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Why the Sprint/T-Mobile merger could actually help the spread of 5G

Both Sprint and T-Mobile have made promises about when their customers in the U.S. would start seeing 5G coverage. In spring 2018, when the two telecommunications heavyweights first announced they would be merging, their CEOs wrote a joint “open letter to consumers” promising “5G for all.” Almost two years later, with the long-foreshadowed Sprint-T-Mobile merger now legally approved, it looks like it could actually happen, experts say — but those in underserved non-urban areas may have to keep waiting.

“This merger is very beneficial for T-Mobile, but it’s also beneficial for the U.S., and where we currently are in the global race to 5G,” said Steve Vachon, an analyst at Technology Business Research. “Now, the 5G plan is much more likely to go forward.”

John-Legere-T-Mobile-CEO
T-Mobile

“The paths are clearer for the new T-Mobile to really complete its 5G deployment,” said Bernard Borghei, co-founder and executive vice president of operations for Vertical Bridge, the largest private owner and manager of communication infrastructure in the U.S.. “I am very optimistic, barring any unforeseen economic catastrophe or something else not on the radar, under normal course of business, you will certainly see the New T-Mobile continuing to disrupt the industry in a positive way, and will put AT&T and Verizon under more pressure.”

The merger both bails Sprint out of a tough financial situation and gives T-Mobile access to the 2.5GHz (gigahertz) spectrum that Sprint owned. The spectrum provides wavelengths that move at faster speeds than how most U.S. consumer mobile devices currently operate. “Having that spectrum will mean T-Mobile will have faster speeds in the long term,” Vachon told DT.

The timeline and where, exactly, the New T-Mobile will deploy remain fuzzy. Neither company responded to a request for comment, but T-Mobile has said it is aiming to be in 52 percent of all U.S. zip codes by 2024. Borghei was confident that in five to six years, customers would see “a massive improvement” in rural coverage.

“I do believe they’re targeting more of the underserved markets,” Vachon said. “Verizon [the country’s biggest mobile provider] will be targeting the urban markets, so T-Mobile will be more suburban and rural. Nationwide coverage is definitely their intent, but it’s going to be a gradual deployment for the rural markets.”

“You’re going to continue to see concerted effort to get out to rural areas, but we are a vast country, and it will take time,” Borghei said to DT. “I can’t tell you that by 2021 everyone will have coverage. We have the top 60 markets to build out, and they need to make money off of their investments.”

“They’re going to be selective. They have to be where the best ROI [return on investment] is, and where it makes sense to be,” said Vachon.

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