BELLEVUE, WASH. and BASKING RIDGE, N.J.: T-Mobile and Verizon Wireless today agreed to swap some spectrum should federal regulators approve a $3.6 billion deal between Verizon and three cable operators. Verizon and T-Mobile agreed to exchange Advanced Wireless Services spectrum licenses in 218 markets across the U.S. Financial terms were not disclosed.
T-Mobile said the transaction “will improve its spectrum position in 15 of the top 25 markets” by allowing it to add acquire new spectrum and realign its existing holdings. It said the swapped and purchased spectrum could be “promptly deployed” upon regulatory approval.
“Some of the spectrum T-Mobile is acquiring in this transaction include licenses that Verizon is purchasing from SpectrumCo, Cox and Leap, and the agreement is contingent on the closing of those transactions and is subject to regulatory approval by the Federal Communications Commission and the Department of Justice,” T-Mobile said in its announcement.
T-Mobile CEO and President Philipp Humm said, “We anticipate FCC approval later this summer, in time for us to incorporate this new spectrum into our network modernization and the rollout of LTE services next year.”
Verizon announced last December that it struck an agreement to buy 122 AWS licenses from SpectrumCo—a joint venture among Comcast, Time Warner Cable and Bright House— for $3.6 billion. The carrier struck a separate deal with Cox TMI Wireless, previously a member of SpectrumCo, for another 30, 20MHz AWS licenses. Those deals remain under federal scrutiny pending approval. The FCC last month sent a letter to Verizon’s counsel asking for more information about its intent to sell its 700 MHz licenses if the commission approved the SpectrumCo deal.
“Would Verizon Wireless abandon its plan to sell its lower 700 MHz licenses if the commission does not consent to the sale of all the AWS licenses at issue to Verizon Wireless?” FCC Wireless Bureau chief Rick Kaplan inquired. This was the most recent official correspondence logged on the FCC’s transaction page; no response has been filed. Kaplan has since left the commission.
The FCC has another 77 days to approve or deny the deal if it elects not to extend its own 180-day shot clock again. It already added three weeks at Verizon’s request.
T-Mobile said the deal will give it coverage of an additional 60 million people—notably in Philadelphia; Washington, D.C.; Detroit; Minneapolis; Seattle; Cleveland; Columbus, Ohio; Milwaukee; Charlotte, N.C.; Raleigh-Durham, N.C.; Greensboro, N.C.; Memphis, Tenn.; and Rochester, N.Y.—in exchange for spectrum covering 22 million people and certain cash consideration.
The agreement also includes exchanges in a number of markets in which the companies will swap licenses to create more contiguous blocks of spectrum and re-align spectrum in adjacent markets. T-Mobile said the agreement is “in addition” to its $4 billion plan to upgrade 37,000 cell sites for 4G services in the 2 GHz band and deployment of LTE in 2013.
May 16, 2012:“FCC Presses Verizon on Spectrum Warehousing”
“Would Verizon Wireless abandon its plan to sell its lower 700 MHz licenses if the commission does not consent to the sale of all the AWS licenses at issue to Verizon Wireless?”
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