T-Mobile to beef up its LTE network with spectrum from Verizon

T-Mobile to beef up its LTE network with spectrum from Verizon
One of T-Mobile's New Year's resolutions was "4G LTE - go faster, go LOUD". We're not so sure about the going "LOUD" part of it, but we're getting news about how T-Mobile is planning to extend coverage and maybe even boost speeds. T-Mobile has announced a deal to purchase some unused 700 MHz spectrum from Verizon in order to beef up its LTE network.

The deal will have T-Mobile paying $2.365 billion in cash and transfering certain AWS and PCS spectrum licenses, which are reportedly worth approximately $950 million to Verizon in exchange for 700 MHz A-Block spectrum licenses. The new spectrum will cover approximately 158 million people in major markets including New York, Los Angeles, Dallas, Houston, Philadelphia, Atlanta, Washington D.C., and Detroit. The press release for the deal says that it will lead to T-Mobile "having important low-band spectrum in 9 of the top 10 and 21 of the top 30 markets across the United States", so it sounds like the deal is to beef up LTE offerings in major markets rather than extending coverage to new areas, which is more of a customer "pain point" for T-Mobile users. 

The transfer of the spectrum isn't expected to go through until Q4 of 2014, but it will definitely help to strengthen the UNcarrier's LTE offerings in some of the busiest regions of the country. 


Low-band spectrum covering approximately 150 million people will further improve customer experience in major metro areas, boosting in-building and breadth of network coverage

BELLEVUE, Wash., Jan 06, 2014 (BUSINESS WIRE) –T-Mobile US, Inc. (NYSE: TMUS) today announced that its wholly-owned subsidiaries T-Mobile USA, Inc. and T-Mobile License, LLC have signed agreements to purchase certain 700 MHz A-Block spectrum licenses from Verizon Wireless for $2.365 billion in cash and the transfer of certain AWS and PCS spectrum licenses, which have an aggregate estimated value of approximately $950 million. The transactions, combined with T-Mobile’s existing A-Block holdings in Boston, will result in T-Mobile having important low-band spectrum in 9 of the top 10 and 21 of the top 30 markets across the United States.
“This is a great opportunity to secure low-band spectrum in many of the top markets in America,” said John Legere, President and CEO of T-Mobile. “These transactions represent our biggest move yet in a series of initiatives that are rapidly expanding our already lightning fast network and improving its performance across the country. We will continue to find ways to advance our customers’ network experience just as our bold Un-carrier moves have shaken up the wireless industry to benefit consumers.”

These are significant transactions that will further enhance a rapidly improving network experience that T-Mobile expects will create shareholder value. Low-band spectrum substantially improves in-building coverage as well as coverage in rural areas. It also travels greater distances than high-band spectrum and therefore is a more efficient way to provide coverage at the edge of cities and in less densely populated areas. Combined with its existing Boston A-Block holdings, T-Mobile will have low-band spectrum covering approximately 158 million people — including New York, Los Angeles, Dallas, Houston, Philadelphia, Atlanta, Washington D.C., and Detroit. T-Mobile anticipates rolling out service and compatible handsets on this A-Block spectrum as early as the fourth quarter of 2014.

In 2013, T-Mobile continued its rapid LTE rollout, deploying 10+10 MHz 4G LTE in 43 of the top 50 metro areas and it is commencing substantive deployments of 20+20 MHz 4G LTE in 2014. The company launched its nationwide 4G LTE network in 2013, which currently covers approximately 209 million people in 273 metro areas.

Also, as part of the transaction, the two companies will realign spectrum blocks in certain markets, primarily in northern California and the Atlanta area.

The agreements are subject to approval by the Federal Communications Commission and the Department of Justice, and other customary closing conditions. Following regulatory approval, these transactions are expected to close in mid-2014.

TAP Advisors worked as financial advisors for T-Mobile on this transaction.[/PRESS RELEASE]

source: BGR

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