Back in 2014, Verizon sold a good bit of their unused 700MHz spectrum over to T-Mobile. Before that purchase, T-Mobile had zero spectrum under 1GHz, which actually explains why their in-building coverage was so poor – and still is in some areas. Since acquiring that spectrum from Verizon, T-Mobile has been rolling out 700MHz spectrum all across the country, and they now have coverage in a number of areas where they didn't used to have it. The carrier has also been steadily buying up more and more 700MHz spectrum licenses from regional carriers. And T-Mobile is still looking for more.
In January of this year, T-Mobile acquired spectrum licenses that cover 20 million people in seven of the biggest metro areas. This cost them about $0.6 billion in cash. This is according to a SEC filing from T-Mobile. They also noted in that filing that they spent $0.7 billion in cash for more spectrum in January and February of 2016, which covers about 48 million people. This spectrum is coming from regional carriers like Cavalier, C700 and Cellular South.
Now T-Mobile is looking to issue about $1 billion in bonds, so that they can buy even more 700MHz spectrum. Essentially, Magenta is looking to fundraise here. They are already the majority owner of 700MHz spectrum in the US, and looking to get even more. The carrier is expected to spend nearly $8 billion on airwaves in the upcoming Incentive Spectrum Auction that officially starts today, for 600MHz spectrum. These new bonds are said to be issued as senior notes, which are said to be pretty secure. In fact, in the event of bankruptcy, they still need to be paid back. Additionally, they are issued in a registered public offering and will be due in 2024.
T-Mobile's CFO, Braxton Carter, recently said that with their Extended Range LTE service (aka their 700MHz spectrum) covering over 305 million people now, many of which are in new areas from where T-Mobile had service before, that they need to capitalize on that and add more retail stores. This part of the reason why they have been going around the country doing the #BallBusterChallenge and showing everyone that they do have service (and good service at that) in many new cities and towns.