Pretty in Pink: T-Mobile Chief Is the Colorful Outlier of Wireless


It’s a bold move, and one that illustrates Mr. Legere’s willingness to disrupt the status quo, even if he appears to have the weaker hand.

“He wants to take on the titans of AT&T and Verizon,” said Steve Grasso, director of institutional sales at Stuart Frankel and a market analyst for CNBC, who knows Mr. Legere socially. “He’s a pit bull.”

The combination of T-Mobile and Sprint has been years in the making, as both companies have sought to add scale and compete with their larger rivals. Yet the last time the companies formally attempted a deal, in 2014, it was Sprint that was planning to acquire T-Mobile.

That deal fell apart in the face of regulatory scrutiny. And since then, Mr. Legere has managed to build T-Mobile’s business by flouting convention. Under his leadership, T-Mobile began offering unlimited data, reduced prices and less stringent contract commitments.

When Mr. Legere took over in 2012, he was a very different executive, and T-Mobile was a very different company.

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Mr. Legere, left, has for years favored T-Mobile’s pink in his wardrobe. The Sprint chief executive Marcelo Claure added Sprint’s yellow to his outfit after their two companies announced an agreement to combine.

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Brendan Mcdermid/Reuters

T-Mobile was reeling from a failed attempt to sell itself to AT&T and struggling to distinguish itself from other low cost carriers like Sprint and Metro PCS. Mr. Legere, who spent 20 years working at AT&T, was a conventional, if ambitious, telecommunications executive.

“He was a finance guy,” said Dan Hesse, the former chief executive of Sprint, who was a mentor of Mr. Legere’s at AT&T. “The first time I saw John after he was named C.E.O. of T-Mobile, he was there in his suit.”

That soon changed. In 2013, Mr. Legere was onstage at an event in Las Vegas with Joe Torre, the former manager of the Yankees, promoting a partnership between T-Mobile and Major League Baseball.

When reporters asked him about the state of the wireless industry, he responded with a tirade about how badly customers were mistreated, and what he planned to do differently.

“It hit a chord,’’ he told Business Insider. “It was an action statement for me — I’m sure it sounded a bit arrogant — that I was going to fix this industry. From then on, I started to be the brand.”

Soon, Mr. Legere, now 59, had a whole new look. He grew his hair to his shoulders. He wore company T-shirts wherever he went. He pulled on custom pink Converse sneakers emblazoned with the T-Mobile logo. Before long, the finance guy looked more like an aging rock star.

At the same time, Mr. Legere embraced social media as a tool to promote himself and needle his adversaries. On Facebook, he started a cooking show, “Slow Cooker Sunday.” On YouTube, he called AT&T and Verizon “dumb and dumber.”

And on Twitter, he began hurling insults at competitors and tangling with rival C.E.O.s — including Sprint’s Marcelo Claure.

Twitter users ate it up, and Mr. Legere now has more than 5.6 million followers. Twitter even designed him a custom emoji.

Offline, Mr. Legere also cultivated an eccentric image. He is a regular visitor to T-Mobile stores and call centers, where he delivers boisterous pep talks. At company meetings, he offers employees $100 if they will ask him a question in the form of a song. And in the office, he is fond of riding around on a Segway.

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Mr. Legere taking a selfie before a T-Mobile event in Los Angeles in 2015. He has cultivated an eccentric image with boisterous pep talks to employees and the look of an aging rock star.

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Patrick T. Fallon/Bloomberg

“John has built a franchise around T-Mobile, which is in part his own,” said Stephen Scherr, head of the consumer and commercial banking division at Goldman Sachs, who has worked with Mr. Legere for more than a decade.

But Mr. Legere has paired showmanship with results. During his tenure, T-Mobile has added subscribers and increased revenues and profits. “He’s also a great operator,” Mr. Scherr said. “He runs a really good business.”

If Mr. Legere succeeds in finally joining T-Mobile and Sprint, the man who wanted to come off as the consummate outsider will have pulled off the ultimate insider move: a mega-merger to combine two rival companies and seize a greater share of a changing industry.

