T-Mobile, Verizon Spar Over Spectrum
In an effort to corner the market for Long Term Evolution (LTE) spectrum, Verizon Wireless is misrepresenting its need for more spectrum and its efficiency in using it, T-Mobile US Inc. claims.
In a blog post Wednesday, T-Mobile Director of Government Affairs for Technology and Engineering Policy Steve Sharkey voiced his opposition to Verizon's bid for the cable companies' Advanced Wireless Services (AWS) licenses in the 1.7GHz band and poked holes in the carrier's claims to be two times as spectrally efficient as T-Mobile.
Sharkey explains that T-Mobile's spectrum holdings vary by market, making it unfair to compare against an absolute subscriber number. Verizon also includes the spectrum T-Mobile will eventually gain from AT&T Inc. (NYSE: T) in its analysis, whilst excluding the AWS spectrum it could gain. And, it doesn't account for the fact that T-Mobile has more smartphone customers, he says. Finally, most of Verizon's spectrum is in the more efficient frequency bands below 1GHz, while all of T-Mobile’s spectrum is in bands above 1GHz.
"An analysis that takes these factors into account reveals that T-Mobile is actually more efficient than Verizon is in all five of the top markets, eight of the top-10 markets, and 31 of the top-49 markets, and that, on average, T-Mobile is 50 percent more efficient than Verizon in the top markets," Sharkey writes.
Sharkey also suggested that T-Mobile does a better job of using the spectrum it acquires immediately, while Verizon lets it sit idle, "in the case of AWS for five and a half years and counting," he said, adding that Verizon wants to lock down the last remaining block of available LTE-appropriate spectrum, despite its spectrum stockpile.
Why this matters
All of the wireless operators have decried a spectrum shortage, but their bid to acquire more of it has them duking it out with each other. Verizon has said only 5 percent of its customer base is on its LTE network at 700MHz, but that it'll need swift approval of the deal to avoid running out of LTE spectrum in some markets by 2013. But, T-Mobile says that repurposing its existing PCS and AWS bands for LTE isn't enough for it either -- it too needs more spectrum to deploy it nationwide and compete with its larger rivals.
The arguments sound eerily similar to those that Sprint Corp. (NYSE: S) and others expressed with regards to AT&T Inc. (NYSE: T)'s bid to acquire T-Mobile last year, which regulators ultimately blocked.
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— Sarah Reedy, Senior Reporter, Light Reading Mobile