Sprint, T-Mobile Merger Gets Boost From Google As Fourth Wireless Carrier

The modalities for creating a fourth wireless carrier in the U.S may be delaying the Sprint T-Mobile merger nod from DOJ.

But new reports say Google has jumped into the fray and is talking to Dish Networks on partnering for a fourth U.S. wireless carrier.

As is known, Dish Network is the front runner to buy some of the assets likely to be divested by the merging duo for facilitating the creation of a new wireless competitor.

They will include some spectrum, a spectrum hosting deal, and Sprint’s prepaid Boost Mobile and some offline stores.

But the talks between Dish and T-Mobile are struck in many disagreements.

FCC puts Dish on notice

Meanwhile, a Bloomberg report said, Dish is under pressure from FCC to start its mobile service on its existing $20 billion worth airwaves it owns already. The FCC wanted the service to begin by 2020 else it will withdraw the granted license.

Airwaves transfer, as required in the T-Mobile deal would need the approval of FCC.

According to reports, Alan Mulally —Alphabet director and a former Ford CEO has been engaging the satellite-TV giant Dish on behalf of Google to create a fourth telecom player.

Their talks were exploring how Google and Dish can be together to launch a new wireless giant using the assets to be divested by T-Mobile and Sprint. Divesting a portion of assets to pave way for a fourth provider was a requirement by the DOJ to grant clearance to the $26 billion merger plan.

“There’s no question they are talking,” a source said. However, Google denied any talks in that direction.

“These claims are simply false. Google is not having any conversations with Dish about creating a wireless network,” a Google spokesman said.

But talks between Google and Dish are in early stage and can fall apart. It is also unclear whether T-Mobile and Dish would announce an agreement with Google on board in case a deal is hammered out.

Some reports say T-Mobile parent Deutsche Telekom is aware of Dish’s talks with Google and wanted to prevent any tie-up.

Deutsche Telekom is also against Dish parting more than a five-percent stake to a third party.

Google’s agenda behind the wireless business

According to BTIG’s Piecyk, Google’s main interest in the Dish deal is to boost its growing cloud-computing business to make it more scalable and dent market shares of top players Amazon and Microsoft. This is because wireless devices are going to become ubiquitous.

Google’s Fi service leases wireless spectrum from T-Mobile, Sprint and US Cellular. The charges are $20 a month for unlimited calls and texting and $10 monthly for each gigabyte data consumed.

So, Google's interest is to see the last-mile provider is not very costly, added Piecyk.

Dish has $20 billion worth wireless spectrum that is lying idle. This can help Google Fi escape from its dependence on T-Mobile and Sprint.

After getting the key equipment and infrastructure from T-Mobile, both Dish and Google could launch a fully independent wireless network in a few years.

The talks between Dish boss Charlie Ergen and T-Mobile are expected to go on. But no deal is in sight for at least two to three weeks.

Even after an agreement among Dish, Google, T-Mobile and the Department of Justice, there is another big task before T-Mobile in winning over 14 states that sued the Sprint T mobile deal.

The states are concerned that shrinking wireless competition would harm consumers via higher prices.