T-Mobile to purchase spectrum from Verizon

07 January 2014 | Sophie Donoghue


T-Mobile US has announced a deal to purchase unused 700MHz radio-frequency spectrum licences from rival Verizon Wireless.

The deal which is worth $3.3 billion includes $2.4 billion in cash and a transfer of spectrum worth $950 million to Verizon. The spectrum Verizon is receiving is in heavily populated areas.

The Deutsche Telekom majority owned company hopes the deal will improve the quality of its LTE services in an effort to compete with market leaders AT&T and Verizon. "This is a great opportunity to secure low-band spectrum in many of the top markets in America," said T-Mobile US CEO John Legere.

The licences cover over 150 million people in New York, Atlanta and Los Angeles, T-Mobile said. Low-band spectrum travels furthest and will increase the operator’s coverage.

T-Mobile expects the deal to close in the middle of 2014 and will roll out services using the spectrum by the end of this year.

News of the deal follows the announcement that Verizon has partnered with T-Mobile to exchange airwaves throughout the US.