On Wednesday, sources speaking to the Wall Street Journal said that Sprint and T-Mobile agreed on the “broad terms” of a merger and were nearing a final agreement. Preliminary reports said that Sprint would acquire T-Mobile for $50 billion, or about $40 a share.

Such a huge merger between the third and fourth largest wireless providers in the US would certainly face intense scrutiny from regulatory agencies, and WSJ's sources said that if the deal were to fail to go through, Sprint would pay T-Mobile $1 billion “in cash and other assets.”

Earlier this year, the rumor was that Sprint would pay T-Mobile around $19 billion for a 60 to 70 percent stake in the Deutsche Telekom-backed company. Today, WSJ reported that Deutsche Telekom would only retain a 15 to 20 percent stake in T-Mobile after a deal with Sprint. As Ars wrote in December, if Sprint and T-Mobile join, the two companies would have a combined 53 million postpaid subscribers compared to Verizon's 95 million and AT&T's 72 million.

This move comes a few years after AT&T and T-Mobile attempted a high-profile merger that was shot down by US regulatory agencies. In 2011, AT&T offered $39 billion for T-Mobile, but that deal drew a wide range of criticism. Sprint even filed a petition with the FCC to try to block that merger.

Although Dish Network promised to make a bid for T-Mobile earlier this year, it appears that the company is out of the running.

The Wall Street Journal reported that, “The companies are also considering forming a joint venture to bid together in upcoming auctions of wireless airwaves currently held by television broadcasters.” That could beef up Sprint's network, a stated goal of Masayoshi Son, CEO of Sprint owner SoftBank. Son said on The Charlie Rose show that if Sprint were to buy T-Mobile, it would wage a “massive price war” to draw subscribers away from the two big incumbents, Verizon and AT&T.