AT&T (NYSE:T) and T-Mobile USA formally filed with the FCC to transfer some of AT&T's AWS spectrum to T-Mobile. The spectrum transfer is a condition of the $6 billion breakup fee AT&T will pay to T-Mobile parent Deutsche Telekom stemming from AT&T's failed $39 billion takeover of T-Mobile.
"This additional spectrum will help meet the growing demand for wireless broadband services," Tom Sugrue, T-Mobile's senior vice president for government affairs, said in an emailed statement to the Wall Street Journal. "We hope the FCC will move swiftly to approve the license assignments."
As part of the breakup fee, T-Mobile will get AWS spectrum from AT&T in 128 market areas, including in 12 of the top 20 markets in the United States: Atlanta, Boston, Baltimore, Dallas, Denver, Houston, Los Angeles, Phoenix, San Diego, San Francisco, Seattle and Washington, D.C. T-Mobile wants to use the extra spectrum to expand capacity on its HSPA+ network. (Currently, T-Mobile offers an HSPA+42 network covering 184 million POPs in 175 markets).
The breakup fee includes $3 billion in cash, as well as a seven-year UMTS roaming agreements that will allow T-Mobile to expand its coverage to 280 million POPs from 230 million today. AT&T abandoned its bid for T-Mobile in December amid opposition from the Department of Justice, FCC and some of its competitors, most notably Sprint Nextel (NYSE:S).
- see this WSJ article (sub. req.)
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