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Sprint and T-Mobile about to close their merger deal

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June 10, 2014

Sprint and T-Mobile, through their proposed merger, gain a chance to 'clean up house' associated with Sprint’s past mistakes while conveying the message that the new company will be focused on growth.

Overall, corporate deals are one of the top reasons companies change their monikers, said Tim Calkins, a marketing and branding professor at Northwestern University’s Kellogg School of Management.

For example, SBC Communications took AT&T’s more widely recognizable name after acquiring the company in 2005.

And in 2000, Bell Atlantic Corp. and Vodafone AirTouch Plc abandoned stodgier corporate brands to christen their wireless venture Verizon Wireless-- a name that never existed before.

T-Mobile is the world’s 27th-most-valuable brand, while Sprint doesn’t even make the top 100, according to Millward Brown Optimor, a brand consulting firm.

As Sprint has lost millions of customers in 2013 alone, T-Mobile added more subscribers last quarter than larger rivals AT&T and Verizon Communications combined.

“The most important element is to find a name that best competes with AT&T and Verizon,” said Laura Ries, a brand consultant who cofounded marketing strategy firm Ries & Ries in Atlanta.

“If I had to choose, I’d go with T-Mobile as the name because it is fresher and it has mobile in the name. And let's face it-- T-Mobile USA is a popular company in America.”

Bill White, a Sprint spokesman, and Anne Marshall, a T-Mobile spokeswoman, both declined to comment on this story.

“Branding will be a huge question if these two firms come together,” Calkins said. “They need to understand what Sprint means to people and what T-Mobile means.”

There isn’t a hard and fast rule on how to do this the right way, said Oscar Yuan, a brand strategist with Millward Brown Optimor.

In other mobile news

A wireless services provider in London is offering a landline-free subscription to citizens living in the heart of the city.

U.K. Broadband, which is owned by Hong Kong's PCCW Group is offering what it described as "fibre-fast speeds without any hassle".

The new company, Relish, is able to use British Telecom's copper wiring - which the one-time state monopoly wholesales to other broadband providers such as BSkyB and TalkTalk - because its networks run over LTE 4G and Wi-Fi.

Relish is selling the new service to central London-based consumers and businesses in a move to apparently disrupt the market.

Consumers who are in Relish's relatively limited range can expect to pay £20 per month for the service.

If they lock themselves into a 12-month contract, then customers get the hardware for free, otherwise there's an added £50 installation fee.

But some might feel a bit cheated out, however. Relish has not gifted that part of London with access to its no hassle network.

In other wireless news

The news is out today that Barnes & Noble and Samsung are working together on a new tablet design. The two firms will launch co-branded tablets. The new devices will be known as the Samsung Galaxy Tab 4 Nook, and will feature Samsung's hardware and customized B&N Nook software.

The first Galaxy Tab 4 Nook will hit store shelves in the United States in August with a 7-inch display.

The decision to partner with Samsung might be a good one for Barnes & Noble. The company's Nook business has been failing miserably lately, with its last-reported quarter ended January 25 showing a 50.4 percent decline in sales.

B&N shareholders have been calling on the company to make drastic changes or shutter the operation altogether. For its part, Samsung is performing somewhat better in the tablet segment and is one of the leaders in Android-based tablets.

The partnership effectively ends Barnes & Noble's foray into hardware design. The company said on Thursday that while it'll still offer its Nook GlowLight -- a backlit e-ink e-reader -- it will now only support the Nook slates it's launched to this point.

Leaving the hardware design to Samsung allows Barnes & Noble to better focus on its own software and Nook content sales.

To be sure, content sales have also proven difficult to generate lately. During the last-reported quarter, which includes digital apps and e-books, among other services, saw sales drop 26.5 percent year-over-year to just $57 million.

What's not immediately clear at this point is just what Samsung will get out of the deal. The company is performing well on its own and doesn't necessarily need a Nook partnership with Barnes & Noble to dramatically improve its business.

In a statement yesterday, Samsung kept its plans close to its vest, providing no insight into why it might have taken the deal.

