T-Mobile USA unit may be close to a deal to buy wireless spectrum from Clearwire, reports Business Week and Bloomberg.
The sale of the spectrum could happen by the end of the first quarter, say the reports, but T-Mobile USA isn’t in a rush to buy spectrum and can demand a financially advantageous deal.
T-Mobile, the fourth-largest mobile-phone operator in the U.S. after Verizon Wireless, AT&T Inc. and Sprint Nextel, accounts for about a quarter of the German company’s sales. The company may fund the spectrum purchase with proceeds from the sale of its U.S. telecommunications towers, valued at $2 billion by analysts.
Clearwire has lots of spectrum available at 2.6 GHz. The company has some 120 MHz available in most urban areas but uses only about 30MHz for its currently operational WiMAX (4G) service (at 10 MHz per sector).
In 2003-2004, Craig McCaw stitched together a nationwide 2.6 GHz network right under the eyes of AT&T and other telecommunications giants.
Clearwire may be cash poor, but it is spectrum rich, owning some 120 MHz of 2.6GHz spectrum in major cities throughout the United States.T-Mobile paid $4.2 billion for 20 Mhz of nationwide AWS spectrum (1700/2100 MHz) in 2006. T-Mobile’s HSPA+ network uses that spectrum. Clearwire is currently conducting LTE tests in Phoenix, Arizona (see DW: Clearwire to Test LTE ). Verizon’s LTE uses 2×10 MHz channels.
Clearwire is testing 90Mbps LTE, using LTE in 2×10 MHz, 2×20 MHz and 1×20 Mhz (TDD) configurations using gear from Samsung and Huawei. During the trials, Clearwire will collaborate with Beceem and other partners to determine the best combined WiMAX/LTE configuration. Spectrum at 2.6GHz is available world-wide for 4G and gear is now available off the shelf.
LightSquared’s updated ATC plans were approved by the FCC. Now, in addition to the 80-90 MHz of 2.6 GHz (4G) spectrum available from Clearwire at 2.6 GHz, cellular carriers may now go to satellite providers like Lightspeed/Inmarsat (at 1.6 GHz) and Terrestar/ICO (at 2 GHz). Both may soon have some 20 MHz available for nationwide terrestrial LTE networks as an adjunct to their satellite backbones.
The FCC last month laid out a roadmap for satellite players to sell terrestrial-only devices using their satellite spectrum, reports industry analyst Tim Farrar. DISH Networks has agreed to acquire DBSD (ICO) for $1B. In conjunction with TerreStar, which is also valued at roughly $1B in its bankruptcy, this creates the opportunity for potential partners to consider using a rival 40MHz block of 2GHz MSS spectrum instead of investing in LightSquared or Clearwire.
DBSD and TerreStar (using 2 GHz) and Lightsquared and Inmarsat (using 1.6 GHz) are valuable not just because of their huge operational $250 million satellites, but because their spectrum can now be used terrestrially, via the Ancillary Terrestrial Component (ATC) rules of the FCC.
- Echostar’s Charlie Ergen is maneuvering for control of both DBSD and TerreStar. That may result in his virtual control of the MSS satellite band (2 x 20 MHz).
- Lightsquared and Inmarsat use the L-Band (1.6 GHz spectrum). Lightsquared is paying Inmarsat to use some of their spectrum for a similar spectrum grab in the L-Band (1.6GHz). Lightsquared has a $7 billion commitment with Nokia Siemens Networks to build their ground-based LTE network.
Still, T-Mobile USA strategy presentation (pdf) last month poured cold water on expectations that T-Mobile has a pressing need to acquire more spectrum. The company stated that it would not need additional spectrum until 2014.
Sprint probably needs LTE spectrum, too. If Sprint got 40 MHz, T-Mobile got 40 MHz and Clearwire got 40 MHz, then the three partners could put the spectrum squeeze on AT&T and Verizon. Comcast could sell their shares and go with their AWS spectrum for mobile voice. That gives each of the 4 major carriers about 90 MHz of spectrum each, so it (theoretically) could be good for competition (and regulators).
That kind of 2.6 GHz spectrum sale would force AT&T and Verizon to go with the riskier satellite route to acquire more spectrum. Perhaps Verizon would pair with Lightsquared/Inmarsat (at 1.6 GHz) and AT&T with TerreStar/ICO (at 2 GHz). Nationwide coverage for public service users might be enhanced with satellite coverage and partners like AT&T and Verizon.
What would Craig McCaw and Larry Page do? Google Voice is an integral part of Android 2.3 and Google already has $500M invested in Clearwire. If they bought the rest of the Clearwire shares and spectrum from Comcast & TWC for $2B, then they might be able to spin-off Clearwire and deliver 20Mbps “wireless cable” to the home using WiMAX 2. Triple play. Fiber to the node.
There’s always something popping at Mobile World Congress. Rumors and all.
Related DailyWireless stories includes; Charlie’s Big Play, White House: D-Block to Police/Fire, T-Mobile: No Spectrum Deal…Yet, T-Mobile Makes Its (4G) Move, Clearwire testing 90Mbps LTE, FCC Green Lights Lightsquared, LightSquared: In Trouble?, Lightsquared Unfurled, MetroPCS Eyes TerreStar, SkyTerra 1 Launched, Broadband Satellites: Black Hole?, MSS: Stuck in Space, Satellite with 328 ft Antenna to Launch, SkyTerra 1 Launched,
