When T-Mobile Acquired MetroPCS they paid a large cash sum, in excess of $1.5M in addition to a large minority stock holding. Deutsche has said publicly that they are interested in liquidating their stake in T-Mobile for some time, and a quasi-leveraged buyout, with the public markets providing capitalization, seems possible.
My theory is that MetroPCS essentially did a leveraged buyout of T-Mobile, ASSUMING Deutsche actually exits. Their minority share could potentially become the majority share.
This further complicates things in addition to the excellent analysis to which I'm replying :).
On the subject of MVNO's, the only major Wholesale carrier left in the US is Sprint and that's also quite interesting. SoftBank, the company which applied significant downward pricing pressure on the Japanese market, just took a 70% interest in Sprint (pending regulatory approval). Assuming this transaction goes through, it could mean that SoftBank wants to lower the retail pricing, and they've publicly made comments indicating this as well.
IF that's the case, the lower retail margins will put significant pressure on Sprint's wholesale business. It's impossible to have Retail and Wholesale priced near each other, so the likely conclusion (and what we've seen time and again in the MVNO space) is that the carriers will exercise their capricious will and jack up the rates significantly at the first contract expiration. What happens to all the subscribers that the MVNO had? Converted to the carrier; time and again this has happened.
So no, I don't think Google will be an MVNO, it's suicidal on some level to base your primary business on someone else's private enterprise IMHO.
When T-Mobile Acquired MetroPCS they paid a large cash sum, in excess of $1.5M in addition to a large minority stock holding. Deutsche has said publicly that they are interested in liquidating their stake in T-Mobile for some time, and a quasi-leveraged buyout, with the public markets providing capitalization, seems possible.
My theory is that MetroPCS essentially did a leveraged buyout of T-Mobile, ASSUMING Deutsche actually exits. Their minority share could potentially become the majority share.
This further complicates things in addition to the excellent analysis to which I'm replying :).
On the subject of MVNO's, the only major Wholesale carrier left in the US is Sprint and that's also quite interesting. SoftBank, the company which applied significant downward pricing pressure on the Japanese market, just took a 70% interest in Sprint (pending regulatory approval). Assuming this transaction goes through, it could mean that SoftBank wants to lower the retail pricing, and they've publicly made comments indicating this as well.
IF that's the case, the lower retail margins will put significant pressure on Sprint's wholesale business. It's impossible to have Retail and Wholesale priced near each other, so the likely conclusion (and what we've seen time and again in the MVNO space) is that the carriers will exercise their capricious will and jack up the rates significantly at the first contract expiration. What happens to all the subscribers that the MVNO had? Converted to the carrier; time and again this has happened.
So no, I don't think Google will be an MVNO, it's suicidal on some level to base your primary business on someone else's private enterprise IMHO.