AT&T has been struggling to expand its 4G LTE network, and today reports say the company is dropping $1.9 billion in order to do so. The chunk of cash will buy unused spectrum from its biggest competitor, Verizon.
The deal between the two companies will see upgraded service for 42 million users across 18 States. The unused spectrum consists of 39, 700MHz B block wireless licenses and will further support AT&T's plan to offer 4G LTE to as much as 270 million users by the year's end. It took around 8 months for the two carriers to reach an agreement.
In return, Verizon has some benefits coming its way as well. AT&T will hand over advanced wireless spectrum licenses to Verizon in five different markets including Phoenix, Los Angeles, Fresno, Albuquerque and Portland. Verizon expects the licenses to be worth as much as $225 million.
Not only does this deal make sense for both Verizon and AT&T, but according to the FCC, this is a good deal for everyone. Mignon Clyburn, the acting FCC chairwoman said, "This is a big win for consumers, especially in rural areas, who will see more competition and more choices. Also, by making it easier for small wireless carriers to compete, today's interoperability solution will spur private investment, job creation, and the development of innovative new services and devices."
AT&T says it will substantially complete is 4G LTE network by this time next year. The new licenses will affect consumers in California, Colorado, Florida, New York, Virginia and Washington to name a few.
(Image via Mosaik)