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(UPDATED) Sprint-USCC spectrum deal: Sprint gets 20 MHz broader in the "City of Broad Shoulders"

Posted by WiWavelength, in Author: Andrew J. Shepherd 07 November 2012 · 20,202 views

Sprint USCC Chicago St. Louis spectrum
(UPDATED) Sprint-USCC spectrum deal: Sprint gets 20 MHz broader in the "City of Broad Shoulders" by Andrew J. Shepherd
Sprint 4G Rollout Updates

Thursday, November 8, 2012 - 1:10 PM MST


Update:  Six weeks later, Sprint and U.S. Cellular have finally filed their PCS 1900 MHz license assignment applications in the FCC ULS database.  From the filing, we have learned that USCC will not relinquish all of its PCS spectrum in Springfield and Champaign, so the primary market spectrum table below has been updated to reflect that clarification.  In a nutshell, Sprint will acquire a consistent PCS B block 20 MHz partition and disaggregation in all affected counties in the Chicago MTA and a consistent PCS A block 10 MHz partition and disaggregation in all affected counties in the St. Louis MTA.  For a complete list of the counties included in the spectrum transaction, see this spreadsheet from the FCC filing.

Yesterday, Sprint and U.S. Cellular announced an agreement to transfer PCS 1900 MHz spectrum and subscribers in several midwestern markets -- notably, Chicago, St. Louis, Ft. Wayne, South Bend, Springfield (IL), and Champaign -- from USCC to Sprint.  While this transaction does entail that USCC will exit its largest and home market, Chicago, it is not a merger.  Overall, USCC will give up 585,000 subs but will retain over 5 million current subs, and the deal involves no transfer of wireless infrastructure.  Rather, the existing USCC CDMA2000 infrastructure in the affected markets will be retired within approximately two years, as subs are transitioned to the Sprint network.  The exact boundaries of the PCS licenses and subs to be transferred from USCC to Sprint have not yet been revealed on a county by county basis.  So, this article will be updated once the FCC assignment applications are filed or any other further info arises.

In the meantime, know that this is a spectrum transaction, bar none.  Chicago is Sprint's largest market in which it holds only 20 MHz of PCS A-F block spectrum.  In nearly all other top 10 markets, Sprint holds 30 MHz of PCS A-F block spectrum.  And Ft. Wayne is a proverbial red headed stepchild market -- Sprint's only top 100 market with only 10 MHz of PCS A-F block spectrum.  So, most importantly, this transaction provides a 20 MHz PCS injection into Sprint's spectrum holdings in both Chicago and Ft. Wayne.  For a look at the five largest markets included in the deal, see the spectrum table below:

Posted Image

Moreover, Sprint's existing PCS D block 10 MHz and PCS E block 10 MHz licenses in Chicago are non adjacent.  As such, Sprint has to run an extra set of guard bands -- one set of guard bands for each license.  Those extra guard bands take up valuable spectrum, limiting Sprint to only six instead of seven CDMA2000 carriers in its 20 MHz of spectrum and leaving more sites in Chicago spectrum constrained than in any other big market.  Synergistically, though, the PCS B block 20 MHz license that Sprint will acquire in Chicago is directly adjacent to its existing PCS D block 10 MHz license, giving Sprint a fully 30 MHz contiguous swath of PCS spectrum, which will allow Sprint to deploy additional CDMA2000 carriers and larger LTE bandwidth (10-15 MHz FDD) when the time comes to add LTE capacity.  See the license contiguity in the band plan diagram below:

Posted Image

Speaking of LTE, that is one of the key reasons why USCC is willing to part with its Chicago market.  In most of its markets, USCC holds some combination of Cellular 850 MHz, PCS 1900 MHz, AWS 2100+1700 MHz, and Lower 700 MHz spectrum.  But in Chicago, USCC controls only the aforementioned 20 MHz block of PCS spectrum.  USCC entered the Chicago market just 10 years ago when it acquired PrimeCo, which had been divested as part of the merger that created Verizon Wireless.  Since then, USCC has been unable to acquire additional spectrum in Chicago, leaving it effectively incapable of deploying LTE in its largest market while continuing its CDMA2000 operations.  So, the deal with Sprint provides an exit strategy for Chicago in what was otherwise a dead end market for USCC.

In the other five of the six markets detailed above, USCC likely could roll out LTE, as it holds additional AWS 2100+1700 MHz and/or Lower 700 MHz licenses in those markets.  It should be noted, however, that those non PCS licenses are not being transferred to Sprint in this deal.  But as it exits those markets, USCC will almost surely look to sell the other licenses, too, with VZW and T-Mobile being likely buyers for the AWS spectrum, AT&T a strong possibility for some of the 700 MHz spectrum.

