As mobile phone companies Verizon and Sprint move closer to offering a 4G connection to their customers, AT&T seemed to be left in the dust until recently. AT&T announced today that the company has agreed to acquire spectrum licenses in the Lower 700 MHz frequency band from Qualcomm for $1.925 billion.
Qualcomm currently is using the Lower 700 MHz frequency band for their mobile television service, FLO TV. The business, FLO TV, and the network however are expected by Qualcomm to be shut down in March 2011, which will free up the frequency band for other uses.
The spectrum covers more than 300 million people nationwide with 12 MHz of the Lower 700 MHz D and E block spectrum covering 70 million people in New York, Boston, Philadelphia, Los Angele and San Francisco, and 6 MHz of the Lower 700 MHz D block spectrum covering more than 230 million people over the rest of the United States.
This acquisition will allow AT&T to make a stand in the 4G market by deploying the "spectrum as supplemental downlink, using carrier aggregation technology." The spectrum will start being deployed once compatible handsets and network equipment are constructed so that they may take advantage of the new technology.
Earlier this month, Verizon launched their 4G LTE technology covering 200 million people. 4G LTE, while faster than 3G still isn't true 4G according to the ITU-R definition of 4G. AT&T's entrance will also not be true 4G, but instead will fall into a similar category that Verizon and Sprint's 4G falls into. AT&T however, will be able to offer their technology to more than 300 million people nationwide, while Verizon only reaches 200 million people.
The transaction still has to go through regulatory approval before becoming official, but assuming all goes well, AT&T and Qualcomm will be closing the deal during the second half of 2011.