US telcos Verizon Wireless (NYSE:VZ) and T-Mobile US (NYSE:TMUS) have agreed to exchange AWS and PCS spectrum licences worth a total US$173m. The transaction, which is subject to regulatory approval, is expected to close in the fourth quarter of this…
US telcos Verizon Wireless (NYSE:VZ) and T-Mobile US (NYSE:TMUS) have agreed to exchange AWS and PCS spectrum licences worth a total US$173m.
The transaction, which is subject to regulatory approval, is expected to close in the fourth quarter of this year, T-Mobile US said in a SEC filing.
In an FCC filing outlining why the agreement is in the public interest, Verizon and T-Mobile US – the country’s largest and third-largest wireless carriers respectively – noted that it involves only the transfer of spectrum; no network or other assets or customers are involved.
“The assignments are, in all markets, intra-market licence exchanges that will enable more efficient operations resulting from larger blocks of contiguous spectrum and/or the alignment of spectrum blocks held in adjacent markets,” the operators said.
“All of these intra-market exchanges involve the exchange of an even amount of spectrum, where neither party will increase its spectrum holdings in the market.”
The deal includes spectrum swaps in parts of Arkansas, California, Illinois, Indiana, Iowa, Kentucky, Massachusetts, Minnesota, Mississippi, Missouri, Montana, New York, North Dakota, Ohio, Pennsylvania, South Dakota, Tennessee and Virginia.
The companies contended that the arrangement will enable them to make more efficient use of the spectrum and offer improved services to customers.
“Aligning the spectrum blocks held in adjacent market areas allows the carriers to operate more efficiently by facilitating handoffs when users transition to the adjacent markets,” they said.
The carriers said the swaps don’t raise competition or other public interest concerns as they will both hold the same amount of spectrum post-closing.