Sprint and SoftBank Merger: What Happened and Why

No, Sprint is no longer merging with Japanese giant SoftBank because the merger already happened and was completed in 2020. Sprint and SoftBank-owned T-Mobile US combined on April 1, 2020, and Sprint ceased to exist as a separate brand, with SoftBank retaining a minority stake in the combined company. This article explains the full timeline, the reasons behind the deal, the regulatory battles, and what it means for former Sprint customers.

Background: Sprint, SoftBank, and the Road to Merger

Sprint Corporation was a major American telecommunications company, once the third-largest wireless carrier in the U.S. SoftBank Group, a Japanese multinational conglomerate led by Masayoshi Son, acquired a controlling stake in Sprint in 2013 for about $21.6 billion. At that time, SoftBank hoped to challenge the U.S. wireless market leaders, Verizon and AT&T, by combining Sprint with T-Mobile. However, regulatory concerns and opposition from the U.S. government blocked the first attempt at a Sprint-T-Mobile merger in 2014.

After years of struggling to compete, Sprint and T-Mobile announced a new merger agreement in April 2018. The deal was valued at approximately $26 billion (all-stock transaction). It took nearly two years of intense regulatory review, legal challenges from state attorneys general, and public debate before the merger was approved and completed.

Why Did Sprint Merge with T-Mobile?

Sprint’s merger with T-Mobile was driven by several strategic and financial pressures:

• Competitive disadvantage: Sprint had a smaller network and fewer customers than Verizon and AT&T, and it was losing money while investing heavily in network upgrades.
• Financial losses: Sprint had accumulated massive debt and was spending billions on spectrum licenses and network improvements without gaining market share.
• 5G race: Both Sprint and T-Mobile believed that combining their spectrum holdings and network assets would allow them to build a more robust 5G network faster and more cost-effectively than going alone.
• SoftBank’s support: SoftBank, which had invested billions in Sprint, saw the merger as a way to salvage its investment and exit the U.S. wireless market as a major operator.

The merger was framed as a “merger of equals” but was structured as T-Mobile acquiring Sprint. T-Mobile’s parent company, Deutsche Telekom, became the majority shareholder of the combined entity, while SoftBank received a minority stake (about 24% initially, later reduced).

The Regulatory Battle and Legal Challenges

The merger faced significant hurdles. The U.S. Department of Justice (DOJ) and the Federal Communications Commission (FCC) had to approve it. In 2019, the DOJ approved the merger with conditions, including the divestiture of Sprint’s prepaid business (Boost Mobile) to Dish Network to preserve competition. The FCC also approved it in late 2019, with similar conditions.

However, a coalition of 13 state attorneys general and the District of Columbia filed a lawsuit to block the merger, arguing it would harm consumers and reduce competition. The case went to trial in December 2019. In February 2020, the federal judge ruled in favor of the merger, rejecting the states’ arguments. The states appealed but later settled after the merger was completed.

What Happened After the Merger?

The merger was officially completed on April 1, 2020. The combined company operates as T-Mobile US, with headquarters in Bellevue, Washington. Sprint’s brand was phased out; by August 2020, Sprint stores were rebranded as T-Mobile, and Sprint customers were migrated to T-Mobile’s network and billing systems. The Sprint name disappeared from the market, though some legacy Sprint plans and services continued for a transitional period.

SoftBank retained a minority stake in T-Mobile US but gradually sold down its holdings. By 2021, SoftBank had sold a significant portion of its shares, and by 2023 it had divested most of its remaining stake. Masayoshi Son’s vision of a SoftBank-led U.S. wireless powerhouse did not materialize, but SoftBank did profit from the sale of its T-Mobile shares.

Impact on Consumers and Competition

The merger reduced the number of major national wireless carriers in the U.S. from four to three (Verizon, AT&T, and T-Mobile). Critics argued this would lead to higher prices and less choice. Proponents countered that the merged company would be a stronger competitor, offering better coverage and faster 5G deployment.

In practice, T-Mobile has aggressively expanded its 5G network and has often offered competitive pricing and promotions. However, some former Sprint customers experienced billing issues, network migration problems, and changes to their plans. Sprint’s legacy CDMA network was fully shut down in 2022, forcing Sprint customers to move to T-Mobile’s LTE and 5G networks.

SoftBank’s Role Today

SoftBank is no longer a major player in the U.S. wireless market. After the merger, SoftBank’s stake in T-Mobile was its largest remaining asset in the U.S. telecom sector. However, SoftBank’s focus shifted to its Vision Fund, investing in technology startups worldwide. The company has sold most of its T-Mobile shares to fund other investments and buybacks. As of 2024, SoftBank’s stake in T-Mobile is negligible, and it has no operational role in the company.

Frequently Asked Questions

Is Sprint still a company?

No, Sprint Corporation no longer exists as an independent company. It was merged into T-Mobile US in April 2020, and its brand was retired. All Sprint customers were moved to T-Mobile’s network and billing systems.

Did SoftBank buy Sprint or T-Mobile?

SoftBank bought a controlling stake in Sprint in 2013. It did not buy T-Mobile. The 2020 merger was between Sprint and T-Mobile, with SoftBank receiving a minority stake in the combined company.

Why did the merger take so long to complete?

The merger was announced in April 2018 but faced regulatory scrutiny, a lawsuit from state attorneys general, and complex conditions imposed by federal regulators. The legal challenges and the need to divest assets (like Boost Mobile) delayed the completion until April 2020.

What happened to Sprint customers’ phones?

Most Sprint phones were compatible with T-Mobile’s network, but some older devices required replacement. T-Mobile offered free or discounted upgrades to affected customers. The CDMA network was shut down in 2022, after which Sprint-only phones stopped working.

Did the merger lead to higher prices?

Studies and consumer reports have shown mixed results. While T-Mobile has continued to offer aggressive promotions, some analysts argue that the reduction in carriers has led to higher prices for certain plans over time. The full long-term impact is still debated.

Is SoftBank still involved with T-Mobile?

SoftBank sold most of its T-Mobile shares by 2023 and has no active role in T-Mobile’s operations. It is not a major shareholder anymore.

Related

• Kodi TV Boxes: What They Are & How They Work
• How Wordle Chooses Its Daily Answer (Not Random)
• Selenium 4 Java End-to-End Tests: Step-by-Step