Amid ongoing talks about a T-Mobile and Sprint merger, we’re now hearing that a fourth US carrier could be in the making. According to the New York Post, Google may be in talks with satellite-TV giant Dish Network to create a fourth US carrier.
Citing sources close to the situation, the news outlet claims Alphabet director Alan Mulally is in discussion with Dish about creating a carrier.
“There’s no question they are talking,” a source told the Post. However, the source also said the talks are “in flux” and could fail.
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This report follows previous reports about a T-Mobile and Sprint merger, claiming Dish could buy assets from the two carriers. The Post claims Google and Dish will use the assets acquired from T-Mobile to create a fourth US carrier.
T-Mobile and Sprint have been making efforts for the merger since late last year. A merger would help them better compete with Verizon and AT&T. However, the Department of Justice has not yet approved it over concerns that it would leave consumers with one fewer choice.
However, if what the Post is claiming about the fourth US carrier is true, then the government might approve the T-Mobile and Sprint merger. After the merger, Dish could assume the role of the third carrier with help from Google. It can be assumed that the search giant would be responsible for providing the back-end infrastructure to manage the massive network.
According to the New York Post, the new network may launch in about three years. The news outlet also claims that US regulators have no apparent concerns over Google helping another company become a fourth US carrier.
However, T-Mobile parent Deutsche Telecom has apprehensions about Google’s role. According to the Post, Deutsche Telecom insists that it will only sell assets to Dish if it promises not to sell more than a 5% stake to a third party. Google has tons of experience when it comes to the U.S. mobile market, and this may be why Deutsche Telekom is trying to limit Google’s role. With Google’s help, it could be very easy for Dish to launch a mobile service.
“If you’re DT, you have to consider whether enabling Google is worth it,” BTIG analyst Walter Piecyk said, according to the New York Post.
It shouldn’t come as a surprise that Google may be planning to launch a major carrier service. Since 2015, the search giant has been running a mobile virtual network operator (MVNO) using broadband from T-Mobile, Sprint and U.S. Cellular. The search giant also rebranded Google Fi late last year, and now it seems it is targeting more wireless users. A deal with Dish would also help Google boost its fast-growing cloud-computing business and compete effectively with Amazon and Microsoft.
“The cloud is becoming more reliant on the last-mile providers,” Piecyk said, according to the New York Post. “It’s in Google’s interest to make sure the last-mile provider is inexpensive.”
Dish, which has spent about $20 billion to acquire wireless spectrum, could help Google Fi at least reduce its dependence on T-Mobile and Sprint. However, Google has denied the report about a deal with Dish to create a carrier.
“These claims are simply false. Google is not having any conversations with Dish about creating a wireless network,” the search giant said in a statement.
However, the company declined to comment on whether Mulally is in talks with Dish.
FCC Chairman Ajit Pai is already in support of a T-Mobile and Sprint merger, but approval is still needed from DoJ antitrust chief Makan Delrahim. A decision by the DoJ is still a few weeks away.
The T-Mobile and Sprint merger is also facing backlash from several state attorneys-general. These state attorneys-general believe a merger would reduce competition, resulting in higher prices for end users and loss of jobs.
The T-Mobile and Sprint merger comes at a time when US carriers are engaged in a cut-throat war to win new users. Major carriers are offering unlimited data and various freebies, such as access to Netflix. For instance, Sprint is still offering a year of service free to woo subscribers. Such intense competition is a major reason T-Mobile and Sprint are planning to come together.