Friday, April 18, 2014

ATT considers taking a pass over 600Mhz spectrum rules

Unlike previous FCC spectrum auctions the FCC is now considering a policy for next year’s 600Mhz spectrum auction. Their plan is to restrict a portion of the frequency band for smaller competitors to ensure AT&T and Verizon don’t grab all the 600Mhz spectrum and squat on it, which prevents smaller companies from entering the wireless market. This policy comes after the last few spectrum auctions where Verizon and AT&T gobbled up the majority of spectrum for sale and still haven’t used a lot of the spectrum they have available now. AT&T was the first carrier to complain to the FCC in a letter stating the following:

"AT&T has never declined to participate in a major spectrum auction and certainly did not intend to do so here, where capital contributions will be needed across the wireless industry for a successful outcome. But if the restrictions as proposed are adopted, AT&T will need to seriously consider whether its capital and resources are directed toward other spectrum opportunities that will better enable AT&T to continue to support high quality LTE network deployments to serve its customers."

From this statement it sounds like AT&T is only interested in the auction if they can buy the entire 600Mhz spectrum band. Just like the 700Mhz auctions a few years ago the 600Mhz bands are highly desirable because they have better in building penetration and require fewer cell towers for coverage in rural areas. This is why both T-Mobile and Sprint are less than successful in rural areas where their 1700/1900/2100/2500Mhz bands don’t cover as large an area. Verizon and AT&T’s 700Mhz requires substantially less towers in a rural setting to cover the same space and if Sprint or T-Mobile could snatch up the 600Mhz spectrum we could see them start to offer better rural coverage.