Verizon Wireless, T-Mobile Agree to Massive Spectrum Deal
T-Mobile, it seems, isn't afraid to do a little wheeling and dealing to improve its lot. The company's proposed merger with AT&T might have crumbled under the weight of intense legal scrutiny, but today, T-Mobile and Verizon Wireless announced they've agreed to a massive AWS spectrum swap designed to improve performance needs and expansion wants for both companies' 4G networks.
The agreement includes swapping or outright buying spectrum licenses for a whopping 218 markets covering roughly 82 million people. T-Mobile would gain spectrum covering 60 million people -- many in larger cities, including Washington D.C, Philadelphia and Seattle -- while Verizon would gain spectrum covering 22 million in addition to "certain cash consideration."
T-Mobile says that the deal will improve its spectrum in 15 of the top 25 U.S. markets and help with the company's LTE rollout in 2013. Verizon would get a cash infusion and be able to shore up its own LTE network.
There are several "ifs" involved, however, that could foul up the deal.
The first "if" is a biggie; chunks of the spectrum Verizon is offering includes licenses that are scheduled to be acquired in separate agreements the company has with SpectrumCo, Leap and Cox -- but those licenses aren't actually in Verizon's hands as of yet. Obviously, those deals have to be concluded before the deal between T-Mobile and Verizon Wireless could occur.
The agreement would also need to get the green light from both the FCC and the Department of Justice. The companies expect that approval to arrive later this summer.
Amusingly, T-Mobile asked the FCC to deny some of Verizon's spectrum swaps with Cox and SpectrumCo back in February, saying the deals weren't in the public interest. Now, some of those very licenses may end up in T-Mobile's hands. To be fair, T-Mobile's argument was that Verizon already had a stockpile of spectrum, and this transfers some of that excess to T-Mobile.
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