T-Mobile and Comcast took a time out from making digs about each other’s broadband and wireless offerings to forge a spectrum deal. In an SEC filing, T-Mobile revealed that it has agreed to lease, and eventually acquire, Comcast’s 600 MHz spectrum licenses for a price of between $1.2 billion to $3.3 billion. The final price of the deal will depend upon how many licenses T-Mobile ends up using.
T-Mobile EVP and CFO Peter Osvaldik told investors during a Bank of America Media, Communications & Entertainment Conference today that the company plans to start deploying 5G in some markets right away. Osvaldik said this additional low-band spectrum is appealing for 5G because of its ability to penetrate buildings and provide a wide swath of coverage, not because the company is concerned about capacity. “This allows us to deploy more of our low-band 5G strategy,” he said. “We have the radios ready to go.”
T-Mobile already has a significant amount of 5G deployed in the 600 MHz spectrum band. The company's low-band 5G, which it calls "Extended Range," uses 600 MHz and reaches about 323 million POPs.
The entire deal includes 71 licenses covering 149 million people. Each market’s license covers 10 MHz of spectrum, except for Nashville, Tennessee, which covers 20 MHz of spectrum.
Comcast is committed to selling licenses covering approximately 39 million POPs and including markets outside Comcast’s cable footprint such as New York City; Orlando, Florida; and Kansas City, Missouri. These licenses are a required part of the purchase agreement and Osvaldik said T-Mobile will begin deploying its network in these markets first. According to New Street Research, these licenses are valued at $1.2 billion.
The other licenses are within Comcast’s cable footprint and cover approximately 110 million POPs in markets such as Chicago; San Francisco; Baltimore/Washington, D.C.; Boston; Miami; and Nashville, Tennessee. These licenses are optional and according to New Street Research, they are worth $2.1 billion.
When asked why Comcast is keeping some licenses as optional for purchase, Osvaldik said that the company wants to keep its options open in its existing operating markets. “Options are smart,” he said.
Comcast SVP of Wireless Strategy Tom Nagel described the deal in a blog post as a “lease to purchase” arrangement and said that Comcast has retailed the option to reclaim the 600 MHz licenses within its markets if it needs it.
T-Mobile will make quarterly lease payments to Comcast for the spectrum with a final payment and the close of the deal to occur in the first half of 2028. The license transfer will be filed with the FCC in the first half of 2027 and until this point Comcast has the right to remove any of the optional licenses from the table.
Nagel said that the company is selling these licenses to T-Mobile because it realized that it is unlikely to need them. He added that Comcast, which has been conducting 5G network field tests using its 3.5 GHz CBRS spectrum, found that its CBRS spectrum has “exceeded our expectations.”
Starting this month, Xfinity Mobile and Comcast Business Mobile customers in Philadelphia will begin connecting to Comcast’s 5G network for the first time, Nagel said. Up until now, the network has only handled traffic from Comcast employees. Comcast revealed about a year ago that it was using Samsung’s 5G gear in its CBRS and 600 MHz spectrum in Philadelphia to improve customer experience and lower its costs. Because Comcast has already deployed 5G equipment in the 600 MHz spectrum in Philadelphia, that license is not part of the sale.
New Street Research said in a research note that they believe T-Mobile is aiming to achieve 40 MHz of 600 MHz spectrum throughout the entire U.S. Before this transaction, they had about 40 MHz of 600 MHz spectrum in 76% of the markets. With this deal, they are filling in gaps and adding more spectrum in 23 of the top 50 markets.
New Street also noted that If Comcast sells the entire portfolio of licenses for $3.3 billion it will be a 102% increase over what it paid for them.
This latest deal comes on top of T-Mobile’s purchase about a year of 600 MHz spectrum from Columbia Capital for $3.5 billion. That deal included licenses ranging from 10 MHz to 30 MHz per market and covered more than 108 million people, or about one-third of the U.S. population.