Profitable, but still only $40B in revenue compared to $126B for Version, and only $4B net profit compared to $30B for Verizon. Verizon's net profit is closer t

Profitable, but still only $40B in revenue compared to $126B for Version, and only $4B net profit compared to $30B for Verizon. Verizon's net profit is closer to T-Mobile's total revenue. https://s22.q4cdn.com/194431217/files/doc_financials/2017/annual/1500109984.pdf https://s22.q4cdn.com/194431217/files/doc_financials/2017/an... https://www.verizon.com/about/sites/default/files/2017VerizonAnnualReport.pdf https://www.verizon.com/about/sites/default/files/2017Verizo... That is not a sustainable competitive position in a capital intense industry. Spectrum is part of the deal but hardly the only one. Retail consolidation would be a big cost savings. Refinancing Sprint's debt ($40B) with T-Mobile's better credit ratings would save hundreds of millions per year in interest expenses. CAQ for mobile customers is very high, so Sprint's customer base is worth quite a bit. The really important question is how the deal will affect the competitive landscape for 5G. Neither Sprint or T-Mobile have the scale to effectively compete on 5G and Sprint in particular is in bad shape due to their low credit ratings and high borrowing costs. If T-Mobile doesn't merge with Sprint, either a larger company does, or Sprint continues to circle the drain with low-value services and slowly dies. If Sprint loses customers then all else being equal this benefits AT&T/Verizon more because, if those customer migrate in proportion to existing market share, they get more of them. So Sprint going down weakens T-Mobile's competitive position. Whether or not merging with Sprint actually improves T-Mobile's competitive position depends on execution but there is at least a plausible story there. At this stage of the industry the opportunities for competition at the infrastructure level are limited and regulators should be focused more on maintaining a competitive market for MVNOs that are offering differentiated products like Google Fi and cheap pre-paid options like Mint.