Sources: FCC, USCC, Sprint




Nice post AJ. I definitely wanted to know what some possibilities were for Sprint with the increase in spectrum. I don't live in any of those markets but I'm still bummed that its gonna take upwards of 2 years for them to take advantage of that additional spectrum.
Nice write up AJ. I can disagree with you in some other threads, but still find your insight valuable and a huge reason I continue to visit this site.
AJ, your articles are always clear, to the point, well written, and, not to mention, they add so much to S4GRU. Thank You.
Great Post AJ. I have a few question regarding the spectrum. You said Sprint will get 30 MHz contiguous swath of PCS spectrum with the purchase from USCC in Chicago. How about the other Midwest markets? Will it be contiguous too? How will this effect LTE deployments in these specific Midwest markets compared to around East Coast and West Coast markets? Will any future handsets need to have extra / different chipsets to accomodate the new spectrum to take advantage of this spectrum assuming that these spectrum will be available to sprint customers and will be limited to these Mid west markets?

Nice post AJ. I definitely wanted to know what some possibilities were for Sprint with the increase in spectrum. I don't live in any of those markets but I'm still bummed that its gonna take upwards of 2 years for them to take advantage of that additional spectrum.


I don't really think its that big of a deal. S4GRU has mentioned that it will take at least a couple years before Sprint's Network Vision hits capacity in most markets, so the timing will workout great!
Great job.

Do the phones shipping today that are LTE have a radio that will work with the added spectrum?

Great job.Do the phones shipping today that are LTE have a radio that will work with the added spectrum?


PCS is PCS. No new radios will be required to use the USCC spectrum.

Great Post AJ. I have a few question regarding the spectrum. You said Sprint will get 30 MHz contiguous swath of PCS spectrum with the purchase from USCC in Chicago. How about the other Midwest markets? Will it be contiguous too? How will this effect LTE deployments in these specific Midwest markets compared to around East Coast and West Coast markets? Will any future handsets need to have extra / different chipsets to accomodate the new spectrum to take advantage of this spectrum assuming that these spectrum will be available to sprint customers and will be limited to these Mid west markets?


USCC is selling Sprint PCS spectrum. Sprint's LTE phones (all of them) already support LTE in PCS blocks A-G, and the USCC spectrum all falls in that area. So no one will have to swap out equipment etc. to take advantage of the new capacity (and that's all that this is...no coverage will be added as a result of the purchase) that will be available in the above markets.

PCS is PCS. No new radios will be required to use the USCC spectrum.


Thanks i Just now found the answer and was going to edit my post
It was in the wall post a while back about the note 2 (my phone)

I think its a typical phone.
  • CDMA1X + EV-DO band classes 0, 1, 10 (i.e. CDMA1X + EV-DO 850/1900/800)
  • LTE band 25 (i.e. LTE 1900; PCS A-G blocks)
  • LTE 5 MHz FDD carrier bandwidth
An interesting aside: when USCC bought PrimeCo's Chicago assets from a private equity firm in 2002, USCC paid $610 million. Now, Sprint is buying effectively all of that and more for $480 million. Missing from this deal, of course, is any network infrastructure, but Sprint does not need a redundant network. In the end, entering its home market looks to have been a bad financial proposition for USCC.

AJ

PCS is PCS. No new radios will be required to use the USCC spectrum.


Yep, this is ordinary, everyday PCS 1900 MHz A-F block spectrum -- the very same kind of spectrum that Sprint has been using for the past 15 years.

AJ
Hi Andrew...even before the spectrum gets transferred, will USC and Sprint open up their 1xRTT and EvDO networks to all subscribers? I noticed that my phone was roaming yesterday on USC, something that doesn't ever happen unless I'm underground on the train, even though I was in an area where Sprint certainly has coverage. I can't imagine that Sprint would pay any further roaming fees to USC after the deal closes, so would they make software changes so that all USC towers appear to be SprintCom so that Sprint phones do not report roaming? I updated my PRL yesterday also, and it jumped ahead 2 versions...kind of unusual. I certainly wouldn't mind some more EvDO capacity...
Is there any sort of roaming agrement between USCC and Sprint? Will USCC customers from areas other then the several midwestern markets sold be able to roam on sprints network in the markets sold? Not really sure if that makes complete sense.

Hi Andrew...even before the spectrum gets transferred, will USC and Sprint open up their 1xRTT and EvDO networks to all subscribers?


Is there any sort of roaming agrement between USCC and Sprint?


Sprint and USCC already have a reciprocal roaming agreement. I know that Sprint PRLs typically place USCC SIDs higher than VZW SIDs in priority. And I believe that USCC does likewise. So, for at least Sprint subs, they can already roam in most, if not all USCC markets in the country. That roaming behavior is not apt to change at all, since 1) USCC is already at high priority and 2) Sprint is not absorbing the USCC network in the affected markets.

AJ

I certainly wouldn't mind some more EvDO capacity...


