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T-Mobile spent $1 Billion on 700MHz Spectrum in Southeastern US

February 26, 2016 - Written By Alexander Maxham

Since T-Mobile bought the 700MHz A Block from Verizon in early 2014, they’ve been working to gain as much 700MHz A block spectrum as they can, throughout the US. You see this band is very, very important to T-Mobile. The sub-1GHz spectrum allows carriers to cover more area without adding another tower into their network. While the 2GHz and higher spectrum has less coverage but much more bandwidth – meaning it can handle more connections, very important for 5G. T-Mobile didn’t have any low-band spectrum until they bought that 700MHz A block from Verizon. A big reason why their in-building coverage and coverage period, was pretty mediocre. Since acquiring the spectrum, they have been rolling it out at a rapid pace and increasing coverage all over the country.

On their Q4 2015 earnings call, T-Mobile noted that they had bought even more 700MHz spectrum licenses and would be working to roll out that coverage in the coming months. T-Mobile didn’t state where the spectrum was, or how much it cost them. However we now know that they spend nearly a billion on that spectrum that is covering Utah, New Mexico and other parts in the southeastern area of the US. This is all thanks to SEC filings and those that follow the spectrum purchases and swaps.

Allnet Insights & Analytics have published a report on the amount that T-Mobile has spent on this spectrum, as well as who they bought the licenses from. T-Mobile’s SEC filings stated that “in January 2016, T-Mobile acquired spectrum licenses covering nearly 20 million people in seven major metro markets for approximately $0.6 billion in cash”

They also added that in “January and February 2016, T-Mobile entered into agreements with multiple third parties for the exchange of certain spectrum licenses and the acquisition of 700MHz A Block spectrum licenses covering approximately 48 million people, for approximately $0.7 billion in cash. Now, according to Allnet Insights & Analytics, the carrier has already made agreements with nine companies to pick up their 700MHz A Block spectrum, which would cover around 49 million people. These are all still pending with the FCC, so they can’t start building it out just yet. As the FCC has to approve all spectrum transactions.

In the picture down below, you’ll see the updated 700MHz A Block spectrum map for T-Mobile, once all of these purchases are approved by the FCC. You’ll see that the majority of California is already covered by T-Mobile. They did pick up a few areas outside of the aforementioned Utah, New Mexico and Southeastern US. For instance, you’ll see some licenses from Cavalier Wireless in Idaho and Washington. These purchases will indeed take the carrier from 200 million POPs to 249 almost 250 million POPs. It doesn’t seem like a huge difference, but it definitely helps them out.

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