How AT&T and Verizon bet on the wrong spectrum to build out their 5G networks a few years ago
T-Mobile’s 5G layer cake which helped it take the early 4G lead in the States. | Image credit-T-Mobile
Meanwhile, T-Mobile had a different idea. Using the 2.5GHz mid-band spectrum it picked up from Sprint in the $26 billion acquisition of its rival, T-Mobile proved that using mid-band was the way to build a 5G network in the U.S. Not as fast as mmWave, mid-band is still faster than low-band. While mid-band signals don’t travel as far as low-band, they do travel longer distances than mmWave. T-Mobile rode its Goldilocks mid-band spectrum to become the early 5G leader in the U.S., a position it still has to this day.
“Unlike legacy spectrum below 2.5GHz, mid-band spectrum is neither encumbered by legacy technologies nor broken up into narrow, paired slivers incapable of supporting high-speed 5G applications. Unlike millimeter wave spectrum, mid-band spectrum is capable of supporting wide-area networks covering urban and suburban neighborhoods.
–AT&T
AT&T should have enough money to buy more 3.45GHz spectrum
If New Street’s forecast of AT&T‘s cash is correct, the $7 billion would give AT&T enough juice to buy the 3.45GHz spectrum that T-Mobile sold Columbia Capital last September, and some AWS-3 licenses that AT&T is expected to buy. However, it should be pointed out that if AT&T plans on buying Columbia Capital’s 3.45GHz holdings, it will have to sell part of Lumen’s fiber business to an equity partner. Such a move was already baked into the AT&T-Lumen deal.
Back in March, AT&T requested a waiver from the FCC allowing it to exceed the regulatory agency’s limit of 40MHz of 3.45GHz spectrum that a carrier can control. The 40MHz limit expires next January 4th. But because its acquisition of 3.45 GHz spectrum holdings from UScellular would put AT&T over the FCC limit in some markets, AT&T asked for this waiver which has yet to be granted. If the waiver is not approved, AT&T might have to scrap or revise its plan to obtain more 3.45GHz spectrum.
In a recent filing made with the FCC, AT&T disclosed its 3.45GHz holdings and wrote, “Verizon and T-Mobile hold the majority of the remaining unpaired mid-band spectrum outside the 3.45GHz band. As things currently stand, AT&T‘s most realistic catch-up opportunities lie in the 3.45GHz spectrum band. Given the lack of a clear spectrum pipeline or mid-band spectrum auction on the horizon, the secondary market represents the only opportunity for AT&T to catch up in the near- to mid-term.”
