What the T-Mobile-Sprint merger really means for you

What's the T-Mobile-Sprint merger mean to you?

If you’re wondering what the T-Mobile-Sprint merger means for you, then you could just ask the two companies. They’ll promise the world, including lower prices, better coverage, faster connection speeds, and creation of a superfast 5G network.

Or you could talk to consumers and experts who have witnessed previous mergers in other industries. They’ll predict the opposite will happen — including higher prices, spotty service, and perhaps worst of all, the creation of an enormous cell phone company that generates obscene profits.

Who’s right? And what can you do about this corporate marriage, other than watching your cell phone bills go up, and your service go down?

Sprint and T-Mobile earlier this week announced plans for a $26 billion merger, which will create the third-biggest cellular carrier in the U.S. So now’s the time to ask.

Consumers don’t care

This will probably not come as a shock, but consumers don’t care. And consumer advocates haven’t been able to muster anything more than a rhetorical, “Can you see the benefits to consumers?” question.

Talk about a fait accompli.

The cell phone industry scores a miserable 73 out of 100 on the American Customer Satisfaction Index (ACSI). Both T-Mobile and Sprint received average scores, and by “average” I mean they got 73s.

The apathy runs deep. After years of surcharges, fees, dead zones and snotty service, it seems customers have made their peace with the fickle, sluggish connections and you-get-what-you-pay-for attitude.

Sure enough, when I asked consumers for their thoughts on the merger, few believed they’d benefit from this corporate combination.

“Like most mergers, the customer will probably be worse off,” says Jeff Broman, a writer from Tempe, Ariz. “Even though they will spin it that everything will be better.”

“I’ve never seen a merger improve things,” says Darryl Musick, a publisher from Los Angeles. “No reason to change my belief now.”

Like an airline?

Does this remind you of anything else? I noticed another industry with an ACSI score of 73 — airlines. And I remembered the last big airline merger, between American Airlines and US Airways. The promises were strikingly similar. They offered better service and greater efficiencies. In the end, they delivered worse service, higher prices and yes, fatter profits to the newly merged company. I kid you not.

You don’t have to be an industry analyst to know what will happen next. If Sprint and T-Mobile get the government’s blessing to marry (and they will, of course), then it’s just a matter of time before they will follow a trail blazed by so many companies before them.

This rule — that mergers are always better for the company than for the consumer — is so universal that I’ve written it into my nonprofit advocacy organization’s mission statement. It reads: “We’re unaware of any merger that created jobs, improved customer service, lowered prices or increased competition.”

Another cell phone merger and what it meant to consumers

To get an idea of what might happen, consider another cell phone merger in the U.K., between Orange and T-Mobile, says Tonia Baldwin, a corporate director at A1 Comms, a provider of unified business communications services.

“There were good and bad consequences,” she says.

The good? The new combined Orange-T-Mobile rolled out 4G in the UK and with it, network-specific perks, such as two-for-one cinema tickets. Coverage also improved for customers of the combined company.

The bad? The two companies, looking to save £3.5 billion, cut thousands of jobs. The employees who remained complained about unrealistic demands and targets and shrinking commissions. And customers paid, too.
“New customers had bigger bills and higher tariffs to pay,” says Baldwin.

Doug Suttles, who co-founded a site called Speedtest that measures cellular connection speeds, says Sprint customers will benefit more when it comes to service quality.

That’s because T-Mobile has been aggressively deploying 5G-ready infrastructure equipment in the last six months. “These assets will be fully 5G operational once the vendors push over-the-air software upgrades, likely to happen sometime before the end of this year,” he says.

Even if the merger becomes — forgive me — the un-merger, the house always wins.

“My guess is that a merger will ruin T-Mobile and turn it into the pile of no-customer-service trash that I call AT&T and Verizon,” says Delray, Fla.-based business consultant Joe Palko.

Well, we can’t say we weren’t warned.

Share this story
Share on Twitter Share on LinkedIn Share on Facebook

Underwritten by

Elliott Advocacy is underwritten by Cavalry Travel Insurance

Cavalry takes the worry of out travel by providing 24/7 access to medical and security professionals combined with the best medical evacuation and security extraction services. Cavalry gets you home safely when you need it most. Learn more at Cavalrytravelinsurance.com.

Elliott Advocacy is underwritten by Seven Corners

Seven Corners has helped customers all over the world with travel difficulties, big and small. As one of the few remaining privately owned travel insurance companies, Seven Corners provides insurance plans and 24/7 travel assistance services to more than a million people each year. Because we’re privately held, we can focus on the customer without the constraints that larger companies have. Visit Seven Corners to learn more.

Elliott Advocacy is underwritten by Sodexo North America

Sodexo North America Sodexo North America is part of a global, Fortune 500 company with a presence in 80 countries. Sodexo is a leading provider of integrated food, facilities management and other services that enhance organizational performance, contribute to local communities and improve quality of life for millions of customers in corporate, education, healthcare, senior living, sports and leisure, government and other environments daily. Learn more at Sodexoinsights.com.

Elliott Advocacy is underwritten by Travelex Insurance Services

Travelex Insurance Services is a leading travel insurance provider in the United States with over 55 years combined industry expertise of helping people dream, explore and travel with confidence. We offer comprehensive travel insurance plans with optional upgrades allowing travelers to customize the plans to fit their needs. Compare plans, get a quote and buy online at Travelexinsurance.com.

Elliott Advocacy is underwritten by AirHelp

AirHelp is the world’s leading flight delays compensation company, helping passengers apply for compensation following a delayed or canceled flight or when boarding has been denied. It is AirHelp’s mission to fight for passenger rights by holding airlines accountable for flights disruptions that are out of passengers’ control. AirHelp has already helped 5 million people, taking the stress out of applying for compensation and making it as hassle-free as possible for travelers around the world.

