As merger talks heat up the telecomm industry, one in particular has faced more regulatory scrutiny than others: Sprint acquiring T-Mobile. In hopes of putting together a foolproof argument before officially coming before lawmakers, the companies involved will not be making their pitches before September, according to new reports.

The merger was expected to be announced sometime during the summer, but it's become clear that there are still some kinks to work out, according to unnamed Reuters sources. People familiar with the matter also told The Wall Street Journal that Sprint's recent strides in the areas of network performance have also affected the timing of the merger, dubbed "Project Oregon" on Wall street.

So what exactly is the holdup about? The debate revolves firmly around market consolidation.

Regulatory lawmakers from the Federal Communications Commission (FCC) and the U.S. Department of Justice's antitrust department believe customers could be harmed by reducing the number of national U.S. carriers from four to three. Less competition, they argue, inevitably breeds some undesired results such as higher prices.

That argument, however, Sprint executives argue, isn't true. Sprint currently sits at No. 3 in the wireless market with around 55 million customers. T-Mobile comes in behind Sprint with 50 million. Both companies pale in comparison to AT&T's 116 million and Verizon's 122 million subscribers. By combining forces, Sprint argues, it can have the scale and deep pockets needed to expand its coverage and give Americans access to a better third alternative. Sprint and T-Mobile currently lack a significant rural or suburban footprint.

"I brought the network war and price war [to Japan]. I'd like to bring that to the States," Sprint parent company SoftBank Corp.'s chief executive Masayoshi Son said to industry officials in March.

"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."

"If you have more customers, you can afford to build a larger network," Sprint CEO Dan Hesse told CNET in an interview. "Only then do you have the revenue to justify building in smaller suburbs and rural areas. If you live in an urban core, you will have access to AT&T and Verizon, and you'll also likely have access to T-Mobile and Sprint. But when you go to less populated areas, Sprint and T-Mobile might not be there."

In case the deal falls through, Sprint and T-Mobile have been also working on a $10 billion coalition to gain the low-frequency spectrums needed to expand during next year's FCC spectrum auction.

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