complete its Sprint acquisition at long last almost four months ago, the road from third to first place in the market is still paved with major network upgrade challenges and a lengthy spectrum integration process.But although the "Un-carrier" has managed to
redeploys the "Now Network's" mid-band spectrum in cities like Philadelphia, New York, Chicago, Houston, and Los Angeles is its concurrent effort to improve low-band speeds nationwide. For the time being, that represents the backbone of T-Mo's 4G LTE and 5G networks, but in order to strengthen said backbone and enable faster downloads for the masses, the ever-expanding wireless service provider needs outside help.One of the lesser-discussed trials faced by Magenta as it slowly
Even though it was far from the biggest Magenta-related story of the past few months, some of you might remember reading an early April Opensignal report about the significant speed upgrades made possible by Dish Network and the Federal Communications Commission, among others.
Unfortunately, the FCC's Keep Americans Connected Pledge was designed right off the bat to temporarily help T-Mo handle increased consumer demand during a delicate phase of the coronavirus pandemic. While COVID-19 rages on in the US, claiming around a thousand lives every day, Magenta could only use Dish's 600 MHz spectrum for free by July 1.
With no new licensing agreement in place, the spectrum was gradually decommissioned starting in late June, which reflected into an immediate and fairly drastic 4G LTE speed drop, according to recent tests performed by Opensignal and published by Lightshed Partners.
Interestingly, T-Mobile didn't pay up to extend its free lease contracts with several other spectrum hoarders owners, which seems to suggest the notoriously tough negotiating tactics of Dish chairman Charlie Ergen were not the only problem here.
Whether or not T-Mobile wants to cooperate with Dish after taking such an unnecessarily long time to close the Boost Mobile divestiture deal, and whether or not Ergen is prepared to give up a solid chunk of the low-band spectrum he's been so unscrupulously hoarding for so many years, it sure looks like the two companies will need to find a way to get along at some point.
That's because a longer-term lease was actually one of the conditions imposed by the DOJ to approve the T-Mobile/Sprint merger last year, and if Magenta and Dish can't reach an understanding soon, the Department of Justice is expected to intervene. That may well happen in a matter of weeks, which probably explains why T-Mo was not quick to sign leases with other 600 MHz spectrum owners apart from Columbia Capital.
The "Un-carrier" might be expecting to see how much it will ultimately have to spend for Dish's precious unused cellular technology. Lightshed analysts believe a 3-year lease worth no more than $400 million a year could be on the table, with Dish likely to request (and be granted) the option to reclaim any of its spectrum after 18 months.
At least in theory, that sounds like a win-win scenario, reenabling some major 4G LTE and 5G speed improvements for many T-Mobile customers while the operator continues working on beefing up its mid-band network layer and at the same time helping finance Dish's ambitious 5G buildout from scratch.
Then again, the fact that both companies stand to gain so much from a prospective extended collaboration all but guarantees the negotiations are far from over.