In an effort to meet the growing demand for spectrum it looks like AT&T has plunged back into the acquisition pool, announcing its plans to purchase NextWave Wireless and its spectrum holdings. Following the colossal failure of AT&T’s attempted takeover of T-Mobile late last year, you knew America’s second largest wireless carrier simply wouldn’t (perhaps couldn’t) stand pat in the spectrum race, given that Verizon has been working on its own controversial spectrum acquisition plans as well.
Further, given the proliferation of data hungry devices spectrum has quickly become one of the world’s hottest commodities, leading companies like AT&T to do whatever it takes to secure more bandwidth to satiate the demands of a data hungry public.
But like its failed T-Mobile acquisition, a deal that instantly met with vehement backlash from both the public and private sectors, AT&T has once again taken the hard road towards securing more spectrum, as the bandwidth NextWave has licences for is not approved for mobile data usage.
If the agreement meets FCC approval AT&T will get its hands on NextWave’s Wireless Communication Services (WCS) and Advanced Wireless Services (AWS) bands, valuable spectrum that AT&T will undoubtedly employ to help grow the latter’s 4G LTE network, an area it now finds itself falling behind in.
While on the face of it the deal seems rather innocuous, particularly when compared to the monumental multi-billion dollar status of the previous T-Mobile proposal, this NextWave acquisition is not without its own pitfalls, chief of which is that under current FCC rules the WCS bandwidth frequency cannot be used for mobile Internet service.
As I’ve written at length before, one key issue in the ongoing spectrum crisis is that all the bandwidth currently earmarked for mobile Internet has long been consumed, meaning that in order to find more spectrum to increase mobile network coverage companies have to go looking for bands earmarked for other things. In regards to the WCS bandwidth, the FCC has rules in place blocking its usage for mobile Internet because of potential interference with satellite radio.
In an effort to combat the current FCC regulations, AT&T has brought satellite radio provider Sirius on board to help assuage concerns, the two companies filing a joint proposal to the FCC that would ensure protection for satellite users yet still unlock the bandwidth for mobile Internet use.
“There is a massive shortage of spectrum, making any that is available very valuable,”Rob Enderle, principal analyst at Enderle Group explains. “This band is very close to that used by GPS, and the technology NextWave used wasn’t adequate to address the problem of interference. However, this is a technology problem, and if it was impossible to fix, the FCC wouldn’t have let NextWave try in the first place. AT&T feels they can fix this.”
With practically the entire gamut of ‘beachfront’ spectrum long spoken for, look for these sorts of acquisition proposals to increase, as companies like AT&T search every nook and cranny in search for ways of bolstering their struggling wireless networks. Although of course it doesn’t take Nostradamus to predict that the current spectrum issues will still be alive and well once all the secondary spectrum is consumed, but that’s for another time.