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Let The Race To 5G Begin!

Dear Rundown Reader,

5G wireless.

The anticipated release of this lightening fast network is capturing the hearts and minds of Wall Street, techies, and everyone in between.

Why?

If you ask our chief technology expert Ray Blanco, it’s because “if ‘we’ do 5G right we’ll never need a 6G. The network’s THAT fast.”

Which means gamechangers all round us. On Wall Street and in our everyday lives.

5G could be in select cities as soon as this year.

The race to 5G is on and first movers will mint fortunes.

Your Rundown for Tuesday, May 1, 2018…

T-Mobile and Sprint Vying To Be No. 1 In Wireless

Antitrust lawyers are working furiously at the DOJ to stop T-Mobile’s (NASDAQ: TMUS) purchase of Sprint (NYSE: S).

The deal, announced last week, would combine the No. 3 and No. 4 wireless carriers in the U.S.

If the deal goes through it could launch the companies to the No. 1 spot.

But the merger has drawn criticism from the antitrust folks and now is under scrutiny from the U.S. Justice Department.

Will this deal go through?

Wall Street generally doesn’t think so.

The two companies have tried to do this deal twice before. Both times it was blocked by the DOJ.

Bloomberg reports, most experts give the chance of the new deal going through a 50 / 50 shot at best.

Former DOJ employees are also sour on the idea.

Speaking to Bloomberg, former deputy assistant attorney general David Turetsky notes: “I find it hard, given the history, to see the DOJ not challenge it. It’s basically a four to three in the wireless industry. Even if they argue there are 10 players, they are still the top four.”

Stocks for both T-Mobile and Sprint are on the downswing off the sentiment.

Here’s the chart for both over the past 10 days.

Antitrust

Sprint shares fell over 15%. T-Mobile shares dropped over 7%.

There’s a lot at stake with this deal. And it all revolves around who can be the first to implement 5G successfully.

AT&T and Verizon plan to roll out next-generation 5G networks to customers over the next couple years.

T-Mobile and Sprint are currently quite far behind in their 5G efforts. A merger could help them significantly bridge this gap.

From a technical standpoint the deal makes sense according PC Magazine. Sprint and T-Mobile’s proprietary technologies work well together and could offer great new 5G networks.

But the DOJ doesn’t just look at technical aspects. And the likelihood they block the merger is still high.

But there’s also a sliver of hope.

According to CNBC’s Squawk Box Monday morning, the DOJ is “very stretched.”

What this means is open to interpretation.

But one possibility is maybe this deal actually gets done because the DOJ doesn’t have the time or resources.

A thought worth considering at least.

We could have a juicy looking long shot in the making.

Now, turning to the markets this morning…

Market Rundown for Tues., May 1

S&P 500 futures are up 1.00 at 2,648.

Oil’s down slightly to $67.77.

Gold’s down $9.90 at $1,309.

Bitcoin goes for $8,996 this morning, according to CoinDesk.

We’ll talk again on Wednesday.

For the Rundown,

Aaron Gentzler

Aaron Gentzler

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Aaron Gentzler is the publisher of Seven Figure Publishing. He is also the editor of The Rundown. Aaron’s been with Agora Financial/Seven Figure Publishing for 13 years. He's been covering technology and markets for over a decade.

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