Regulators are certain to take a close look at the proposed combination, and there is a chance they could block the deal. However, there is reason to believe that they could view the union more favorably than they did four years ago.

Under President Trump, antitrust enforcement has become unpredictable. The Justice Department has mounted a court fight against the proposed combination of AT&T and Time Warner, which do not directly compete with one another. At the same time, there appears to be little resistance to the proposed acquisition of 21st Century Fox assets by Disney, a deal which would reduce competition in the film and television industry.

Mr. Legere, who is sensitive to public perceptions, seems to have anticipated this moment. In January 2017, after Mr. Trump’s election but before his inauguration, Mr. Legere was asked about his view of the regulatory environment under the Trump administration.

“It’s hard not to be excited,’’ he said, about regulatory views that would be “conducive to us significantly expanding our business.”

Mr. Legere added that he was hoping to meet Mr. Trump, and offered roundabout praise for the president’s famously antagonistic approach to social media, saying that Mr. Trump had replaced him as one of the “kings of mean on Twitter.”

Mr. Legere knew from had firsthand experience. In 2015, after Mr. Trump insulted the U.F.C. fighter Ronda Rousey on Twitter, Mr. Legere came to her defense. In the ensuing exchange, Mr. Legere said Mr. Trump wasn’t presidential material.

“I am an undecided Republican,” Mr. Legere wrote. “Well not totally undecided, I know what I don’t want :)”

But it seems that the prospect of a multibillion deal can heal old wounds.

Mr. Legere has since deleted that tweet about the president. And on Sunday, Mr. Legere was making the rounds with Mr. Claure of Sprint, another old social media sparring partner, to talk up their alliance.

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How Would a T-Mobile-Sprint Merger Affect Your Cellphone Bill?


When T-Mobile and Sprint aggressively competed for budget-conscious customers and began gaining subscribers with lower prices, AT&T and Verizon ended up following suit.

What other changes might I see as a wireless subscriber?

Beyond lower prices, T-Mobile has been a driving force behind giving consumers more flexibility. Since 2014, T-Mobile has let consumers forgo long-term contracts and allowed users to bring the devices of their choice to its network. It eliminated roaming charges in Canada and Mexico and promised no surprise fees or taxes in its monthly bills.

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T-Mobile’s chief executive, John Legere, second from right, would be in charge of the new company. T-Mobile markets itself as an industry rebel, but Sprint has a more reserved reputation.

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Charles Sykes/Associated Press

Those policies were praised by government officials as proof positive that a four-way competition among the big carriers had been the right decision. They called T-Mobile a “maverick” in the wireless industry. (T-Mobile and Sprint say they would continue to offer similar policies.)

But the question is whether T-Mobile would still have the incentive to be as scrappy after the merger — when it would look a lot like the big telecom providers it was forced to contend with as an aggressive upstart.

“The biggest problem with this merger is that these two companies are each other’s biggest competitors for serving middle-income, budget-constrained wireless customers,” said Gene Kimmelman, a former senior antitrust official at the Justice Department who was at the department when it sued to block AT&T’s proposed merger with T-Mobile in 2011.

Will the company be more like T-Mobile or Sprint after the merger?

The combined company would be called T-Mobile, and have T-Mobile’s attention-grabbing chief executive, John Legere, in charge. The main headquarters would be at T-Mobile’s offices in Bellevue, Wa., with a second headquarters at Sprint’s offices in Overland Park, Kan.

But the new company would be a combination of different cultures. T-Mobile has ranked at the top of recent customer satisfaction surveys, and Sprint has often lagged behind its rivals in customers’ minds. T-Mobile has invested heavily in marketing itself as an industry rebel, with Mr. Legere out in front, insulting Verizon and AT&T on Twitter. Sprint, on the other hand, is much more reserved and its customers aren’t likely to follow its executives on social media.

