T-Mobile strikes $3.3B deal with Comcast to expand spectrum holdings

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T-Mobile is bolstering its spectrum portfolio by acquiring airwaves from Comcast in a transaction valued at up to $3.3 billion.

The agreement was unveiled in a blog post on Comcast’s website, where the company cited a reduced need for the 600MHz spectrum as the primary motivation behind this strategic move.

Comcast had initially announced its intentions to employ the 600MHz spectrum in the development of a 5G network to enhance its Xfinity Mobile service. Alongside this, the company also tapped into the Citizens Broadband Radio Service (CBRS), an unlicensed spectrum in the 3.5GHz range, which was available for free usage. However, Comcast’s recent experiences with CBRS spectrum have led to a change of plans.

According to Comcast’s statement, the results from 5G field tests utilising CBRS spectrum exceeded expectations—positioning it as a highly efficient component of a 5G network. 

“Our 5G network field tests with CBRS spectrum have exceeded our expectations and we’ve found the band to be highly efficient and a significant part of a 5G network,” wrote Tom Nagel, SVP of Strategy & Development for Wireless at Comcast.

“This strong CBRS spectrum performance has made us realise that we are unlikely to need the 600MHz spectrum licenses that we currently hold to support our wireless customers.”

Consequently, Comcast determined that its 600MHz spectrum was surplus to its requirements—leading to the decision to lease it to T-Mobile.

Under the terms of the deal, T-Mobile will commence with quarterly lease payments that culminate in a final payment of approximately $3.3 billion for the acquisition of the spectrum license.

A filing with the Securities and Exchange Commission further confirmed T-Mobile’s intentions, noting that the transaction’s completion is contingent upon approval from the Federal Communications Commission and is expected to be finalised by 2028.

Comcast has retained the option to reclaim a portion of the 600MHz airwaves in the future if the need arises. This caveat reflects the ever-evolving landscape of the telecommunications industry, where spectrum resources are highly sought after and subject to dynamic shifts in demand.

T-Mobile’s history with the 600MHz spectrum dates back to 2019 when it initially launched its low-band 600MHz 5G network, covering extensive areas across the US. This spectrum acquisition will be pivotal for T-Mobile as it seeks to expand its 5G network reach, particularly in major metropolitan areas.

As the telecoms sector continues to evolve and adapt to the demands of a rapidly advancing digital age, strategic moves like this one will shape the competitive landscape and determine the quality of services offered to consumers.

(Photo by Cytonn Photography on Unsplash)

See also: Ofcom: Over half of UK can access full-fibre, mobile coverage steady

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