Wireless operators T-Mobile USA and Verizon Wireless plan to swap advanced wireless services (AWS) spectrum in 218 US markets, with T-Mobile purchasing additional licences from Verizon for an unspecified sum. The proposed deal includes licences that…
Wireless operators T-Mobile USA and Verizon Wireless plan to swap advanced wireless services (AWS) spectrum in 218 US markets, with T-Mobile purchasing additional licences from Verizon for an unspecified sum.
The proposed deal includes licences that Verizon Wireless is acquiring from SpectrumCo and Cox for US$3.9bn, and from a deal with Leap, making the spectrum swap with T-Mobile contingent on the closing of those transactions.
The companies say the transaction will allow them to create more contiguous blocks of spectrum and re-align spectrum in adjacent markets, meaning they can rollout LTE more effectively.
T-Mobile will gain spectrum covering 60 million people in exchange for Verizon getting spectrum covering 22 million people and a cash payment. In a statement T-Mobile said the deal was in addition to its previously announced US$4bn modernisation plan, which includes upgrading its 37,000 cell sites, launching 4G in the 1900 MHz band and the deployment of LTE in 2013.
The transaction is subject to approval by the Federal Communications Commission (FCC), which T-Mobile anticipates it will receive late this summer.
Meanwhile Verizon’s US$3.9bn deal with a number of spectrum owners is still pending regulatory approval. The FCC has extended the time it has to evaluate that deal, with influential senator Herb Kohl expressing concern over the purchase at the end of last month.
One of the FCC’s main concerns is that Verizon is “hoarding” spectrum, but the proposed spectrum swap with T-Mobile might serve as a remedy to address those concerns.
Verizon has said that the deal with T-Mobile USA is contingent on its AWS purchase from cablecos receiving the green light from the regulator.
