Sprint and T-Mobile: Joint Bidding on 600MHz?

Posted by Sam Churchill on

Sprint and T-Mobile are reportedly planning to jointly bid approximately $10 billion on spectrum in next year’s FCC incentive auction, according to the Wall Street Journal.

The $10 billion is part a $45 billion Softbank package meant to finance Sprint’s rumored acquisition of T-Mobile, the paper said. Any merger between Sprint and T-Mobile would require the approval of the FCC and Department of Justice, of course.

This joint venture will likely only happen if the merger deal is still in play at the time of the auction.

With 30 MHz reserved for smaller carriers, this joint venture would make money available for next year’s 600 MHz auction. A budget of $10 billion might buy a 20 MHz slice (10 MHz x 10 MHz), or two swaths of 10 MHz (5 MHz x 2).

Sprint shut down Nextel’s 800 MHz iDEN service in July 2013 and has since been refarming its 800 MHz spectrum for FDD-LTE service. Sprint expects to cover 150 million POPs with 800 MHz LTE by the end of 2014 as part of its tri-band Sprint Spark service.

Since Sprint has 800MHz towers, perhaps Sprint could use their infrastructure to host a joint 600 MHz network, although T-Mobile also plans to deploy 5×5 MHz 700 MHz A Block spectrum by year-end, which it acquired from Verizon for $2.4 billion.

Dish is also likely to bid on 600 MHz, perhaps spending some $5 Billion on 10 MHz (5 MHz x 2). That would leave the duopoly 40 MHz, or 20 MHz each, if the FCC’s guesstimate of 70 MHz freed by TV broadcasters proves correct.

Dish could be the new 4th network.

French operator Free Mobile, launched in 2012, built their own 2.6 GHz network to cover at least 25% of the French population. Free is now the second largest ISP in the country.

The French public is the beneficiary of this competition, notes Engadget. Rates are now lower across the board, with Orange, SFR and Bouygues all launching discount brands.

Free Mobile users can get 20 GB of LTE data for $27/month. That could deliver a fair amount of wireless streaming video – especially with H.265 encoding that could cut HD bandwidth nearly in half.

Both Dish and Sprint/T-Mobile appear to be positioned to deliver “wireless cable” on higher frequencies, while 600 MHz could provide voice and data roaming. Sprint is using 8T8R equipment at 2.6 GHz and is launching 40MHz carrier aggregation, with 60 MHz on deck. That’s 6x the bandwidth and more towers to deliver mobile video.

AT&T and Verizon are so 20th Century. Their only option is to buy a duopoly position to keep prices high and complain to government about unfair competition.

The real death star is Comcast. I hope Charlie keeps his cool.

Posted by Sam Churchill on Wednesday, July 16th, 2014 at 8:25 am .

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