Barnes & Noble also announced on Thursday that it's relocating its campus. The company is moving from its 208,000-square-foot Palo Alto campus to two new facilities in Santa Clara and Mountain View that together take up 88,000 square feet.

The move is part of a much broader attempt on Barnes & Noble's part to reduce expenses. Indeed, the move itself will save the company about $102 million over the length of the lease.

In other mobile news

Huawei claims that it has achieved a performance of 10.53 Gbps Wi-Fi throughput in the 5 GHz band in its most recent lab testing. The lab trials took place on the company's Shenzhen research campus in China. The 802.11ax standard is at the beginning of a push towards the market.

The IEEE board approved the standard effort in March after a year of meetings and initial trials.

Overall, Huawei says that the key technologies that offer it a ten-fold speed boost over 802.11ac's current gigabit capability are “MIMO-OFDA, intelligent spectrum allocation, interference coordination, and hybrid access”.

To be clear, MIMO-OFDA describes a mix of two technologies instead of just one. MIMO – multiple in, multiple out – uses many antennas at both the transmitting and receiving stations for spatial multiplexing.

By taking different spatial paths, the same frequencies can carry different information. OFDA – more properly OFDMA, orthogonal frequency division multiple access – takes existing ODFM schemes, and divides sub-carriers to different data streams.

Intelligent wireless spectrum allocation and interference coordination is self-explanatory, but we have no clear idea about what's meant by “hybrid access” in this context.

The Huawei release doesn't mention how many channels were needed to get 10 Gbps throughput, nor how wide the channels were.

The company is chairing the 802.11ax task group, and says it hopes the standard will be ratified in 2018.

In other mobile news

AT&T said earlier today that it will start selling the Asus Padfone X, a tablet and phone hybrid, to its mobile subscribers on June 6 for about $200.

But you need to take note that this $200 sticker price requires you to commit to a minimum two-year service contract.

But customers do have the option to buy the Padfone X for no money down as part of AT&T's Next contract-free upgrade plan, if they elect to do so.

You also need to keep in mind that you'll still be on the hook for either eighteen monthly payments of $22.92 each or twelve monthly payments of $29.80.

To be exact, they add up to sums of $412.56 and $357.60 respectively. Don't forget to tack on additional monthly data and voice charges either.

One big advantage that the Asus Padfone brings to the table is its ability to function as both a wireless smartphone and Android tablet.

That means owners of the device will have the flexibility to switch between a standard mobile handset and slate on the fly, yet pay for only one cellular plan. Stay tuned for a full review as soon as we get our hands on a test unit. We will update you at that time.

In other mobile news

It appears that Apple is planning to launch a new 'smart home platform' at June's Worldwide Developer Conference.

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It's expected that the new platform will allow Apple iPhones and iPads to control a home's lights, security system and a few other connected appliances.

The new software platform, which will be unveiled at WWDC on June 2nd, will be built into the iOS devices, according to the Financial Times report, which cited anonymous sources.

As with Apple's "Made for iPhone" program, the new platform will be open to third-party device makers, allowing their electronic gadgets to work on Apple's new automation system.

One application of the new software platform cited by the newspaper was the ability to automatically turn on the lights when an iPhone paired with the new system enters a building or home dwelling.

Apple outlined its ideas for a home automation system in a patent filing last November. The move is seen as a big play to challenge device giant Samsung and Google, which in February closed its $3.2 billion acquisition of Nest Labs, a maker of the Learning Thermostat and the Protect smoke and carbon monoxide detector.

As companies increasingly look for opportunities to expand smartphones' reach, home automation is seen as one of new markets for sustained growth.

To be sure, Apple already has made inroads with the automobile sector. At WWDC 2013, the company announced a few plans to better integrate iOS into car dashboard screens.

Dubbed 'Apple's iBeacon location-sensing technology' which debuted late last year on devices running iOS 7, is already in use for indoor navigation, automatic ticketing, and location-relevant promotions.

We contacted Apple this morning for comment on the report and will update you when we learn more.

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Source: The Kellogg School of Management.

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