The Dow Jones Industrial Average (DJINDICES:^DJI) was up 15 points in early afternoon trading Thursday despite freshly updated GDP numbers showing a 1% decline in the first quarter.

Dow components AT&T (NYSE:T) and Verizon (NYSE:VZ)  were both down slightly on Thursday. These two companies are the gorillas of the U.S. telecom market, dwarfing rivals Sprint (NYSE:S) and T-Mobile.

A report today from CNN Money, though, reminds investors that the battle for telecom supremacy stretches beyond the domestic front. Major players with serious scale are eyeing the U.S. market for growth.

It's an Asian Invasion
Japan's SoftBank, for example, already owns nearly 80% of Sprint. Many industry observers expect SoftBank to continue its push into the U.S. with a bid to buy T-Mobile in the next few months.

If the bid succeeds and obtains regulatory approval, the new company would achieve the size and scale needed to truly challenge AT&T and Verizon. So far, neither Sprint nor T-Mobile has posed a serious threat to the two industry leaders. 

Sprint has a market cap of just over $36 billion and hasn't made a profit in memory. The company reported a loss of subscribers in the first quarter, an increased churn rate overall, and its new "Framily" pricing plan appears to be losing the price war with Verizon, AT&T, and particularly T-Mobile.

Sprint's first-quarter average revenue per user was down by $0.51 for postpaid subscribers and $0.99 per prepaid subscriber compared to the year-ago period. 

S Net Income (Quarterly) Chart

S Net Income (Quarterly) data by YCharts.

How would buying T-Mobile help?
T-Mobile added 1.3 million new postpaid mobile subscribers in the first quarter, stomping the growth figures at Verizon and AT&T (539,000 and 625,000, respectively).

This comes after T-Mobile added 869,000 postpaid subscribers in the fourth quarter. In terms of market share, no company is benefiting more from the current price battles than T-Mobile.

AT&T attempted to buy T-Mobile for $39 billion in 2011, but regulators scuttled the deal. A SoftBank acquisition has a better chance for approval, but it's far from a slam dunk.

The best-case scenario for SoftBank is that the deal goes through, and the combined scale of a new Sprint/T-Mobile tie-up lifts margins sufficiently to continue T-Mobile's growth while reversing Sprint's losses.

The new combined company would still be significantly smaller than both AT&T and Verizon, but it would large enough to compete on infrastructure investment and turn a profit (hopefully).

Don't forget about China
The CNN Money story focused on the other gorilla in the industry, China Mobile. With over 760 million subscribers, China Mobile is far and away the largest mobile telecom in the world. For context, the company has three times the number of subscribers as Verizon and AT&T... combined!

Domestic dominance in China has leaders of the state-owned company concerned about concentration risk, so they have allowed two Chinese competitors to join forces to compete. Meanwhile, China Mobile is looking abroad to find growth.

To enter the U.S. market, China Mobile would need to either acquire an existing U.S. carrier (T-Mobile, we're looking at you) or win spectrum rights at a future auction. 

What's the real long-term threat?
For Verizon or AT&T investors currently shifting in their seats at the thought of a new competitor with 760 million subscribers already on the books, you can relax. 

One of the most likely outcomes is a strategic partnership between China Mobile and AT&T or Verizon. The move would make sense as China Mobile brings technical expertise in complementary high-speed wireless technologies that would enhance the U.S. network.

Perhaps even more importantly, China Mobile would bring the financial backing to help finance future spectrum purchases that mutually benefit the strategic partnership.