T-Mobile Could Score Big as Sprint Bows Out of 600 MHz Spectrum Auction

by Istvan Fekete on September 29, 2015

Sprint has just announced it won’t participate in next year’s 600 MHz incentive auction, which places T-Mobile on a winning field, since it will have to outbid fewer competitors in the race for the 30 MHz of spectrum set aside for smaller carriers by the FCC.

On Friday evening Spring announced that “after thorough analysis” it would not bid in next year’s 600 MHz action scheduled for March 29. The carrier found that it has sufficient spectrum holdings to provide its current and future customers great coverage and reliable services.

While T-Mobile urged the FCC to increase the set-aside spectrum to 40 MHz, the agency declined to do so. Now that Sprint is out of the race, T-Mobile remains the only major nationwide carrier that can bid on the FCC’s 30 MHz reserve.

“For TMUS we see this as a very positive development,” said the analysts at Wells Fargo in a research note to investors today in response to Sprint’s announcement that it would not participate in the auction. “As long as there is enough spectrum from the broadcasters, it [T-Mobile] should face a lot less competition in the fight for the 30MHz (megahertz) of reserve spectrum.”

That won’t prevent other players such as US Cellular or C Spire Wireless bidding on the set-aside spectrum, but as their funds are limited, it would be hard for them to outbid T-Mobile, the carrier that had the financial resources and guts to start an avalanche of changes in the US wireless industry.

There is a catch though: The FCC’s rules will prevent T-Mobile from acquiring all of the set-aside spectrum. The agency has high hopes that other players will join the auction and possibly raise the price of the licences.

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Written by: Istvan Fekete. www.digitcom.ca. Follow TheTelecomBlog.com by: RSS, Twitter, Facebook, or YouTube.

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