Merger of MetroPCS and T-Mobile Gets Regulatory Approval
The wireless carriers, MetroPCS Communications and T-Mobile USA have signed off with the Federal Communications Commissions and the Justice Department. While they claim that it would benefit the competition in the wireless market, the two big shareholders of MetroPCS, Paulson & Co. and P. Schoenfeld Asset Management LP, oppose the deal. There would be a higher competition as the two companies merge because it gives them a higher advantage compared to dominating companies such as Verizon and AT&T. Another benefit that the merging of companies would bring is that T-Mobile is hoping to remove the practice of subsidizing smartphones for customers to exchange for lower monthly bills.
Reading this article brings back the past of AT&T who was unsuccessful in attempting to acquire T-Mobile for thirty-nine billion dollars in 2011. Both AT&T and Verizon are head competitors who control most of the market, so having T-Mobile and MetroPCS merge, can offer more to consumers as well as balance out the markets. The merger still has to be approved by shareholders of MetroPCS by April 12. There are many pros and cons when companies choose to merge and what kind of effect it will have on the consumers, but it also depends on how the company chooses to make future decisions.
Written by: Samantha Chin
Source: The Wall Street Journal
Gryta, T. (2013, March 12). Merger of MetroPCS and T-Mobile Gets Regulatory Approval. Retrieved March 12, 2013, from The Wall Street Journal: http://online.wsj.com/article/SB10001424127887324735304578355960782499532.html?mod=WSJ_business_whatsNews