In Chicago, Ft. Wayne, South Bend, Springfield, and Champaign, where Sprint's PCS D block 10 MHz license is directly adjacent to USCC's PCS B block 20 MHz license as I detail in the article, Sprint and USCC may very soon be able to drop the guard bands between their two respective licenses, freeing up a conditional CDMA2000 carrier channel assignment -- PCS 0400 -- which could be used to provide additional EV-DO capacity, for example.

AJ
Another couple of interesting factoids: assuming that this spectrum transfer goes through unimpeded, Chicago will go from being Sprint's most spectrum challenged top 10 market to Sprint's most spectrum rich top 10 market. And Champaign will become Sprint's most spectrum rich market in the entire country.

AJ
As somebody who lives in the Chicago area.

YAY!
Now sprint just needs to keep on the hunt for Nationwide pcs spectrum

Now sprint just needs to keep on the hunt for Nationwide pcs spectrum


What do you mean by that? The only carrier with a completely consistent, unbroken swath of PCS 1900 MHz spectrum is already Sprint with its PCS G block 10 MHz licenses. Even if Sprint were to acquire T-Mobile, it would not gain anymore fully "nationwide" PCS spectrum.

AJ
I think Exline may be speaking of the H-block that may or may not ever come up.

I tend to have a different take, though, on strategy. AT&T and Verizon have effectively played "small ball" scooping up as much capacity as they can, wherever they can. Sprint likes its continuity, like G block, H block, SMR. It simplifies, but I'd posit this, if it's even possible, that Sprint could start playing more small ball (like this deal & possibly even a full USCC merger), and then use the 700mhz and AWS assets to bargain with AT&T and Verizon. They may not want them now, but their value will only appreciate and the "bandwidth crunch" continues. Then, maybe in places where one of the other two Telcos has adjacent bandwidth Sprint could use, Sprint could swap, say, 20mhz of 700, for 25 or 30mhz in 1900? Or some 1700 even swap for 1900? (I'm not as well versed at who owns what, but with all the permutations and geographic limits, there's got to be some good horse-trading out there for all parties).

Also, is it possible for some of the 850 that others own to run with the new 800SMR, so that could be an even swap? It's adjacent, but I'm not sure about the rules for co-mingling those different band types.

I guess the more expensive option, is just to play for keeps, and not swap at all with other Telcos. Maybe sell and swap with other big stakeholders like cable cos?

Personally, I like the idea of buying a sliver of property with a big fence smack dab between Boardwalk and Park Place.
Right Now Sprint uses 5 Mhz Bandwidth for LTE which results in maximum of 25 mpbs Download speeds(Averaged). Having 10- 15 Mhz BW will gift the users with ~50-75 Mbps DL throughputs as Sprint LTE uses 5*5 MIMO .
Chaitu, probably not in the short term. If they need more LTE bandwidth they will likely add another 5x5. Unless your phone uses carrier aggregation, the speeds will stay around 25 at good signal.

...as Sprint LTE uses 5*5 MIMO .


You will have to clarify what you mean by the above. Sprint certainly is deploying LTE initially in a 5 MHz FDD (i.e. 5 MHz x 5 MHz) configuration. As for MIMO, only 2x2 downlink MIMO is supported currently. And that is not likely to change anytime soon, since very few devices will support 4x4 downlink MIMO. Most current devices are challenged enough just to implement two Rx antennas across multiple LTE bands.

AJ

Also, is it possible for some of the 850 that others own to run with the new 800SMR, so that could be an even swap? It's adjacent, but I'm not sure about the rules for co-mingling those different band types.


Maybe, but not likely.

Device compatibility would not be a problem. Sprint CDMA2000 devices have supported CDMA1X 850 roaming for better than 10 years. And when they are released next year, Sprint LTE 800 devices will adhere to band 26 standards -- meaning they will support a superset of both the SMR 800 MHz and Cellular 850 MHz bands.

But to my knowledge, no Cellular 850 MHz license has ever been disaggregated. So, Sprint would have to acquire entire 25 MHz licenses. And almost all of those that would be valuable to Sprint are in the hands of VZW and AT&T. But the Twin Bells are not going to part with the Cellular 850 MHz spectrum that has given them such anti competitive advantage.

In fact, the largest and only top 25 market in which VZW and AT&T do not hold both Cellular 850 MHz licenses is Milwaukee, where US Cellular holds the Cellular A-side license. Moreover, out of all top 100 markets, take a guess at how many Cellular 850 MHz licenses out of 200 total are not in the hands of VZW nor AT&T?

AJ
A good question is how many towers are owned by USCC and how many are they renting space on? That may explain the lack of interest in the USCC equipment. If USCC is renting space then they have little to offer. The two year timetable also makes it possible for Sprint to deploy NV gear on some of those towers. They have a severe lack of coverage in many of the more rural areas that are involved in the deal. If they plan on adding NV equipment on the rented towers...that just increased Samsung's load in Central IL.