If US wants to be leader in 5G, it should approve Sprint, T-Mobile merger: Analyst

If President Donald Trump wants to be the leader in 5G technology, the administration should approve the merger between Sprint and T-Mobile, analyst Jonathan Chaplin told CNBC on Friday.

The two wireless companies agreed to a deal last year, but they are still awaiting federal approval of the $26.5 billion transaction.

"If it is really important to the administration to be first in 5G and have a more robust set of infrastructure in the U.S. than China, Japan and Korea do, then they should let the deal go through," Chaplin said on "The Exchange."

"That's the path to the best 5G network we're likely to see in the U.S. and it will drive AT&T and Verizon to invest."

That's because Sprint is sitting on a "phenomenal band of spectrum" that can run the technology, he said.

"What Sprint has is mid-band spectrum, which can work almost everywhere. It might not be great in the most rural parts of Montana but pretty much everywhere else it's going to work great," said Chaplin, who leads the U.S. communications services research team at New Street Research.

Verizon and AT&T, on the other hand, have high-frequency spectrums, which work great in the big cities but not very well outside of dense markets, he noted.

The problem is, Sprint doesn't have the money to deploy its spectrum band, he added.

"If the deal with T-Mobile goes through, that's going to put those companies in a phenomenal position. If the deal doesn't go through, that spectrum just sits on the sidelines for the next five years."

Trump held an event on 5G at the White House on Friday with Federal Communications Commission Chairman Ajit Pai, announcing a $20 billion fund to build out high-speed broadband networks in rural America. The FCC also intends to start the agency's third 5G spectrum auction on Dec. 10.

It's an issue the president has been pushing for. In February he called on U.S. companies to step up their efforts on the technology.

TWEET 1

TWEET 2

The White House did not immediately respond to a request for comment on Chaplin's remarks.

— Reuters contributed to this report.

Let's block ads! (Why?)

from Top News & Analysis https://cnb.cx/2KxT121