No, a T-Mobile-Sprint merger wouldn’t be good for consumers

If the rumors are right, a merger of T-Mobile and Sprint has already been agreed in principle, and we should see an announcement by the end of October. While a merger might not instantly wreak havoc and see prices shoot up for 200%, there’s a lot of very valid reasons for anyone who pays a cellphone bill to want T-Mobile and Sprint to remain separate.

The wireless landscape resulting from a merger would be very different to what it was in 2011. The three remaining wireless companies, in the case of a merger, would have nearly equal networks and numbers of customers. There would be zero incentive for networks to compete for customers against each other, as any competition would have to come from reduced pricing, and the game theory says that networks would quickly realize that the profit-maximising solution is to offer similar plans at similarly high prices, and reap the profits.