IHS Global Insight Perspective | |
Significance | AT&T has acquired additional spectrum in the 700-MHz band. |
Implications | The deployment of Long-Term Evolution (LTE) in this spectrum will utilise carrier-aggregation technology, which is also being developed by Nokia Siemens Networks (NSN) for HSPA Evolution. |
Outlook | IHS Global Insight expects to see further spectrum deals involving the likes of Clearwire and T-Mobile U.S.A., among others. |
AT&T has announced that it has agreed to acquire spectral licences in the lower 700-MHz band from Qualcomm for US$1.925 billion. The licences:
- collectively cover a population of over 300 million people nationwide
- include 12-MHz of lower 700-MHz D and E block spectrum covering 70 million people in the top 15 U.S. metro area in New York, Boston, Philadelphia, Los Angeles and San Francisco
- include 6-MHz of lower 700-MHz spectrum covering 230 million people across the rest of the United States.
In a press release, AT&T said that it would deploy this spectrum as a supplemental downlink using carrier-aggregation technology, which is set to be enabled with the completion of 3GPP Release 10. The carrier added that it would begin using this spectrum once supporting handsets and network infrastructure are available. The deal is subject to regulatory approval and is expected to be completed in the first half of 2011.
Outlook and Implications
- Qualcomm to Focus on Chipset Roadmap: Qualcomm had announced in October that it was ending sales of its mobile TV service, Flo TV, which had utilised its 700-MHz holdings (see United States: 6 October 2010: Qualcomm Ends Flo TV). The vendor has also said that it will divest its broadband wireless spectrum in India (see India: 27 October 2010: Qualcomm Plans to Sell Indian BWA Licences).
The divestment of the spectrum is likely to end its retail ambitions to focus on the development of new mobile broadband technologies, including carrier-aggregation technology, which will help operators to use unpaired spectrum in conjunction with paired spectrum for mobile broadband. The vendor said that it was integrating this technology into its chipset roadmap and has also talked about acquisitions to strengthen its product portfolio (see World – United States: 04 November 2010: Qualcomm Talks Up Acquisitions). Intel, which recently boosted its wireless chipset presence through the acquisition of the wireless business of Infineon Technologies, is another vendor divesting spectral assets (see World: 31 August 2010: Intel to Acquire Wireless Unit of Infineon Technologies for US$1.4 Bil. and Sweden: 16 December 2010: 3 Sweden Looks to Acquire Intel Spectrum for LTE Roll-Out). - Hunt for Spectrum: AT&T’s acquisition of Qualcomm’s 700-MHz holdings is only one of several potential deals. LightSquared will enable wholesale Long-Term Evolution (LTE) access, while T-Mobile, MetroPCS and Clearwire are all likely to be involved in deals over the next few years (see United States: 20 July 2010: LightSquared to Launch LTE Network in Several U.S. Cities During H2 2011). While Clearwire may decide to sell spectrum to reduce its debt load, the likes of T-Mobile and MetroPCS are looking to acquire additional frequencies to help them deploy mobile broadband further.
The fragmentation of LTE-ready spectrum across several bands and in paired and unpaired availability will mean that vendors and operators will need to find new ways to utilising this spectrum commercially. Only recently, NSN announced the development of long-term HSPA evolution, incorporating HSDPA carrier aggregation, which enables carriers from more than one frequency band to be combined.