AT&T Snaps Up Qualcomm's LTE Spectrum

AT&T Inc. (NYSE: T) has added to its Long Term Evolution (LTE) assets by agreeing to buy the 700MHz licenses currently owned by Qualcomm Inc. (Nasdaq: QCOM) for US$1.925 billion.

Qualcomm has been using the valuable spectrum for its FLO TV service, but has decided to shut down that service from March 2011. (See What to Do About FLO TV?)

But while the wireless chip specialist no longer has any use for those airwaves, AT&T's initial LTE service offering uses the 700MHz band, so it can make good use of Qualcomm's spectrum as it ramps up its mobile broadband services strategy. (See 4G World: AT&T – an LTE Tortoise.)

The two companies expect the sale of the licenses to be completed in the second half of 2011, subject to regulatory approval.

Why this matters
Any additional spectrum in the 700MHz band is valuable to the US LTE players as they look to provide the best possible mobile broadband services.

AT&T says the spectrum it is buying from Qualcomm covers 300 million people across the US, and that it will use the extra capacity to boost downstream connections to its customers using "carrier aggregation technology," though this will only come into effect once "compatible handsets and network equipment are developed."

So although the spectrum isn't immediately available and usable, it gives AT&T (subject to the acquisition closing without any problems) the chance to develop its medium-term LTE service rollout and marketing plans around significant additional network capacity capabilities. In the meantime, the operator is looking to make the most of its 3G spectrum. (See AT&T Confirms Move to 21Mbit/s HSPA+.)

For more
The LTE market in the US is shaping up to be a major battle:

— Ray Le Maistre, International Managing Editor, Light Reading

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