Softbank, the majority owner of Sprint, is in talks about a possible Sprint Charter merger, according to a report from the New York Post.
The move comes just days after discussions about a Sprint T-Mobile merger were called off and just a few months after previous discussions about a Sprint Charter merger were ended.
Sprint Charter Merger?
According to the New York Post report, which quotes two unnamed sources, the Sprint Charter discussions may be at an early stage but include high-level executives.
Sprint has been struggling in a competitive wireless market and while some might say that a merger with rising wireless company T-Mobile would have been the best move, Softbank reportedly was unwilling to give up control of the merged entity.
Charter last year completed a major merger of its own with two other cable operators — Time Warner Cable and Bright House.
The main motivation for a Sprint Charter merger would be for the companies to gain an edge and improve their economics in an increasingly converged market in which video viewing is becoming increasingly mobile. Charter already has a deal to resell Verizon wireless and has considerable Wi-Fi resources to support a hybrid Wi-Fi/ cellular offering. But economics would be improved if the company had its own cellular network.
Meanwhile, companies whose primary focus is on communications each seem to be taking their own path as video takes on greater importance. Verizon’s AOL and Yahoo purchases were focused on advertising opportunities with content secondary, while AT&T bought DirecTV and is seeking to buy Time Warner primarily to gain their content, with advertising offering secondary opportunities.
A merger with Charter potentially could open up both content and advertising opportunities for Sprint. The question is whether that would be the best opportunity for it to gain badly needed wireless market share.
I just don't see how a merger between Sprint/Softbank and Charter would be a good decision. Sounds like Softbank needs some stronger leadership who can place customer experience at the forefront of the company goals.
What we've learned from foreign-owned companies like T-Mobile, is that management often sees its overseas investment as a profit center. Foreign-owned companies often fail to increase quality of service unless they have strong state-side leadership like John Legere, whom is passionate about righting the ship and focus on what customers think of the services delivered. Marcelo Claure has failed.
There comes a period of time when companies can become too top-heavy to be manage to deliver quality services. In kansas it seems if you can't get a signal, the phone or device is at fault, the new one has an extendable antenna, and Brightstar will ship a new one as long as you enter into a new 24-month contract. However, the service sucks because Sprint's customer service is designed to turn their back on any and all customer requests until month 23.
Charter doesn't have any contracts.