Elliott Advocacy is underwritten by Allianz Travel Insurance

The Allianz Travel Insurance company has built its reputation on partnering with agents all around the world to provide comprehensive travel insurance for their clients. Contact Allianz Travel Insurance for a comprehensive list of coverage.

Elliott Advocacy is underwritten by Chubb

Chubb is the world’s largest publicly traded property and casualty insurance company, and recognized as the premier provider of insurance for successful individuals and families in the U.S. and selected international markets, offering coverage for high-value automobile, homeowners, recreational marine/aviation, valuables and umbrella liability coverage. As an underwriting company, Chubb assesses, assumes and manages risk with insight and discipline, and combines the precision of craftsmanship with decades of experience to conceive, craft and deliver the best insurance coverage and services to individuals, families and business of all size.

Elliott Advocacy is underwritten by Enterprise Holdings

A family-owned, world-class portfolio of brands. A global network that spans across more than 85 countries. Some 97,000 dedicated team members sharing common values. And more than 1.9 million vehicles taking our customers wherever they need to go.

Elliott Advocacy is underwritten by Fareportal

Fareportal’s portfolio of brands, which include  CheapOair and  OneTravel, are dedicated to helping customers enjoy their trip. Whether you want to call, click, or use one of our travel apps, one thing is clear: We make it easy to take it easy.

Elliott Advocacy is underwritten by Insuremyrentalcar.com

An independent provider of low cost CDW/LDW insurance for use with rental cars. Up to $100,000 cover with no deductible. Policies available on a per day, per trip or per year basis. Also works with overseas rentals. Try  Insuremyrentalcar.comnow.

Elliott Advocacy is underwritten by Mediacom Communications

The nation’s fifth-largest cable operator, serving the smaller cities and towns in the Midwest and Southern regions of the United States. We are a high-performance broadband, entertainment, and communications company that brings the power of modern technology and quality customer experience to life inside the connected home by combining ultra-fast gigabit speeds with personalized local and over-the-top entertainment choices that fit your lifestyle. Details at  Mediacomcable.com.

Elliott Advocacy is underwritten by Arch RoamRight

Arch RoamRight is one of the fastest growing, most-highly rated travel insurance companies in the United States. Travel advisors love working with us, and travelers feel protected with our trip cancellation and travel medical insurance coverage. We also make it easy to file a claim online with our fast, paperless claims website. Learn more about RoamRight travel insurance.

Elliott Advocacy is underwritten by Virtuoso

The leading global network for luxury and experiential travel. This invitation-only organization comprises over 1,000 travel agency locations with 17,500 advisors in over 45 countries, and holds preferred relationships with 1,700 of the world’s finest travel companies. Virtuoso advisors collaborate with their clients to create personalized itineraries featuring exclusive perks, while also providing advice, access, advocacy, and accountability. For more information, visit  Virtuoso.com.

Elliott Advocacy is underwritten by VisitorsCoverage

As a company that is constantly striving to simplify travel insurance, VisitorsCoverage, is on a mission to help travelers make the better decisions about purchasing travel insurance, quickly. VisitorsCoverage has helped millions of travelers globally to buy the suitable travel insurance and explore the world with confidence. Get insurance for your next trip at  VisitorsCoverage. Lowest Price Guaranteed.

Elliott Advocacy is underwritten by MedjetAssist

Medjet is the premier global air-medical transport, travel security and crisis response membership program for travelers. With a MedjetAssist membership, if you become hospitalized more than 150 miles from home, we will get you from that unfamiliar hospital all the way home to the hospital you trust. All you ever pay is your membership fee. MedjetHorizon members add 24/7 personal security and crisis response benefits. Elliott.org readers enjoy discounted rates. Travel safer with  MedjetAssist.

Elliott Advocacy is underwritten by Southwest Airlines

The mission of Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth.

Elliott Advocacy is underwritten by TravelInsurance.com

TravelInsurance.com makes it fast and easy to compare and buy travel insurance online from top rated providers. Our unbiased comparison engine allows travelers to read reviews, compare pricing and benefits and buy the right policy with a price guarantee, every time. Compare and buy travel insurance now at  TravelInsurance.com.

Elliott Advocacy is underwritten by Squaremouth

Squaremouth helps travelers easily and instantly compare travel insurance policies from all major providers. Only companies that meet the strict requirements of Squaremouth’s Zero Complaint Guarantee are available on the website. Compare policies on  Squaremouth.com to save over 70 percent on your next purchase.

Elliott Advocacy is underwritten by Travel Leaders Group

Travel Leaders Group is transforming travel through its progressive approach toward each unique travel experience. Travel Leaders Group assists millions of travelers through its leisure, business and network travel operations under a variety of diversified divisions and brands including All Aboard Travel, Andrew Harper Travel, Colletts Travel, Corporate Travel Services, CruCon Cruise Outlet, Cruise Specialists, Nexion, Protravel International, SinglesCruise.com, Travel Leaders Corporate, Travel Leaders Network and Tzell Travel Group, and its merger with ALTOUR. With more than 7,000 agency locations and 52,000 travel advisors, Travel Leaders Group ranks as one of the industry’s largest retail travel agency companies.

Elliott Advocacy is underwritten by Travelers United

If you’ve been mistreated by the airlines, Travelers United is your voice in Washington. Join the #1 travel advocacy organization working with Congress to improve and protect travelers. Plus, get $400 of annual benefits you can use for travel for only $29/year. Add your voice to ours. Make travel better.  Join today.