Tuesday, 21 February 2017

Liberty Global's John Malone floats possibility of T-Mobile US takeover

By Nick Wood, Total Telecom
Wednesday 11 January 17

Cable group's chairman says Trump presidency could spark new wave of consolidation.

Liberty Global chairman John Malone late on Tuesday posited the idea of U.S. cablecos joining together to acquire T-Mobile US in a bid to head off competition from AT&T. Bloomberg reports that his comments were made during an investor event hosted by Lions Gate Entertainment &ndash…

Liberty Global chairman John Malone late on Tuesday posited the idea of U.S. cablecos joining together to acquire T-Mobile US in a bid to head off competition from AT&T.

Bloomberg reports that his comments were made during an investor event hosted by Lions Gate Entertainment – a production company in which Malone is a major shareholder.

Malone suggested that a Trump presidency would ease regulatory restrictions on major mergers and acquisitions, paving the way for consolidation between two or more of the country's top three cable providers, Comcast, Charter and Cox Communications.

Cablecos face increasing competition from telcos, particularly DirecTV parent AT&T, which last year agreed to acquire media giant Time Warner for $85.4 billion.

"Maybe the three major cable companies get together and buy T-Mobile," Malone said, according to the report. "One could contemplate in a Trump administration Comcast and Charter could merge."

Alternatively, cablecos could take the MVNO route to the mobile market, thereby avoiding contentious and costly acquisitions.

Indeed, Comcast in September confirmed plans to launch a mobile service this year that is similar to Google's Project Fi, insofar that it will rely predominantly on WiFi for connectivity, and will use spectrum leased from Verizon Wireless as back up.

Meanwhile, in a blog post last week, T-Mobile US CEO John Legere gave short shrift to the idea of cablecos launching MVNO services.

"Big cable will unleash their assault on wireless through their MVNO deals, and big surprise – customers won't be satisfied," he predicted.

"The last two letters in MVNO are 'NO' – as in customers will say 'NO, an MVNO strategy is just not good enough, big cable'," he continued. "And for that reason, T-Mobile will say 'NO' to MVNO deals with cable companies."

Please enable JavaScript to view the comments powered by Disqus.

Newsletter signup

Quickly get on board and up to date with the telecoms industry