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T-Mobile Excited About Next Year’s 600 MHz Spectrum Auction

September 30, 2015 - Written By David Steele

There are four national carriers operating in the United States of America at the time of writing, split into the larger pair of AT&T and Verizon Wireless, plus the two smaller carriers, Sprint and T-Mobile US. These carriers are in a constant state of network improvement and expansion in order to keep up with customer demand for a better mobile device experience with smartphones, tablets, modem dongles for laptop computers and cars. And whilst today’s high performance networks have capacity and speed for many customers, more and more are joining every day making increasing demands on the data. On a related note, early next year the FCC (or Federal Communications Commission) is managing an auction to sell off spectrum in the 600 MHz frequency, which is being realized by broadcasters releasing the spectrum. The low frequency spectrum is important to carriers as the lower the frequency, the greater the propagation of the signal and the fewer masts that are required to cover a given area. T-Mobile’s statistics show that it requires five mid-frequency masts to provide the same level of service as a single 600 MHz tower provides.

T-Mobile US’ LTE network has been designed and built around mid-frequency spectrum, which is unable to penetrate buildings as well as the 600 MHz spectrum. The carrier has bolstered its network by buying up spectrum at the 700 MHz point, but is clearly excited about the prospect of buying spectrum at the 600 MHz point: the carrier is set to use this spectrum to create a national core LTE network, which would be boosted by higher frequency spectrum in areas of higher demand. Braxton Carter, T-Mobile’s Chief Financial Officer, explained that the carrier could have as much as $10 billion as a war chest to invest on 600 MHz licences over the next twelve months. However, Braxton also explained that he did not think the business would need to spend this much on spectrum. He also stated that he expects bids in the auction from businesses outside of the wireless industry and that the auction should offer “robust action.” The carrier is also pleased that the FCC has agreed to withhold 30 MHz from the two larger carriers for the smaller players in the market, which includes but not exclusively T-Mobile US. “It’s a victory for us.” He said on the matter.

It remains to be seen how the cellular carrier landscape will change following the 600 MHz auction. Sprint has pulled out of the 2016 auction and is instead concentrating on deploying its 2,500 MHz spectrum, which has already been successful in Denver and looks set to be repeated across the country. Sprint’s lack of participation in the 600 MHz auction should be good news for T-Mobile US as it reduces the competition for the spectrum, and it will be interesting to see how the two smaller carriers develop their network seemingly in opposite directions.