After the government did not allow ATT to buy T-Mobile, T-Mobile needed to find a different way to achieve scale and cut costs. Today it announced buying and merging with Metro PCS. Will the firm be able to avoid the fiasco of the Sprint/Nextel merger?
T-Mobile and MetroPCS will continue to operate as separate brands. Throughout the morning, T-Mobile executives sought to allay one of the biggest concerns about the merger, the incompatibility of the company’s network with MetroPCS’ own. John Legere, who will become the chief executive of the combined network operator, argued that the company will slowly move MetroPCS’ customers to its own GSM standard — with the goal of moving the unified entity to the Long Term Evolution technology down the road. The aim was to avoid comparisons to Sprint’s merger with Nextel, which failed at the same task and left that merged company in a far weaker position.