T-Mobile came in as the third top bidder in the C-band auction, spending $9.3 billion.
Of the top three carriers, T-Mobile needed C-band spectrum less than the other two because it got a treasure trove of spectrum as part of its purchase of Sprint. T-Mobile acquired more than 100 MHz of 2.5 GHz mid-band spectrum in top markets across the country from Sprint, much of which Sprint hadn’t fully built out. T-Mobile now has this spectrum available for 5G.
Plans call for T-Mobile to cover 200 million people with 5G on its 2.5 GHz spectrum by the end of 2021. And the un-carrier already has been reaching large portions of the United States with 5G on its 600 MHz spectrum. It also has millimeter wave spectrum, which it will use to augment capacity in certain areas.
In the C-band auction T-Mobile won bids in 72 markets. “These are largely the largest markets,” said telecom consultant Richard Engelman, speaking on a New Street Research call today. Of the 406 markets in the C-band auction, T-Mobile got spectrum in 62 of the top 100 markets and 10 of the bottom 306 markets. “They were consistent in the amount of spectrum, averaging two blocks per market,” said Engelman.
Even after Verizon's and AT&T's C-band haul, “T-Mobile still leads in overall sub-6 GHz holdings with an estimated ~352 MHz nationwide,” said Cowen analyst Colby Synesael in a note.
And Wells Fargo analyst Eric Luebchow said T-Mobile has the advantage of having not gone into heavy debt to obtain C-band spectrum. “To us, the clear ‘winner’ is T-Mobile, which scooped up 30 MHz of valuable spectrum, still retains a notable advantage in low-and-mid band holdings, and will not have the extended overhang of deleveraging,” said Luebchow.
T-Mobile this week filed its 10K annual report, and it stated, “We expect cash purchases of property and equipment to range from $11.7 billion to $12.0 billion in 2021. "According to the company’s financials, property and equipment does not include spectrum expenditures. So much of these capex funds may be available to build out 5G on its spectrum assets.