T-Mobile Pays Verizon Nearly $2.4 Billion USD for A-Block Spectrum
January 6, 2014 11:11 AM
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Verizon is receiving certain AWS and PCS spectrum licenses in exchange for the A-Block spectrum
T-Mobile and Verizon have swapped airwaves in an effort to gain spectrum where the two U.S. carriers need it most. T-Mobile paid Verizon $2.365 billion USD in cash for certain 700 MHz A-Block spectrum licenses. In exchange, Verizon is receiving certain AWS and PCS spectrum licenses from T-Mobile worth approximately $950 million USD.
On T-Mobile's end, the new licenses will fill in the gaps in its network coverage. More specifically, it will provide T-Mobile with low-band spectrum in nine of the top 10 markets across the U.S.
“This is a great opportunity to secure low-band spectrum in many of the top markets in America,” said John Legere, President and CEO of T-Mobile. “These transactions represent our biggest move yet in a series of initiatives that are rapidly expanding our already lightning fast network and improving its performance across the country. We will continue to find ways to advance our customers’ network experience just as our bold Un-carrier moves have shaken up the wireless industry to benefit consumers.”
This could make T-Mobile look even more appealing in a
. Just last month, it was reported that SoftBank Corp. -- which already acquired U.S. carrier Sprint last summer for $21.6 billion USD -- is in talks with banks like Credit Suisse Group AG, Mizuho Bank Ltd, Goldman Sachs Group Inc and Deutsche Bank AG in an effort to acquire a majority stake in T-Mobile. The deal has been valued at around $20 billion.
Some reports say T-Mobile could continue filling in its coverage gaps by looking to other owners of A-block spectrum, such as U.S. Cellular Corp. But nothing has been confirmed in that area yet.
T-Mobile raised approximately $4 billion USD last year in an effort to buy new spectrum licenses and expand its network.
As for Verizon, its new AWS and PCS spectrum licenses from T-Mobile will help relieve wireless network congestion in cities with heavy traffic (which affects performance). These key cities are Los Angeles, San Francisco, Dallas, Detroit and Atlanta.
The deal is expected to close by mid-2014.
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RE: Great news for TMobile.
1/7/2014 12:26:11 PM
Lower frequencies Carry farther, and penetrate structures more easily.
Higher frequencies generally have a higher data throughput though. Kind of a trade off.
RE: Great news for TMobile.
1/7/2014 2:11:44 PM
For 1900 spectrum more towers may be required, but that is probably less of a problem for Verizon. I'm guessing their network of tower leases is much stronger than Tmob's.
I wonder how much of the ATT merger cash Tmob has left?
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