Business Strategies

1) The article I chose is about the future merger between T-Mobile and MetroPCS. Back in October 2012, T-Mobile and MetroPCS have agreed to merge, the company remaining under the name T-Mobile. In the past years, T-Mobile had been heavily threatened by the competition, being the smallest competitor in an oligopoly of four: AT&T, Verizon, Sprint, and T-Mobile, the oligopoly controlling 89% of the cellular market. The market can also be considered as a "duopoly," with Verizon and AT&T controlling more than two thirds of the market (68.60% of the market in 2011, according to IBISWorld.) After a failed merger with AT&T, T-Mobile decided to use the money from the failed merger to buy MetroPCS. The deal is likely to be approved by the Department of Justice and the FCC because the deal would make T-Mobile a stronger competitor in the market. More than being a stronger competitor, T-Mobile would catch up on its competitor in the field of technology, deploying a prime 4G LTE network, using its own network and the one from MetroPCS.

2) This article is related to the chapter because it deals with external factors such as the legal, political, economic and technological environment, four of the six environments from the PESTEL framework. The article also gives an idea of the industry structure (for the wireless providers market, an oligopoly sometimes seen as a duopoly), competitive forces, and the competition itself. Finally, it also deals with the rivalry existing amongst competitors. Each competitor offers services that are globally similar to one another, mainly tweaking on prices, add-ons, and additional features. The competition itself in the wireless market is high with a duopoly ever-growing, and underdogs such as T-Mobile slowly catching up technologically speaking, with breakthrough deals that are likely to decrease prices over the next few years.

3) The merger between T-Mobile and MetroPCS, even though it hasn't be approved yet by officials (FOJ and FCC) and shareholders of MetroPCS (MetroPCS is likely to approve the deal whatsoever since the management already sealed it), will give T-Mobile a stronger power than it has now amongst competition. It will help the company to grab a significant market share in a really short amount of time. It will also help the company to build successful strategies to continue its growth, especially in the prepaid market, with low phone bills and equivalent services to contract-phones. Also, the merger will help T-Mobile to quickly enlarge the span of its network, to improve its quality, and to improve its speed thanks to the technologies currently used by MetroPCS and the plan T-Mobile has to provide a 4G LTE network.