Thursday, January 20, 2022

No Sustainable Advantage Tends to Exist in Mobile Business

Virtually nothing in the connectivity and computing businesses remains unchanged for long, especially touted marketing advantages. Consider mid-band spectrum resources available to the leading U.S. mobile providers and one major challenger. 


By virtue of its acquisition of Sprint, T-Mobile amassed a trove of about 160 MHz of mid-band spectrum, mostly at 2.5 GHz. At a clear disadvantage, AT&T and Verizon both spent heavily to acquire new mid-band spectrum. 


The C-Band spectrum auctions generated $81 billion as the carriers bid to acquire 280 MHz of spectrum in the 3.7 to 3.98 GHz region. 


Verizon won 60 MHz in the A Block that is being deployed early in 2022. Verizon also acquired 80 MHz to 140 MHz of the B Block that requires clearing of current users, something that is expected by late 2023. 


AT&T won about 100 MHz (40 MHz in the A Block and 60 MHz in the B Block. T-Mobile also won about 30 MHz in the B Block. 


The Federal Communications Commission Auction 110 released 100 MHz of national average spectrum in the 3.45 GHz to 3.55 GHz range.


The winners spent $22.5 billion on a total of 4,041 licenses. The average cost was $0.74 per MHz-PoP.


The top five bidders spent $21.3 billion, representing 95 percent of total spending. 


The spending by the top five bidders was:

  1. AT&T: $9.1 billion, or 40.5 percent

  2. DISH Network: $7.3 billion, or nearly 33 percent of the total

  3. T-Mobile: $2.9 billion, or 13 percent

  4. Columbia Capital: $1.4 billion, or six percent

  5. U.S. Cellular: $580 million or 2.6 percent  


Early in 2021 T-Mobile had a commanding lead in mid-band spectrum. After the latest auction, T-Mobile still has the most mid-band spectrum, in the 300-MHz range. But both Verizon and AT&T now have mid-band assets in the 200-MHz range. 

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