Japanese telecoms giant SoftBank, the parent of wireless carrier Sprint Corp, is shrinking its US operations after last year’s failed bid for smaller rival T-Mobile US. The group, controlled by CEO Masayoshi Son, has sublet two office buildings in…
Japanese telecoms giant SoftBank, the parent of wireless carrier Sprint Corp, is shrinking its US operations after last year’s failed bid for smaller rival T-Mobile US.
The group, controlled by CEO Masayoshi Son, has sublet two office buildings in San Carlos, California, which had held around 100 Softbank employees, a SoftBank spokesperson said, fuelling speculation that the company might review its strategic options in the country.
The spokesperson said that SoftBank, which holds an 80% stake in Sprint, decided to sublet the buildings as a number of collaborative projects with Sprint had ended.
In recent years, Sprint, the third-largest US operator, has been struggling to compete against incumbent players Verizon and AT&T, while carrier number four T-Mobile US has been gaining ground, adding 8.3 million total customers in 2014.
According to analysts, Deutsche Telekom-owned T-Mobile will surpass Sprint in terms of total subscribers in time for their upcoming quarterly results.
IDC senior research analyst Brian Haven told TelecomFinance: “Sprint needs a shot in the arm to help it recover from the…losses it saw over the course of the last year.”
Since acquiring Sprint in 2013, SoftBank strived to improve the carrier’s profits. Shortly after abandoning its plans to merge with T-Mobile due to opposition from US regulators, the Tokyo-based telco appointed Marcelo Claure, founder of handset distributor Brightstar, to the top role last August in order to drive growth and improve cost efficiency.
In November, Claure said during an earnings conference that the operator was conducting a “pretty deep review” of its wireline assets, reportedly valued at around US$4bn.
It is also mulling a partial sale of its 2.5 GHz spectrum portfolio, with Verizon tipped as one of the most likely buyers.
“If the FCC is worried about efficient use of spectrum and T-Mobile’s ability to deliver the fastest speeds in the market it might want to also consider how long Sprint should be allowed to sit on effectively all the 2.5/2.6 GHz spectrum in the United States while under-investing in its network and searching for a customer acquisition strategy that works,” Walter Piecyk at BTIG Research wrote in a recent note.
