Verizon Wireless and T-Mobile US have asked the U.S. Federal Communications Commission to exchange blocks of spectrum, generally on a one-for-one basis, in hundreds of U.S. counties.
Such spectrum swaps are not unusual in the mobile business. In 2012, five mobile service providers agreed to trade blocks of spectrum, acquiring spectrum from Cox Communications.
The Verizon and T-Mobile US exchanges would both firms to operate more efficiently, since after the exchanges each firm would have larger blocks of contiguous spectrum. In some cases, the additional spectrum is contiguous to spectrum each carrier already is operating.
In either case, each carrier would benefit from using larger blocks of spectrum, and in some cases also benefit from contiguous spectrum.
The moves are mostly tactical, allowing each service provider to operate more efficiently, since the deals do not change the aggregate amount of spectrum holdings of either carrier.
The FCC’s initial review of the applications indicates that, after the transaction, Verizon Wireless would hold 67 MHz to 149 MHz of spectrum and T-Mobile would hold 30 MHz to 100 MHz of spectrum in the 518 counties covering parts or all of 133 different cellular markets.
Since the swaps generally are one for one, those holdings reflect the initial amount of spectrum licenses held by each mobile service provider.
The exchanges will not affect any current subscribers of either network, and involve blocks of spectrum not yet activated by either mobile operator.
In the case of the intra-market exchanges of equal amounts of PCS spectrum, Verizon Wireless
and T-Mobile would exchange 5 MHz to 20 MHz of PCS spectrum in 153 counties across 47 market areas, the FCC notes.
and T-Mobile would exchange 5 MHz to 20 MHz of PCS spectrum in 153 counties across 47 market areas, the FCC notes.
In addition, in 11 counties across three markets in Texas, Verizon Wireless would assign 20 megahertz of PCS spectrum to T-Mobile, and would receive 10 megahertz of PCS spectrum in return.
Also, Verizon Wireless would assign 5 to 10 megahertz of PCS spectrum to T-Mobile in an additional 34 counties across 13 market areas.
In the case of the intra-market exchanges of equal amounts of AWS-1 spectrum, Verizon
Wireless and T-Mobile would exchange 10 to 20 megahertz of AWS-1 spectrum in 285 counties across 59 CMAs.
In addition, in the Vineland-Millville-Bridgeton, NJ market, T-Mobile would assign 10 MHz to Verizon, and would receive 20 MHz of AWS-1 spectrum.
In the Oxnard-Simi Valley-Ventura, Calif. market, as well as the Eugene-Springfield, Ore. market, T-Mobile would assign 40 MHz and would receive 30 megahertz of AWS-1 spectrum.
Further, Verizon Wireless would assign 10 MHz of AWS-1 spectrum to T-Mobile US in 16 counties across four markets.
T-Mobile US would assign 10 MHz to 20 MHz of AWS-1 spectrum to Verizon Wireless in 26 counties across nine markets.
The swaps reflect a rationalization of spectrum each carrier had acquired in various auctions, but do not, in and of themselves, change market dynamics in the local markets or nationally. The swaps instead allow each mobile service provider to operate more efficiently, wringing more bandwidth out of the same amount of licensed spectrum, compared to the original set of holdings.
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