AT&T (NYSE:T) boosted its spectrum holdings in 18 states by consummating a deal announced last January to acquire 39 lower 700 MHz B Block spectrum licenses from rival Verizon Wireless (NYSE:VZ).
AT&T paid $1.9 billion cash and transferred to Verizon 1.7/2.1 GHz Advanced Wireless Services (AWS) spectrum licenses in Phoenix, Ariz.; Los Angeles and Fresno, Calif.; Albuquerque, N.M.; and Portland, Ore., to Verizon. In exchange, AT&T gained 700 MHz licenses covering 42 million POPs in California, Colorado, Florida, Idaho, Illinois, Louisiana, Montana, New Mexico, New York, Ohio, Oklahoma, South Dakota, Tennessee, Texas, Utah, Virginia, Washington and Wyoming.
AT&T will use the 700 MHz licenses as part of its ongoing LTE deployment. Its LTE service current covers 225 million POPs, and the carrier aims to reach nearly 270 million by the end of this year. Its LTE rollout should be substantially complete by next summer.
Similarly, Verizon will use the AWS licenses it gained to add capacity to its own LTE network, which remains the largest in the United States. It covered 301 million POPs as of Aug. 1.
The FCC approved the spectrum license transfers on Sept. 3. The transaction was a result of Verizon Wireless' spectrum sale process announced in May 2012 for its lower 700 MHz spectrum licenses. Verizon agreed to sell its Lower 700 MHz A and B Block spectrum if the FCC approved its $3.9 billion purchase of nationwide AWS spectrum from a group of cable companies, including Comcast, Time Warner Cable, Bright House Networks and Cox Communications.
Eight companies, including AT&T, signed license purchase agreements as part of the sale process. Aside from AT&T, the remaining seven consisted of six small or regional telecom carriers and one minority-owned firm.
Verizon said the only purchase in the group that has not yet closed is a pending transaction with Grain Management, a private equity firm that invests in the telecommunications sector. In January, Verizon said it would sell lower 700 MHz B Block licenses covering the Charlotte, Greensboro and Raleigh-Durham markets in North Carolina to the firm for $189 million. Verizon will, in turn, lease from Grain Management an AWS license covering Dallas, which Grain is acquiring from AT&T.
For more:
- see this AT&T release
- see this Verizon release
- see this Engadget article
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