BTIG's Walt Piecyk took a hard look at Verizon's math today, asking whether small cells really cost 80 percent less than spectrum. Piecyk notes that Verizon bid $5.2 billion for spectrum in 14 major and mid-sized markets in last year's auction of AWS-3 spectrum before opting out of those cities, choosing instead to invest roughly $1.5 billion in small cells in those markets. And he quotes Verizon CFO Fran Shammo, who recently said the carrier could have spent $6 billion to acquire spectrum in those markets but thought small cells were the better investment.
Piecyk wrote that BTIG "will continue to track Verizon's utilization of its existing spectrum and capital investment, which has been on the rise for the past three years. Verizon continues to assert that it is only using 40 percent of its available spectrum but that allocation is much higher in the markets that matter." Meanwhile, investors will continue to speculate about how much spectrum Verizon has yet to use – and how much it may need to pick up in the upcoming incentive auction. Post