Verizon, Sprint, AT&T detail spectrum exchanges covering PCS, AWS licenses

spectrum light (pixabay)
Verizon and Sprint said they swapped PCS spectrum licenses covering locations in Washington, Oregon and elsewhere.

Although Sprint, AT&T and Verizon all largely sat out the FCC’s recent incentive auction of TV broadcasters’ unwanted 600 MHz licenses, they are clearly still actively interested in gaining the best spectrum position possible. Indeed, all the nation’s carriers, including T-Mobile, have inked spectrum exchanges or purchases in the secondary spectrum market in recent months.

First up, Verizon and Sprint said they swapped PCS spectrum licenses covering locations in Washington, Oregon and elsewhere.

“In 11 of the 13 markets, there is an even exchange of PCS spectrum and the Applicants’ spectrum aggregation totals will remain unchanged,” the companies wrote in their public interest statement (PDF) to the FCC detailing the transaction. The FCC oversees all spectrum transactions.

“In the remaining markets where the exchange is not even, Sprint will acquire an additional 5 MHz (2.5 x 2.5 MHz) in Bremerton, Washington, and Verizon will acquire an additional 10 MHz in Danville, Illinois.” the statement continued. “Although Verizon and Sprint provide service to customers using all of the licenses that are being exchanged, any operations in a block to be assigned will be transitioned to the corresponding block of spectrum that is being acquired in this transaction, except with respect to Danville, Illinois, where Sprint will shift its operations to other spectrum blocks it already holds. These transitions will be seamless and invisible to customers, and there will be no discontinuance, reduction, loss or impairment of service.”

RELATED: In 2017, how much low-, mid- and high-band spectrum do Verizon, AT&T, T-Mobile, Sprint and Dish own, and where?

In its quarterly filing with the SEC, Verizon acknowledged a spectrum exchange with Sprint, but said it didn’t have any financial impact.

"This noncash exchange is expected to be completed in the second quarter of 2017 and we expect to record an immaterial gain,” the carrier wrote in its filing.

But Sprint and Verizon were not alone. Indeed, in the fourth quarter Verizon said it inked a similar agreement with AT&T covering PCS and AWS licenses.

“This noncash exchange was completed in February 2017, at which time we received $1.0 billion of AWS and PCS spectrum licenses at fair value and recorded a pre-tax gain of $0.1 billion in Selling, general and administrative expense on our condensed consolidated statement of income for the three months ended March 31, 2017,” Verizon wrote of the transaction.

T-Mobile too in its recent SEC filing said that, during the first quarter, it “closed on an agreement with a third party for the exchange of certain spectrum licenses. Upon closing of the transaction, we recorded the spectrum licenses received at their estimated fair value of approximately $123 million and recognized a gain of $37 million included in Gains on disposal of spectrum licenses in our Condensed Consolidated Statements of Comprehensive Income.”

The carrier added that, on April 17, it entered into an agreement with a third party for another exchange of certain AWS and PCS spectrum licenses.

“These kinds of spectrum trades occur monthly between all of the big players; AT&T, Verizon, T-Mobile, Sprint and U.S. Cellular,” noted Brian Goemmer, president of spectrum analysis firm Allnet Insights & Analytics.