Telecom Market To Benefit From Less Regulations, Lower Taxes, Says T-Mobile US Inc (NASDAQ:TMUS)

Telecom Market To Benefit From Less Regulations, Lower Taxes, Says T-Mobile US Inc (NASDAQ:TMUS)

The T-Mobile USA is one of the many companies that are looking forward to President-elect Donald Trump’s administration. In a Q&A session at a UBS investors conference, the company’s CFO, Braxton Carter, acknowledged his optimism over the industry following a less burdensome regulatory environment. Trump’s position over the telecom industry remains unclear, but there are speculations that he would relax regulations on businesses and also lower corporate taxes, though one can never tell with politicians.

Carter argues that regulation often destroys modernization and value creation. Thus less regulation including the dismantling of the FCC’s net neutrality rules will encourage more innovation from Internet providers because they will have more leeway. It becomes possible to bring enhanced benefits to consumers and shareholders. However, Carter did not illustrate the innovations that would come on board if net neutrality rules were eliminated. The nature of innovation being new and original, this is not surprising.

Likelihood of mergers and acquisitions

President Barack Obama imposed net neutrality rules during his tenure. This led to the reclassification of fixed and mobile ISPs as common carriers by the Federal Communications Commission. However, Carter seems confident about a reversal of the Title II decision.

He quotes, “With Title II being overturned there are a lot of really interesting things you could potentially do, but we’ll see what happens. It’s going to be an interesting year next year,”

But as all this happens, there is a looming possibility of a merger between Sprint and T-Mobile. Industry observers are speculating that the transaction may be possible under a Trump White House. Carter declined to address the speculations, but he was quick to state that people should expect to see some evolution. He also explained that various players the likes of Comcast Corporation (NASDAQ:CMCSA) and Charter are likely to consider an entry into the wireless industry.

But either way T-Mobile continues to make progress

There is power in knowing what the individual consumer is doing and what they are looking for. That said, and as everything else unfolds, T-Mobile continues to build progress in building out its 700 MHz spectrum licenses. This is one of the processes that is likely to open up a significant amount of new territories for T-Mobile. The company is targeting being able to sell its services in a third of the United States.

To this extent, T-Mobile has been able to build new retail stores and sales outlets in 400 new locations. Next year’s target is 30 to 40 million new potential customers. Meanwhile, T-Mobile’s stock closed at $55.99 witnessing an increase of $0.97 or 1.76%.