The proposed merger between Sprint and Nextel will mark the last mega-merger consolidation in the US mobile market, industry analyst have predicted.
The announcement ends long-running speculation around the merger itself and, according to analyst Ovum, creates a third "super-operator" in the US market as Sprint/Nextel joins Cingular Wireless and Verizon Wireless at around the 40-million subscriber mark.
According to Jan Dawson, research director at Ovum, the Sprint/Nextel tie up was "always a more palatable solution" than Verizon Wireless' rumoured acquisition of Sprint, which he said would have been difficult in regulatory terms as well as providing little additional value for Vodafone, which would have had to agree to the deal.
"This is good news for US consumers and for Vodafone's shareholders," said Dawson.
"Assuming that this merger is approved by the authorities, and this seems likely, it is hard to imagine regulators approving any further major consolidation in a market with three such dominant players."
He added that T-Mobile is now "set adrift" as a distant fourth in the US mobile market, which calls into question its ability to survive as a significant force.
However, Dawson went on to speculate that Vodafone, having seen two opportunities for establishing a stronger foothold in the US market slip away, might seek to acquire T-Mobile from Deutsche Telekom.
"But it is not at all clear that Deutsche Telekom would want to sell now that T-Mobile USA is providing valuable revenue growth for the group," he said.
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