AT&T looks to sell remaining 600 MHz spectrum to LB License Co

Columbia Capital possible total 600 MHz spectrum holdings (Allnet Insights)
Columbia Capital is looking to purchase virtually all of AT&T's 600 MHz spectrum licenses.

AT&T is looking to sell off what appears to be nearly $1 billion worth of 600 MHz spectrum after locking up all 50 states to its FirstNet offering last week.

Just what will become of those airwaves is far from clear, however.

The nation’s No. 2 mobile network operator filed a document with the FCC indicating it would transfer its 600 MHz holdings to LB License Company, an affiliate of Columbia Capital, a Beltway-area venture firm focused on telecom and media. While the filing doesn’t disclose terms of the deal, the website Facticia earlier this week reported LB Spectrum Holdings planned to raise $928 million. AT&T's full FCC filing is available at the bottom of this article.

AT&T was the fourth-biggest bidder during the FCC's incentive auction of TV broadcasters' unwanted 600 MHz licenses, which ended in in early 2017. AT&T spent roughly $910 million on 600 MHz spectrum licenses covering select cities across the country.

Here is a map showing the licenses AT&T picked up in in the 600 MHz spectrum auction:

LB License Co said in the filing that it is “headed by a management team with extensive wireless operators expertise backed by sophisticated or institutional investors with deep experience in the telecommunications sector.” LB is housed in the same Alexandria, Va., office building as Columbia Crest, which last year was said to have been been planning to participate in the auction of TV broadcasters’ airwaves.

Columbia eventually walked away from the incentive auction empty-handed (PDF), while AT&T spent more than $910 million on the 600 MHz airwaves—a figure notably close to LB’s fundraising goal. License Co didn’t respond to a request for comment from FierceWireless Saturday, and an AT&T spokesman said he didn’t have the information at hand but would look into the matter.

Here is a map of Columbia's total 600 MHz spectrum holdings if its transaction with AT&T is approved by the FCC:

AT&T's proposed transaction with LB is the carrier's second transaction to offload its 600 MHz holdings. Brian Goemmer, president of Allnet Insights, said that in October AT&T filed an application to sell a portion of its 600 MHz spectrum holdings to TStar600, which he said is part of the Continuum Wireless group that sold their 700 MHz holdings to T-Mobile. He said that the two transactions cover all of the 600 MHz spectrum licenses AT&T purchased in the FCC's incentive auction.

The sell-off of 600 MHz airwaves may be related to AT&T’s winning of the FirstNet contract, which was announced last year. That deal enables AT&T to work with the government to build out a wireless network for first responders, and gives AT&T 20 MHz of 700 MHz spectrum that can also be used for commercial purposes.

Thus, it appears that FirstNet's 700 MHz spectrum is enabling AT&T to sell the 600 MHz holdings it won at auction less than a year ago.

“This backs up the theory that AT&T's interest in the 600 MHz spectrum declined during the auction and they only purchased what they had to based upon their deposits,” noted Goemmer. Allnet  closely monitors spectrum transactions. “Another interesting thought would be whether they needed to off-load this spectrum as they have accumulated virtually all of the FirstNet spectrum (700MHz) through the state opt-in process.”

The looming question, then is how those 600 MHz airwaves will be put to use—and by whom.

This article was updated Jan. 8 with additional information. Mike Dano contributed to this article.