Sprint is the latest wireless carrier in the United States to attract investment from overseas as international companies look to gain a foothold in the mobile market here.

Sprint announced yesterday that Japanese carrier Softbank is purchasing a 70 percent stake in the company for $20.1 billion. International wireless carriers are interested in U.S. companies because the market is quickly growing, with a lot of upside potential still to come.

?Foreign investment in U.S. mobile carriers reflects that we live in global economy and the US market ?with its high smartphone penetration and leading ARPU ? offers an attractive growth area for operators in mature markets with lower growth prospects,? said Susan Welsh de Grimaldo, director of mobile broadband opportunities at Strategy Analytics, Boston.

?Outside investment supports the US leading role in wireless, with opportunities for further investments in robust 4G networks, as planned and in the works for Sprint, TMO and VZW,? she said.

?In addition, U.S. operators with outside investors benefit from deeper visibility into operator successes in other markets, with lessons learned and broader depth of experience around mobile content and marketing.?

Regulatory approval
Softbank will not be the only international company with a strong investment in a U.S. wireless carrier.

When the recently announced T-Mobile USA, MetroPCS merger goes through, Germany wireless carrier Deutsche-Telekom will have a 74 percent stake in the new company.

Additionally, British wireless carrier Vodafone owns a 45 percent stake in Verizon Wireless.

This leaves only AT&T out of the major wireless carriers that cannot claim significant international investment.

All of the international companies mentioned here hail from countries that the U.S. has close ties with and so the deals typically do not raise any regulatory concerns.

?Company ownership of the mobile operators by ?friendly? nations such as Japan is not likely to raise significant interest from the US Congress ? just as very little notice is given to the Vodafone interest in Verizon Wireless,? said Chris Nicoll, principal analyst at Analysys Mason, London.

With so many international companies seeing a reason to invest in U.S. wireless carriers, the question is why are U.S. companies not making similar investments?

?The U.S. is the largest, most competitive 4G mobile market in the world,? Mr. Nicoll said. ?Few U.S. companies with a telecommunications focus have USD 8-20Billion burning a hole in their pockets and stepping into the competitive environment here is not for the faint of heart.?

Deal comes with risks
The deal comes with a lot of risk for Softbank, something others may not be willing to undertake.

?After all is said and done with the Softbank investment, Sprint still has to find a way to add 40M subscribers in the US to match the scale of the top operators,? Mr. Nicoll said. ?To date, subscribers have been voting with their wallets for AT&T and VZW.

?Sprint has to change a lot of minds, and do it in competition with T-Mobile.?

One of the possible concerns with the deal is that Softbank has also announced plans to acquire rival eAccess in a bid to become the second-largest mobile operator in Japan. However, there is a risk that undertaking two such big deals at the same time could stretch Softbank?s management too far.

Sprint is also already in the middle of two big initiatives of its own ? modernizing its network and acquiring the iPhone. The deal with Softbank could divert attention away from these important strategies.

The upside of the deal is that it will provide Sprint with the scale and financial power to compete more aggressively with Verizon Wireless and AT&T, which are the two largest wireless carriers in the country.

?For Softbank it is a huge bet that it?s better to invest $20 billion in the third-largest US mobile operator rather than its home market of Japan where it is the third-largest mobile operator behind NTT DoCoMo and KDDI,? said Mike Roberts, principal analyst at Informa Telecoms & Media, Westborough, MA.

?While it?s true that Softbank?s investment could pay off by making Sprint significantly more competitive, it?s also true that there?s a huge risk that the deal will not go to plan and could weaken both companies at critical times,? he said.

Attracting marketers
The deal, which is expected to go through by the middle of next year, could have implications for marketers down the road.

It all depends on how aggressively Softbank wants to move into the U.S. market.

Softbank and Sprint expect to create a stronger, more competitive U.S. wireless carrier entity. The U.S. carrier will also leverage Softbank?s experience with LTE as it continues its national rollout of 4G LTE.

The deal is expected to provide Sprint with $8 billion in capital to enhance its mobile network and strengthen its balance sheet.

?I would say U.S. marketers could benefit if Softbank investment into Sprint is approved, given Softbank?s major role as an Internet company, as Softbank make look to use the cash infused in Sprint to make acquisitions ? or partnerships ? to strengthen Sprint?s mobile platforms and attract marketers,? Strategy Analytics? Ms. Welsh de Grimaldo said.

Final Take
Chantal Tode is associate editor on Mobile Marketer, New York