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Rural Spectrum Wars Between T-Mobile And AT&T Continues

January 21, 2016 - Written By David Steele

T-Mobile US, North America’s uncarrier, is not afraid of upsetting the apple cart. Earlier today, the business trolled Verizon‘s quarterly earnings call with a press release detailing what listeners could do upon hearing Verizon say certain statements. Although the Verizon Wireless post is somewhat tongue in cheek, this article is somewhat more serious: T-Mobile US is continuing to urge the FCC, Federal Communications Commission, to block AT&T’s request to acquire a block of 700 MHz spectrum in a number of rural markets. T-Mobile’s statement states that this is: “AT&T’s latest attempt to raise its rivals’ costs at the expense of consumers.”

T-Mobile US’ filing follows AT&T last May announcing that they were intent on buying three 700 MHz C Block licenses in Kentucky, Ohio and West Virgina from East Kentucky Network, and use the acquired spectrum in order to increase existing capacity in these markets. AT&T’s statement at the time stated that the additional spectrum would be used to enhance existing coverage and allow the national carrier to launch new products and services. T-Mobile US immediately moved to block AT&T’s acquisition. America’s uncarrier has explained that AT&T’s potential acquisition means that FCC should undergo an “enhanced review,” as any acquisition of spectrum under 1 GHz that results in a single carrier gaining control of one third could make life extremely difficult for other carriers. This one third coverage rule is a part of the FCC’s push at maintaining a healthy competition between the national carriers, but T-Mobile’s filing goes on to say, “But with the FCC having never denied a transaction under this standard, the aspiration words of the Mobile Spectrum Holdings Order have begun to ring hollow. If ever there were a transaction the FCC should deny under ‘enhanced factor’ review, it is AT&T’s proposed acquisition of low-band spectrum in parts of West Virginia, Ohio and Kentucky. These are mostly rural markets where AT&T already controls 60 percent of the market in some areas and stands to benefit from excluding competitive entry.”

These are certainly strong words from T-Mobile, but the uncarrier has never been one to shy away from a fight! T-Mobile’s filing goes on to explain that the uncarrier would be happy to acquire spectrum in these markets at a market-based, non-foreclosure price and if this were to happen, it would move to quickly roll out its coverage at this point in the frequency range in order to order to benefit consumers. Clearly, T-Mobile have a vested interest in blocking AT&T (and of course Verizon) from acquiring large chunks of spectrum but it will need to be able to roll out its own coverage in these markets in order for their words to be more than an empty threat.