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April 25, 2012

FCC Gives Nod to AT&T Transfer of Spectrum to T-Mobile

By Steve Anderson, Contributing TMCnet Writer

Recently, battles about spectrum in the wireless space have been cropping up, with the FCC (News - Alert) placing careful attention to ensure that no one company is getting too much and thus forcing other companies out of the market. However, a recent transfer from number two ranked AT&T to number four ranked T-Mobile (News - Alert) has passed FCC muster with little incident.



AT&T (News - Alert) handed over the airwaves to T-Mobile following a failed merger attempt staged last year, which required AT&T to not only provide a substantial block of wireless transmission space but also $3 billion in cash. The merger move came under fire from regulators, concerned that number two and number four getting together would make not only a new number one over competitor Verizon (News - Alert), but also too concentrated a force in the market in general.

T-Mobile, for its part, means to use the newly-acquired spectrum to augment its own network, helping to provide better and higher-speed data services, and plans to use the cash in much the same way. In fact, they've gone sufficiently far as to commit to spending $4 billion—a bit more than they got from AT&T in cash—on network improvements and new technology to start emerging in 2013.

T-Mobile needs more of a competitive advantage, plain and simple, to assure it even holds its place as the fourth-ranked carrier in the United States. With AT&T and Verizon's reach as wide as it is, and Sprint (News - Alert) offering a key competitive advantage in the form of its combination of iPhone and unlimited data access, T-Mobile will need some advantages of its own to keep up.

With T-Mobile currently advertising on the basis of its network speeds, with some effect, it will have at least some short-term benefit, but will need to keep building to capitalize on that offering. And terrific network speed alone may not be enough if the caps are too low; users will look at the great speeds and say with the practiced eye-roll of jaded consumers everywhere, “Great, just let me slam into my cap faster.”

Still, T-Mobile's efforts are a great start and should hopefully help the company gain a competitive edge against the various other firms comprising the market space.




Edited by Jamie Epstein
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