Earlier this morning in separate press releases T-Mobile and Verizon have announced a deal to swap AWS spectrum between both carriers for an undisclosed amount following months of saber rattling and public statements against the nation’s second largest carrier and its long-stalled SpectrumCo transaction which is currently under review by federal regulators following official complaints by T-Mobile as well as other carriers due to the perceived nature of the transaction being another attempt by Verizon to actively hoard spectrum instead of allowing other companies a fair opportunity to bid and purchase spectrum necessary for 4G network deployments.
The terms of the deal will involve Verizon handing over some of its AWS spectrum holdings to T-Mobile, with T-Mobile handing over spectrum in key markets as well as a cash payment in an undisclosed amount in order to resolve the long-standing impasse between Verizon and smaller carriers regarding its behavior on spectrum purchases. The swap involves spectrum holdings for 218 markets across the country while the under review SpectrumCo purchase involves an additional 122 markets that cover specific regions.
In theory, the swap should help T-Mobile accelerate its timeline for LTE deployment while giving Verizon more compatible spectrum to work with, as it recently offered specific blocks of its 700MHz holdings (A/B) due to the difficulty in pairing them for its LTE network, with many carriers rejecting the offer due to the interference issues present in those blocks.
Should this deal be approved by regulators, which is separate from the SpectrumCo deal, T-Mobile will gain spectrum covering 60 million people 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. with Verizon gaining spectrum holdings covering 22 million people and the previously mentioned unspecified cash payment.
With this deal being made, Verizon should have one less opponent to the SpectrumCo transaction, which is expected to be formally closed later this Summer, though other carriers are still opposed to the transaction as a whole, which will no doubt add to the overall struggles carriers face in terms of having enough access to spectrum in order to accommodate network deployments and depth of coverage.
