SoftBank is scaling down its Silicon Valley operations in a move that could signal the end of the company’s quest to acquire T-Mobile, according to Reuters.
After SoftBank-owned Sprint encountered strong resistance from U.S. regulators, the carrier in August abandoned its bid to acquire T-Mobile. At the time, newly appointed Sprint CEO Marcelo Claure said Sprint’s focus would turn to aggressively competing in the U.S. wireless market, but he didn’t rule out consolidation as a long-term solution in helping the struggling carrier effectively taking on AT&T and Verizon.
The report cites unnamed sources who say SoftBank is now considering renting out one of two buildings it leased to accommodate a “T-Mobile driven expansion.” Most of SoftBank’s workforce on the west coast will be moved back to Tokyo or to Sprint’s headquarters near Kansas City.
Sprint’s acquisition bid for T-Mobile is not the only one to fall through. France-based carrier Iliad also sought a tie-up with Sprint but in October abandoned its bid saying the T-Mobile majority owner Deutsche Telekom would not entertain its revised offer.
A Bloomberg report also indicated the U.S. satellite-TV provider Dish Network was also in the early stages of a potential bid for T-Mobile.
U.S. regulators’ primary objection to allowing T-Mobile to merge with Sprint was the potential for reduced competition in the U.S. wireless market. With the four-competitor landscape still in place, U.S. Tier 1 carriers are beginning to feel the sting of increasingly cutthroat pricing promotions.
Verizon Tuesday warned that competitive pressure could inflict damage on the carrier’s wireless revenue and margins. The news caused a sell-off for Verizon and its competitors.