How will the merger affect my service? Will I experience technical problems when the networks are combined?

Customers of the combined company would have greater coverage across the country, especially those in rural areas whose current provider would get a boost from the other company’s towers.

And even if regulators scuttle the merger, the companies said they had struck a roaming agreement that will allow customers of either company to use the other company’s network.

The roaming agreement also helps the companies prepare to merge their infrastructure in the event the deal goes through, although it’s hard to say that customers wouldn’t experience some glitches in service. The companies haven’t revealed any details on what kinds of service plans would be offered and what devices would be permitted. And billing and customer service would also have be consolidated, which could be a tricky transition.

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Sprint and T-Mobile Agree to Merge, in Bid to Remake Wireless Market


The parent companies of each carrier — SoftBank of Japan, which controls Sprint, and Deutsche Telekom of Germany, which owns a majority of T-Mobile — managed to solve the longstanding issue of control in recent weeks.

Under the terms of the all-stock deal announced on Sunday, Sprint will be valued at about $26.5 billion and T-Mobile at about $54.1 billion. Deutsche Telekom would own roughly 42 percent of the combined business and have nine of 14 seats on the new T-Mobile’s board. SoftBank would own 27 percent and have four seats, one of which would be held by its founder, Masayoshi Son. Public shareholders would own the remainder.

John Legere, T-Mobile’s chief executive and an architect of a low-cost strategy that ignited a price war among American wireless service providers, will run the merged company. The business will have headquarters in both Bellevue, Wash., where T-Mobile is based, and Overland Park, Kan., Sprint’s home.

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Inside the Sprint store at Flatiron Building in Manhattan. The merger announcement on Sunday takes a step toward fulfilling a long-frustrated dream of Sprint’s owner, the Japanese billionaire Masayoshi Son.

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Jeenah Moon for The New York Times

“This combination will create a fierce competitor with the network scale to deliver more for consumers and businesses in the form of lower prices, more innovation, and a second-to-none network experience — and do it all so much faster than either company could on its own,” Mr. Legere said in a joint news release.

Sprint and T-Mobile argue that combining will help them afford the billions needed to expand their so-called 5G network, a fifth-generation wireless technology that promises to bring ultrafast broadband speeds to mobile service. It is the standard that will be used to connect home appliances, cars and smartphones online via fiber optic lines to the home.

Sprint and T-Mobile are harder pressed than the competition to build the network. Sprint has about $32 billion in debt on its books, while T-Mobile generates a fraction of the cash that Verizon and AT&T do.

“Going from 4G to 5G is like going from black and white to color TV,” Marcelo Claure, Sprint’s chief executive, said in the news release. “It’s a seismic shift — one that only the combined company can unlock nationwide to fuel the next wave of mobile innovation.”

At the same time, the four big wireless providers are increasingly competing against newer contenders looking to chip away at their market, including the cable providers Comcast and Charter Communications.

The announcement on Sunday takes a step toward fulfilling a long-frustrated dream of Mr. Son of SoftBank. When his company took control of Sprint in 2013, he boasted of defeating Verizon and AT&T in their own backyard. But to do so, he needed a bigger platform than Sprint alone, and he quickly began talks to buy T-Mobile, which, at $55 billion, has more than twice the market value as Sprint.

The stakes are big for both sides, but especially for Mr. Son. Sprint has lost billions of dollars and millions of subscribers, while taking on debt, since SoftBank took it over. By contrast, T-Mobile, buoyed by a hugely popular unlimited data plan and an aggressive marketing campaign, leapt over its beleaguered rival to take third place in the American wireless rankings.

Yet it is T-Mobile’s success that could provide the basis for a regulatory challenge of the deal. At least under the Obama administration, the Federal Communications Commission and the Justice Department — which would both weigh in on this merger — have argued that shrinking the number of national wireless players could lead to less competition and higher prices.

Mr. Son, in particular, has bet that his courting of President Trump with promises of significant investment in the United States would help this transaction win regulators’ approval.

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