Regulators do not like the prospect of Sprint buying T-Mobile.
The latest to express his skepticism is Federal Communications Commission Chairman Tom Wheeler, who told Sprint Chairman Masayoshi Son and CEO Dan Hesse that while he would keep an open mind about such a deal, he was highly skeptical, according to Reuters.
Sprint will have a long road ahead of it in convincing the government that the wireless industry would benefit from a merger between the third- and fourth-largest wireless carrier. Sprint, which presumably would buy T-Mobile, has argued that a combination between the two would make for a stronger competitor against AT&T and Verizon Wireless.
But T-Mobile's recent success has shown regulators that being smaller isn't necessarily such a significant disadvantage. While Sprint has languished from its slow network roll out and the slow shutdown of its Nextel network, T-Mobile has shown a remarkable turnaround over the past year. Regulators aren't keen to remove such a competitive threat to the industry.
T-Mobile executives, for their part, expressed a willingness to strike a deal, but noted that they would want to continue their Uncarrier campaign and suggested they might be better suited to lead a combined carrier.
A Sprint representative declined to comment.
While regulators have given a potential deal long odds of passing, Sprint has been arguing that such a transaction shouldn't be dismissed without a fair review.
Ever since regulators rejected AT&T's bid to acquire T-Mobile, they have been set on having four national carriers in the industry.