Verizon Wireless has gotten the final green light it needs to proceed with its acquisition of spectrum from seven different companies, including four cable companies. As expected, the Federal Communications Commission has approved the four deals that will transfer 1.7/2.1 GHz spectrum licenses to the nation’s largest carrier.
The biggest part of the deal is Verizon’s $3.9 billion purchase of Advanced Wireless Service (AWS) spectrum from cable operators Comcast, Time Warner, BrightHouse and Cox Communications. The carrier is getting almost 20 megahertz of spectrum in the 1.7/2.1 GHz band. This spectrum is well suited for networks that include multiple cell sites in densely populated areas, and should enable Verizon (VZ) to add capacity to its LTE network. As a condition of approval, the FCC is requiring Verizon to make data roaming available to competitors at reasonable rates on the acquired spectrum.
The spectrum transfer is just one part of Verizon’s deal with the cable operators. The companies have also agreed to co-market products in areas that they both serve. Critics have argued that this will enable Verizon to forego some fiber optic network installations, and rely instead on the cable companies’ wires to help create bundles of cable, Internet and wireless service for customers. Fewer wires serving an area could mean less choice and higher prices for consumers.
Earlier this year, Verizon said that if it were able to acquire this spectrum, it would sell all of its A- and B-Block 700 MHz spectrum licenses. Verizon acquired 77 licenses in the B Block and 25 licenses in the A Block during the FCC’s 2008 spectrum auction and all of those licenses are now expected to be sold to other carriers. “We expect a very robust sales process as more than 65 parties have requested and received information about the spectrum we are selling,” said Verizon CEO Dan Mead.
Verizon is also trading some of its existing 1.7/2.1 GHz spectrum licenses to T-Mobile USA in exchange for some of the smaller carrier’s licenses in the same band class. The companies have said they want to create “more contiguous blocks of spectrum and re-align spectrum in adjacent markets.”
The nation’s largest carrier is also swapping spectrum with Leap Wireless and its subsidiary Savary Island Wireless. Leap will get 12 megahertz of 700 MHz spectrum covering Chicago and Verizon will get various 1.9 GHz and 1.7/2.1 GHz spectrum licenses in return.
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