T-Mobile USA and Leap Wireless looked to shore up some spectrum shortages in their respective networks, announcing the exchange of licenses covering a handful of markets. The deals were technically made between the operators as well as affiliates of the respective carriers that are fiscally backed by the operators.
The deal calls for T-Mobile USA’s partner Cool Inlet to exchange 1.7/2.1 GHz spectrum licenses with Leap partner Savary Island Wireless. T-Mobile USA will receive licenses covering portions of Alabama, Illinois, Missouri, Minnesota and Wisconsin, while Leap will receive 10 megahertz of wireless spectrum covering Houston, Galveston and Bryan-College Station, Texas; and Phoenix. The deal also includes “intra-market exchanges” between the operators in Philadelphia; Wilmington, Del.; Atlantic City, N.J.; and various markets in Texas and New Mexico. Leap CEO Doug Hutcheson noted the “intra-market exchanges” would “allow us to re-align spectrum in key markets into contiguous channels thereby optimizing our delivery of wireless services.”
Leap noted the transactions help bolster its spectrum holdings for planned LTE deployments, which the carrier recently begun rolling out in Tucson, Ariz. The carrier announced late last year a deal with Verizon Wireless to acquire a 12 megahertz patch of spectrum in the 700 MHz band covering Chicago from its larger rival for $204 million and in turn sell various 1.9 GHz and 1.7/2.1 GHz spectrum licenses to Verizon Wireless for $188 million.
Leap last month signed a a five-year wholesale deal with Clearwire that will provide Leap and its Cricket brand with LTE coverage for customers when they are outside of the company’s native markets. The deal will take advantage of Clearwire’s plans to rollout TD-LTE using its 2.5 GHz spectrum assets. Leap would need to procure devices capable of handling that spectrum band and technology as well as its legacy CDMA network using its 1.7/2.1 GHz and 1.9 GHz spectrum and its LTE network using 700 MHz and 1.7/2.1 GHz spectrum. The Clearwire deal followed the collapse of its one-time deal with LightSquared that has hit the skids due to LightSquared not being able to garner control of its 1.6 GHz spectrum holdings due to interference concerns with some ground-based GPS systems.
For T-Mobile USA, the deal strengthens its network plans that are expected to include a host of spectrum re-farming initiatives designed to free up spectrum to begin the roll out of LTE services. T-Mobile USA announced in late February it plans to install new equipment at 37,000 cell sites and re-farm spectrum in the 1.9 GHz band currently used for its GSM-based services to launch HSPA+ services, which would then allow for the re-farming of its 1.7/2.1 GHz spectrum currently used for HSPA+ services to bolster the spectrum gleaned from the merger break up to launch LTE in the 1.7/2.1 GHz band.
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