lead to better service and coverage for most mobile customers.
Of course, there’s a chance that DISH will grow into a new telecommunications giant and we’ll be back to a Big Four. The company will buy up Sprint’s prepaid brand, Boost Mobile, as part of the merger. But DISH has a long way to go before it could really compete.
Only time will tell how this will all shake out. The merger is official on paper, but it will take several years for the industry to really feel the effects. Speaking of which, let’s talk about what changes customers can expect to see in the coming months and years.
How the merger will affect Sprint customers
So, it’s not surprising that Sprint will be absorbed by T-Mobile in this merger, and not vice versa. And this means that Sprint customers will face more changes than T-Mobile customers.
If you’re worried about price increases (who isn’t?), then you’ll be happy to hear that T-Mobile guaranteed they won’t raise prices on existing Sprint customers for at least three years.3 After that . . . well let’s just say that any big corporation is going to try to make as much money as possible.
Sprint customers may also find that, eventually, they’ll need to purchase a new device that’s compatible with T-Mobile’s network. This will affect those who have older devices that use CDMA technology (T-Mobile’s 3G network uses a different technology, called GSM).
But most Sprint customers—those who use newer iPhone and Samsung phones—will not need to upgrade their devices in order to get on the T-Mobile network. Even those using older devices will be fine in the midterm because T-Mobile won’t switch Sprint customers over to its network immediately.
Your plan and billing will also stay the same for now. Sprint is still your network, and you’ll receive the same perks and privileges that you did before the merger. You might even see increased network coverage in areas that are covered by T-Mobile.
If and when there are changes in your plan structure or billing, you’ll be informed by T-Mobile and given alternative options. Hopefully the company will grandfather in those who have legacy plans (like that awesomely cheap $35 Kickstart Unlimited plan).
How the merger will affect T-Mobile customers
If you’re a T-Mobile customer, then it looks like you’re on the side of the bigger fish, so to speak. Because the Big T will be gobbling up Sprint, your plan, pricing, and perks should stay the same, at least for the next couple of years.
T-Mobile’s promise not to raise prices for three years will also apply to those who have current T-Mobile plans.
Eventually, T-Mobile customers will benefit from increased network power once Sprint’s network is merged into T-Mobile’s. They will also see a faster rollout of 5G technology (more on that below).
How the merger will affect prepaid customers
The current mobile industry is awash with mobile virtual network operators (MVNOs), which use the networks of the Big Four to bring service to their prepaid plans. Many of these companies, like Simple Mobile and Mint, use T-Mobile and Sprint’s networks.
Customers on most of these prepaid MVNO plans should not experience any changes to their pricing, service, or plans in the coming months. However, eventually these smaller companies will have to rearrange their plans as the T-Mobile and Sprint networks merge. At that point there could be price increases, or some MVNOs could fold altogether.
There are some exceptions to this. Specifically, Sprint is already in the process of closing Virgin Mobile and migrating the company’s customers to Boost Mobile plans.
Meanwhile, Boost Mobile is being sold to DISH under the conditions of the merger. The company will maintain access to T-Mobile’s network for at least seven more years.4 But, eventually, DISH may try to expand Boost’s service to compete with the Big Three.
What else will change after the merger?
There is a potential that some (or perhaps many) of Sprint’s brick-and-mortar stores could close or convert to T-Mobile stores. In other cases, T-Mobile stores may close their doors.5 (Right now most of these stores are closed anyways, due to the COVID-19 outbreak.)
Another thing that cellular consumers should keep an eye on is T-Mobile’s 5G rollout. While the company has already begun offering limited 5G service in select locations, it should ramp up its 5G network much faster now.
So, if you’re looking to get in on the next generation of mobile technology, T-Mobile is not a bad company to go with. Just make sure you have a 5G-capable device.
Recap: How will the merger affect you?
The short answer is: no one knows for sure yet. But there are a few things that we can say with confidence.
- Sprint will be absorbed by T-Mobile, and eventually Sprint customers will migrate to the T-Mobile network.
- T-Mobile will not raise prices for existing customers in the next three years. This includes people on T-Mobile, Sprint, and prepaid plans.
- For now, both T-Mobile and Sprint customers will continue to pay their bills as they have in the past.
- Sprint customers may see immediate benefits, like access to T-Mobile’s network towers.
- Most customers will be able to keep their current phones. However, some Sprint customers with older phones may need to upgrade eventually to be compatible with the T-Mobile network.
We’d love to hear from you, Sprint and T-Mobile customers. How is the merger affecting your service, bills, and plan perks? Chime in down below.
- Federal Communications Commission, “Telecommunications Act of 1996”
- Digital Trends, “What Does Sprint and T-Mobile’s Merger Mean for You? We Asked the Experts”
- The New York Times, “T-Mobile Closes Merger with Sprint, and a Wireless Giant Is Born”
- Fierce Wireless, “What’s ahead for Sprint and T-Mobile’s MVNOs?”
- T-Mobile and Sprint Facts, “T-Mobile Already Exploring Closure of Retail Stores If Merger With Sprint Approved”