SoftBank CEO says Sprint could shake up U.S. 'oligopoly'
WASHINGTON (Reuters) - The chief executive of Japan's SoftBank Corp on Tuesday called the U.S. wireless market an oligopoly plagued by slow speeds and high prices and said his company's Sprint Corp could shake up the competition, but it would require a scale that Sprint cannot reach alone.
Masayoshi Son, the billionaire chief of SoftBank, in his first public speech to a U.S. audience since his company gained control of Sprint last year, lambasted the U.S. wireless market as offering "pseudo-competition."
Son did not directly speak about his efforts to engineer a merger of Sprint and T-Mobile US Inc, the No. 3 and No. 4 U.S. wireless carriers, but told reporters he hoped to meet again sometime with U.S. regulators, who so far have given a cold shoulder to such a deal.
He made a pitch for Sprint to not only challenge its traditional wireless competitors -- No. 1 player Verizon Communications Inc and No. 2 AT&T Inc -- but also wireline Internet providers such as Comcast Corp.
"I brought the network war and price war (to Japan). I'd like to bring that to the States," Son told an audience of industry officials at the U.S. Chamber of Commerce.
"I would like to provide an alternative to the oligopolistic situation that two-thirds of American households can only get access to one or two providers. I'd like to be a third alternative with 10 times the speed and lower price."
Son said Sprint has the same type of radio frequencies that helped SoftBank compete in Japan and SoftBank has technologies that could boost speeds and lower prices, but his companies needed more towers and other support to properly challenge the biggest Internet providers.
"We have the spectrum. We have the technology. But we need scale, efficiency to make an investment for the network," Son told reporters after his speech.
"We are already free cash-flow negative. So we can start a small fight but it does not scale, it does not last, it's not sustainable. We need to have a real fight, a long and deep and heavy fight. And for that, we need scale."
Both the chairman of the Federal Communications Commission, Tom Wheeler, and U.S. antitrust chief William Baer expressed skepticism about a merger of Sprint and T-Mobile after Son's round of meetings in Washington in February.
SoftBank is now focused on convincing the parties involved with the merits of a merger, a senior company executive said, adding that any moves toward pursuing a deal were now on hold. The official declined to be named because he was not authorized to speak about the matter publicly.
Son, who once threatened to set himself on fire as he pushed Japanese regulators to let him set up a high-speed Internet service, has shown he does not give up easily. He said he wasn't planning on new meetings with U.S. regulators during this trip, "but whenever we have the opportunity sometime in the future, that is I think necessary."
Son has repeatedly expressed his desire to make SoftBank the biggest mobile-related corporation in the world, and in the past has harshly criticized U.S. mobile networks and the degree of competition in the industry.
The potential for the deal and Son's criticisms have given an edge to the dynamic among top wireless executives.
"If Mr. Son is having a bad experience with US wireless, it must be because he's using Sprint," Jim Cicconi, AT&T's senior executive vice president for external and legislative affairs, said jokingly in an emailed statement.
Even T-Mobile's CEO, John Legere, an avid user of social media site Twitter, quipped last week, "Remember when people actually liked @sprint? Yeah, me either. #SprintLikeHell"
(Reporting by Alina Selyukh in Washington; Additional reporting by Sophie Knight and Yoshiyasu Shida in Tokyo; Editing by Leslie Adler)