Charter Says it Doesn’t Want to Buy Sprint (Jul 31, 2017)
There were lots of reports over the weekend that Sprint and Charter were approaching a tie-up, just after the end of the exclusive negotiating period between the two and Comcast which began just over a month ago. However, Charter has now come out and said that it’s not interested in buying Sprint, which isn’t necessarily the deal being discussed, but is as close as Charter can get to saying it’s not interested in any deal, given that it has a fiduciary responsibility to keep the door to potential acquisition offers open. It’s been fascinating to watch this latest round of SoftBank-driven Sprint merger mania, because whereas last time Sprint was to merge with another player (T-Mobile), it was the US government that shot it down. This time around, the biggest barrier is a lack of willing partners. T-Mobile is certainly far less in need of the merger now than it arguably was several years ago, while the cable companies may well want to merge with a wireless industry, just not the weakest of the big four US providers. Sprint has the poorest network, the poorest financial performance, the lowest overall subscriber growth, and the least subscribers of any of the big four operators, making it the least attractive merger partner of the four, with T-Mobile much more enticing at this point. It’s still possible that SoftBank will try to buy Charter, and if the price is high enough that Charter’s management will feel they have to accept the offer, but it’s clear at this point that this will happen against their stated wishes, which will make any merger process that much more challenging than it would already have been.
I don’t usually cover the Indian market in depth here, but Jio feels like one of those stories that more people outside of India need to know about. It’s part of one of the big Indian conglomerates, Reliance Industries, and launched public LTE-only mobile services in September last year, signing up 125 million customers since then, an unprecedented rate of growth for any mobile operator anywhere. Until now, that service was available only on smartphones, either compatible devices customers brought with them or those sold by Jio. But today, Jio announced its own VoLTE-capable feature phone, which it will offer for free (albeit with a 1500 rupee – $23 – refundable security deposit) starting next month, with an unlimited voice, text and data plan for 153 rupees ($2) per month. What Jio has done in India over the past year or so is one of those things that just doesn’t seem like it should be possible – massive customer growth from zero, while offering fairly leading edge technology in devices and its network. The big enabler is that Jio is part of that massive conglomerate, which makes lots of money from the petroleum industry and therefore doesn’t need Jio to be profitable, at least not yet. In addition, although Jio touts its broad coverage (and promises to cover 99% of the population shortly), my understanding is that the coverage can be unreliable and some users are deploying it as a second-SIM solution rather than their only option. A lack of network density is likely the big problem, offering nominal coverage across a wide area but offering spotty coverage within that area in practice. But it’s been disruptive nonetheless, providing access to 4G and smartphones for those who previously hadn’t taken the plunge, and the new feature phone is going to extend 4G and some basic data services to a far larger number.
Sprint’s Virgin Mobile Goes iPhone-Only in Relaunch (Jun 22, 2017)
I’ll start with my usual caveat on so-called “gigabit” wireless services: though theoretical throughputs on devices with the new modems being discussed here can reach gigabit per second speeds, the real-world experience is going to be a fraction of that. In other words, even if the reporting in this article is correct, Apple isn’t going to be missing out on true gigabit speeds any more than the other device vendors will have them. The second caveat is that even the more realistic speeds will only be available where carriers have upgraded their networks to support them, which will be far from everywhere for the near future. With those caveats out of the way, though, Apple will be one of the few device vendors out there without these faster modems in its devices over the next year. However, as the article rightly points out, Apple has rarely been willing to put cutting edge new modem technology in its devices at the same time as others, generally preferring to wait for the technology to mature before deploying it, as it notably did with both 3G and LTE. There is, of course, this time also the added complication of Qualcomm being the only supplier with a gigabit modem ready to go, and the fact of Apple’s very adversarial relationship with Qualcomm and its decision last year to introduce Intel modems. I’m inclined to believe the reporting here is accurate, but I’m not sure it’s really all that significant – in real-world experience, there will be very little difference for many customers over the next couple of years, and Apple will almost certainly jump on the gigabit modem bandwagon next year, likely through Intel.