Verizon to sell 700 MHz spectrum in A and B blocks to try to gain AWS spectrum in cable deal

[JeffDTD]

This is kind of a break in the convo....but it irritates the stew out of me that the big two are poor mouthing about an approaching " spectrum crisis" but as soon as verizon scored this deal agreement, you hear of plans to increase mobile video/media options, more wired isp replacement, etc. Is it a "crunch" as much as it is a lack of expansion desires and capacity not exponentially matching?

[ericdabbs]

Interesting articles commenting on the proposed Verizon 700 MHz A&B block spectrum sale. I learned a few things about the 700 MHz A&B spectrum that Verizon holds.

 

For one thing, Verizon has mandated buildout requirements for the 700 MHz A&B blocks by mid 2013 to at least 35% of the licensed geographical regions. There are also rumors that the A block may have interference problems with TV broadcasters on channel 51 which complicate the chance of it being used for LTE service. Also since the 700 MHz C block that Verizon has nationwide is so unique in that the downlink and uplink frequencies are flipped, it would be very costly for Verizon to implement additional antennas and filters on its handsets to account for the 700 MHz A, B and C blocks for LTE. Verizon would have add a new chip to use the A&B blocks of which Verizon was not going to front the money up for it.

 

It seems like Verizon had zero intention of ever deploying 700 MHz in the A&B blocks which further confirms what the RCA has been saying that Verizon has been warehousing or hoarding "beachfront spectrum" from the competition. In addition the RCA believes that the sale of the 700 MHz A&B is NOT sufficient enough to approve the cable deal which leads me to believe that further divestitures are required or a denial by the FCC. In addition the National Association of Broadcasters (NAB) also confirms what they have been accusing Verizon of warehousing "beachfront" spectrum and even question if there is truly a spectrum crisis.

 

Bottom line is that Verizon's antics are up to no good and more of the reason why this deal should not be approved. I posted quotes from each article below that were relevant to confirm what I have learned.

 

Fiercewireless:

"Another issue that may complicate any sale is one that has bedeviled the A Block since the 2008 700 MHz auction: There remains concerns about interference from nearby TV broadcast stations. Further, as analysts at Stifel Nicolaus pointed out in a research note, Verizon's Lower A and B Block licenses have buildout requirements that mandate coverage to 35 percent of the licensed geographic areas by mid-2013, which could be one reason why Verizon has chosen to sell it now. However, those requirements also put pressure on any carrier that bids for the spectrum. Farrar said Verizon had no intention of deploying its Lower A and B Block spectrum, and with the buildout deadlines approaching, "they're using this to their advantage."

 

http://www.fiercewir...trum/2012-04-18

 

CNET:

" Who will want Verizon's 700MHz spectrum?

 

Still, a closer look at the spectrum Verizon is proposing to sell reveals that the A and B block spectrum isn't likely to be of much use to many other carriers either.

 

Kevin Smithen, an analyst at Macquarie Capital, said in a research note that due to potential interference issues in the neighboring broadcast TV channel 51, the A block in the 700MHz band will likely only receive "minimal interest from bidders with immediate LTE spectrum needs."

 

http://news.cnet.com...able-after-all/

 

ComputerWorld

"Verizon billed the proposed sale as an effort to "rationalize" its spectrum holdings, but representatives of television broadcasters and small carriers were quick to accuse the nation's largest carrier of hoarding spectrum while at the same time lobbying federal authorities to make more of the airwaves available under the pretense of scarcity.

 

"Today's proposal by Verizon to sell reallocated broadcast TV spectrum involves airwaves in the largest urban markets in America that it purchased more than four years ago," Dennis Wharton, executive vice president of communications for the National Association of Broadcasters, said in a statement. "The fact that it has warehoused this 'beachfront property' raises the fundamental question of whether a spectrum shortage actually exists."

 

The Rural Cellular Association, a trade group, also weighed in with concerns about Verizon's proposed sell-off, echoing both the broadcasters' accusation of spectrum hoarding and the advocacy groups' warning about the anti-competitive implications of the cable deal.

 

"This announcement confirms what RCA has said: Verizon has developed a spectrum warehouse exceeding its needs," RCA President and CEO Steven Berry said in a statement."

 

"Selling its Lower 700 MHz A and B block licenses is not sufficient to resolve competitive concerns in the industry," Berry added. "Further, Verizon's announcement increases RCA's concerns with the pending cable transactions, including access to usable, LTE-ready spectrum and access to commercially reasonable roaming and backhaul arrangements. These deals require strict scrutiny, enforceable conditions helping to restore the competitive marketplace, and divestiture in markets where the transfers are not in the public interest."

 

http://news.idg.no/c...3A5D715A0715F99

[WiWavelength]

For one thing, Verizon has mandated buildout requirements for the 700 MHz A&B blocks by mid 2013 to at least 35% of the licensed geographical regions.

 

Good point, Eric. I had forgotten that the Lower 700 MHz A/B license four year construction requirement deadlines generally come up next year. And, unlike PCS 1900 MHz and AWS 2100+1700 MHz, which have population based construction requirements, Lower 700 MHz, like Cellular 850 MHz, has geographic area based construction requirements: 35 percent within four years (typically, 2013) and 70 percent by the end of the license term (typically, 2019).

 

There are also rumors that the A block may have interference problems with TV broadcasters on channel 51 which complicate the chance of it being used for LTE service.

 

AT&T claims that FCC rules "prohibit" Lower 700 MHz A block uplink operation inside DT channel 51 broadcast contours.

 

 

http://attpublicpolicy.com/wireless/no-mhz-left-behind/

 

AJ