Did Verizon Outbid AT&T for Straight Path?

Dan Jones
4/25/2017

Straight Path said Tuesday that a "multi-national" operator has outbid AT&T in a bid to acquire its 5G-suitable spectrum, with the most likely contender being Ma Bell's major rival, Verizon.

Straight Path said that the new offer from the unnamed company is for $104.64 per share, or $1.8 billion in total, against AT&T's $1.6 billion bid, which included liabilities to be paid to the Federal Communications Commission (FCC) .

It was reported last week that Verizon Communications Inc. (NYSE: VZ) was considering topping AT&T Inc. (NYSE: T)'s initial bid for Straight Path Communications Inc. . The spectrum holder has fixed wireless licenses for 39GHz nationwide in the US, as well as 28GHz licenses in major cities such as NYC and San Francisco. (See Report: Verizon Considering Bid for Straight Path and AT&T to Flash $1.6B for Straight Path 5G Spectrum.)


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Verizon's motivation in outbidding AT&T -- if that is the case -- is to lock up control of nationwide 39GHz spectrum suitable for 5G long before any high-band auctions happen and deny AT&T access to that spectrum, which would leave it with meager options for initial 5G deployments. AT&T has said that it would initially use the 39GHz spectrum to deploy fixed wireless 5G services before moving to mobile. (See AT&T & Straight Path: What's It All Mean for US 5G?.)

AT&T has five days to beat the new bid. Straight Path investors appear to be betting that it will try, as Straight Path's shares are up $12.38 -- or 11.16% -- at $123.27 in morning trading.

— Dan Jones, Mobile Editor, Light Reading

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kq4ym
kq4ym
5/5/2017 | 11:28:22 AM
Re: Alt headline: Bidding War for Straight Path
Although sometimes the "winner" of a bidding war may come to regret having paid a bit too much. But, that regret may not come for some time later when it's realized that's what happened. The real winner of any bidding war is the seller.
DanJones
DanJones
4/27/2017 | 12:04:03 PM
Re: Alt headline: Bidding War for Straight Path
Yeah they also added 28GHz with the XO buy.
nashafi949
nashafi949
4/26/2017 | 8:48:18 PM
Re: Alt headline: Bidding War for Straight Path
Straight path has 28 GHz in NY and SF . These are the main 2 cities where Verizon has most poles secured for deployment. Unless CO had a reasonable chunk of 28 in these cities otherwise it makes sense to go after straight path for Verizon. This has dual benefits .
DanJones
DanJones
4/26/2017 | 12:29:23 PM
One other thought...
What if the operator was SoftBank, not Verizon?
DanJones
DanJones
4/25/2017 | 5:32:47 PM
Re: Alt headline: Bidding War for Straight Path
AFAIK Google is fairly focused on 3.5GHZ CBRS right now.
mhhf1ve
mhhf1ve
4/25/2017 | 4:18:08 PM
Re: Alt headline: Bidding War for Straight Path
Is this mysterious bid a figure related to Pi or Euler's number? Google said it was might try wireless instead of fiber... :P

Probably not Alphabet, but Google has been known to bid up prices just to make things more expensive for others.
DanJones
DanJones
4/25/2017 | 3:58:19 PM
Re: Alt headline: Bidding War for Straight Path
Arguably its a bidding war that Straight Path has been trying to instigate for a couple of years now themselves.
Joe Stanganelli
Joe Stanganelli
4/25/2017 | 3:52:47 PM
Re: Alt headline: Bidding War for Straight Path
One or more of the players could be trying to instigate a bidding war --  having no real intent to actually win, while driving the price up for their competitor.

In which case, what a clever move.
DanJones
DanJones
4/25/2017 | 12:47:13 PM
Re: Alt headline: Bidding War for Straight Path
The question then becomes when do the 5G auctions start? Cos AT&T and Sprint are pretty much locked out of getting mmWave spectrum til then. T-Mobile got some 28Ghz in cities when it bought MetroPCS.

 

There's nothing scheduled yet.
TV Monitor
TV Monitor
4/25/2017 | 12:02:28 PM
Re: Alt headline: Bidding War for Straight Path
I think AT&T should walk away.

39 Ghz block is not desirable for mmwave 5G service, at best you can do a hotspot type service with it, mobile service is not an option.

The reason 28 Ghz block is so valuable is that you can do mobile 5G as well as wireless cable. Can't do this with 39 Ghz blocks due to range issues.

Just improve on LTE network with MIMO and carrier aggregation and wait until 28 Ghz blocks open up.
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