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Telecom Consolidation Is Just a Matter of Time: T-Mobile CEO

Wednesday, 1 May 2013 | 10:56 AM ET
Wireless Wars Hits Whole New Level
Wednesday, 1 May 2013 | 9:45 AM ET
John Legere, T-Mobile US, explains how he plans to take on rivals; and discusses his company's merger with MetroPCS. The new company will now be known as T-Mobile USA, and will trade under the symbol TMUS.

Consolidation in the telecom industry is going to happen, and T-Mobile is "always open" to integrating with a range of other companies, said its U.S. president and CEO told CNBC on Wednesday.

With T-Mobile in fourth place behind Verizon, AT&T and Sprint in total wireless subscribers, John Legere said "my desire is to make Number 4 Number 3." He said it is an open question whether regulators would allow such a merger.

"If there is going to be a requirement for us to stand alone, they're going to try to find a way to make spectrum on the low band much more available," Legere said on "Squawk on the Street.."

"If I can get my hands on low band spectrum, I can really have a field day."

(Related: Pros Bet on a Spike in Blackberry)

Estimating that 85 percent of the EBITDA in his industry is controlled by the top two players, "if that pervades over time and somebody else doesn't come in, my feeling on consolidation is that it's not a matter of 'if,' it's 'when?' " he said.

Although T-Mobile is structured to be a stand-alone business, Legere said the company "can also be a very powerful component" for others in the sector.

One of the potential players is Dish Networks, and Legere said that he would "love to talk to them."

"Dish has an innovative idea about the future. They need somebody to build out their spectrum and partner with," he said. "They're playing in consolidation—Sprint is, Softbank is—because they need something. Right now, we don't really need anything, but we're always open," he said.

T-Mobile has also recently changed its plan offering for customers, since most young mobile users will themselves exceed the data capacity of most popular plans, Legere said. These plans also require no contracts and look to simplify the pricing structure. "It's a whole new model on the side of the customer and I'm going to innovate even more," he said.

On Wednesday, T-Mobile announced the closing of a deal to acquire MetroPCS and begin trading under the combined company's ticker symbol TMUS with an estimated market cap of $25 billion. After the deal, Legere sees approximately $6 billion to $7 billion of synergies created in the new company.

(Read More: T-Mobile US shares rise in New York Stock Exchange debut)

"The spectrum is so highly complementary," Legere said. He added that the company will keep both brands and expand them in the coming months, and he predicted that his company could be the market leader in the New York City area by next year. "I think it's a great growth opportunity."

— By CNBC's Paul Toscano. Follow him on Twitter and get the latest stories from "Squawk on the Street" @ToscanoPaul

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