"A carrier does not just wake up one day and decide to sell some of the best spectrum it has at a time when it argues the industry is facing a spectrum crunch," he writes. Importantly, he adds, this could mark the start of a new national policy that applies spectrum caps on Verizon Wireless, AT&T Inc. (NYSE: T) and other wireless carriers.
Moffett estimates that Verizon's "weighted average spectrum depth on a national basis" would be roughly 107MHz, but fall just below the 100MHz ceiling if it were to sell its A and B blocks.
Update: Here's a graph from the research firm comparing the spectrum holdings of top U.S. carriers.
Here's how Moffett sizes up the winners and losers if Verizon Wireless is allowed to proceed.
Verizon: Because it gets quick access to vacant AWS spectrum while boosting its net spectrum holdings and its lead on AT&T, Sprint and T-Mobile.
The cable guys: They can clear this deal from the decks faster than expected and let Comcast and TW Cable accelerate the rate of their share repurchase programs while preserving their net debt ratio commitments.
T-Mobile: Moffett sees them as the most likely buyer of any AWS spectrum that Verizon is required to shed, noting that it could involve markets like New York where T-Mobile is spectrum-poor. He also sees MetroPCS Inc. (NYSE: PCS) and Leap picking up some AWS "scraps that suit their needs."
Sprint and Clearwire: Moffett says Sprint can't afford to buy any spectrum, and that a potential tie-up with T-Mobile becomes less likely if T-Mobile is able to purchase some. The availability of new spectrum will also reduce Clearwire LLC (Nasdaq: CLWR)'s ability to get top dollar for its lower quality 2.5GHz holdings.
Dish: If a spectrum cap in the neighborhood of 100MHz is imposed, any hopes of a quick sale of Dish's 40MHz of S-band spectrum to AT&T could be dashed, as AT&T currently holds 87.7MHz of spectrum on average, post the T-Mobile breakup. Moffett also isn't confident that Dish will be able to sell part of its holdings to AT&T because the satellite TV giant would still be on the hook to build a wireless network, which could scare investors. (See FCC Keeps Dish Spectrum Plan Alive .)