The news this morning has Sprint Nextel (NYSE:S, news, filings) in talks with Deutsche Telecom AG (ETR:DTE, news, filings) over a potential merger with T-Mobile USA. And in other news, the sun rose this morning and is rumored to be likely to set this evening. You’d think if a deal were to be had, they’d have made a bit more progress on it by now. On the plus side, such a deal would make a bigger wireless carrier that is more able to compete with AT&T and Verizon in scale. On the minus side, the two networks are incompatible as it stands, and to say that Sprint has been burned recently by integration troubles is a bit of an understatement.
Where this takes a twist of course is when it comes to WiMAX and Clearwire and LTE and LightSquared. A deal with between Sprint and T-Mobile USA to head in the direction of HSPA+ for now would certainly change the landscape, pulling Sprint away from Clearwire and T-Mobile USA away from what seems like an eventual partnership of some sort with LightSquared. The rumored talks have Deutsche Telecom swapping TMobile USA for a substantial chunk of the combined entity, which would give it a substantial chunk of a substantial chunk of Clearwire.
More likely than an actual deal, of course, is that these talks will end without a deal, and will be restarted again in, say, May. Or maybe June. Or maybe both.
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