Sprint reportedly finalizing acquisition of Open Mobile

Written by  //  January 31, 2017  //  Telecommunications/Technology  //  4 Comments

Print Friendly, PDF & Email

Sprint is reportedly wrapping up its acquisition of competitor Open Mobile in Puerto Rico. (Credit: © Mauricio Pascual)

Wireless carrier Sprint is reportedly in the final stages of acquiring competitor Open Mobile in what would be the first major change in Puerto Rico’s telecommunications landscape this year, two sources confirmed to this media outlet.

The transaction would be cashless, likely involving a share offering from Sprint to Open Mobile’s owners. It is expected to close later this month, the sources confirmed.

The sources said this deal makes sense for several reasons, including the fact that it would create a more robust network for Sprint, as it would be able to integrate Open Mobile’s CDMA/LTE technology into its operation.

“Sprint is essentially buying frequency and signal to add to its network,” said one of the sources that spoke under the condition of anonymity.

Open Mobile has been doing business in Puerto Rico since 2007, when M/C Venture Partners and Columbia Capital acquired the former MoviStar carrier for $160 million. Since then, the company made significant investments and carved a niche for itself as the first provider to offer no-contract wireless services, a practice that was replicated by other competing carriers.

However, sources confirmed Open Mobile has been struggling in recent years, with a drop in revenues and viability. Despite operational inefficiencies, the carrier is certified as an Eligible Telecommunications Carrier authorized to sell to the market that qualifies for Lifeline subsidies, which is an attractive asset for Sprint.

At present, Sprint is not ETC certified in Puerto Rico, so picking up Open Mobile would mean adding that segment of the population to its client roster, the sources said.

Lifeline is a segment that has been showing growth in Puerto Rico’s otherwise stagnating wireless market, partly in response to the island’s protracted economic crisis. The island has some 3.1 million active wireless lines.

Attempts to reach the general managers at both Sprint and Open Mobile were unsuccessful Tuesday. So, it remains unclear if the transaction will represent the end of the Open Mobile brand on the island, or if it will remain as a subsidiary or existing brand for certain products and services.

Sprint and Open Mobile compete against Claro de Puerto Rico, AT&T and T-Mobile.

4 Comments on "Sprint reportedly finalizing acquisition of Open Mobile"

  1. Wilfredo January 31, 2017 at 11:59 PM · Reply

    Desde la compra de los activos del difunto Movistar (2012) – en particular la codiciada frecuencia 700mhz, por PR Wireless (un joint venture de MC y Columbia Equity, la empresa se empaco para la venta. Originalmente fue un plan de 3 años para “engordarla” al mejor postor. El problema fue su presidente, Juan Saca, un extranjero del tercer mundo que no logro conectar con el exigente usuario boricua. El plan se atrazo 2 años hasta la compra de Sprint que se lleva cuajando desde el 2015 cuando Mauricio Claure entra como CEO de Sprint. Este “cuaje” fue seducido por Patricia Eaves quien tiene buena reputacion de seducir su camino hasta posiciones altas de empresas (seducir por sus looks no por su inteligencia si entienden lo que digo). El futuro de los usuarios de Open no luce bien. Sprint va a aplicar las mismas politicas y productos que son impuestos desde Kansas City. Olvidense que Sprint va a comprar una mejor red 4G LTE porque Open, como es conocido, tiene una red sin capacidad y obsoleta. Esto es un intento de Sprint para llegar al mercado de “retail” y segmentos mas bajos – Sprint no es experto en el mercadeo a ninguno de estos dos segmentos. Su enfoque siempre ha sido clientes corporativos y prime. Es obvio que Patricia se queda alfrente de la empresa y Juan se le cumple su deseo de irse a los USA. Veremos si Patricia logra “seducir” a Jorge Martel de Tmobile.

    • Luis R February 2, 2017 at 4:41 PM · Reply

      >> Sprint no es experto en el mercadeo a ninguno de estos dos segmentos. Su enfoque siempre ha sido clientes corporativos y prime.

      Eso debe ser el legado de Nextel que estaba mayormente dirigido a ese mercado. Hace años Sprint y Nextel se fusionaron.

    • Agustín February 6, 2017 at 2:59 PM · Reply

      Tus expresiones dan asco.

  2. Luis R February 2, 2017 at 4:38 PM · Reply

    I would not qualify the market as “stagnant” but saturated. Not much growth left in a market with 3.5 million people (and slowly declining) with 3.1 million active wireless lines. The other carriers appear to be doing fine. Open Mobile is the network that is used by Verizon Wireless customers still on CDMA phone that visit Puerto Rico as part of the “Extended Network” they can use without roaming charges. What will this mean for them? Verizon customers had issues in PR when Claro switched off their CDMA network in December 2015.

Leave a Comment

comm comm comm