As part of the recent acquisition of TelCove Inc. , network operator Level 3 Communications Inc. (NYSE: LVLT) will gain more than 300 LMDS (local multipoint distribution service) and 39GHz licenses that cover 90 percent of the population of the United States. (See Level 3 Takes TelCove.) So what does Level 3 plan do with all that spectrum?

Recent comments from the company's CEO indicate that the company might just get rid of it, but some analysts think that would be a mistake.

On a conference call the day of the acquisition announcement, Credit Suisse analyst Pat Dyson asked whether there are "any assets that… you would look to sell off in the near or medium term."

"I think we will review the wireless spectrum," replied James Crowe, CEO of Level 3. "We'll take a hard look at it and make a decision about what to do with it in the period between now and closing."

The deal is due to close in the third calendar quarter of 2006. A Level 3 spokesman declined to elaborate further on the company's spectrum plans.

Crowe noted in the conference call that the spectrum is "up at the higher ends of usable wavelengths."

Indeed, the higher the frequency, the shorter the range. (That's why AM radio stations, which start at 535 KHz, keep going and going on long car trips.) 39 GHz, meant for fixed wireless services, is near the top of the range of commercial spectrum. LMDS operates from 27.5 to 29.5 GHz and from 31 to 31.3 GHz. It, too, is considered suitable for fixed-wireless services -- a "last mile" way to bring voice, data, and multimedia services to the home without wires.

"It's suitable for backhaul," says Tole Hart, a research director at Gartner Inc.

And so some industry experts say Level 3 might want to think about keeping and using those licenses to boost its fiber optic network. Like Metamucil, Level 3 could be a fiber supplement.

"They're trying to expand their fiber facilities, and wireless is an awesome way of doing that," says Darrin Mylet, vice president of wireless services at the financial services firm Cantor Fitzgerald, which deals in spectrum sales. "I think [getting rid of the spectrum] would be a mistake. They could use it to extend the capabilities of that fiber… a few miles out." (He notes that this is his opinion and not necessarily that of Cantor Fitzgerald.)

"It can indeed be used for 'wireless fiber' kinds of services," says Craig Mathias, a principal at the Farpoint Group .

— Carmen Nobel, Senior Editor, Light Reading