T-Mobile, Verizon Spectrum Trade Exposes LTE Market Shifts

Feb. 3, 2014
The U.S. is expected to lead the world in 4G LTE in 2014 following T-Mobile’s acquisition of low-band 700 MHz spectrum licenses from Verizon Wireless.
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Compared to the high-band sections of the mobile spectrum, the low band has the capability to improve in-building and rural coverage at greater distances. The Long Term Evolution (LTE) landscape is subsequently shifting and growing--especially after T-Mobile’s recent acquisition and swap of spectrum with Verizon Wireless. This and other factors have led Strategy Analytics to predict that LTE will account for 50% of wireless connections in the U.S. by the end of this year.

The "Worldwide Cellular User Forecasts, 2013-2018" report forecasts that the U.S. will lead the world in 4G LTE in 2014--accounting for more than one in three of the expected 528 million LTE connections. When combined with its existing holdings, T-Mobile’s purchase of select 700-MHz A-Block spectrum licenses position it as a leader in the market. T-Mobile will now have low-band spectrum coverage for approximately 158 million people in regions like New York, Los Angeles, Dallas, Houston, Philadelphia, Atlanta, Washington, D.C., and Detroit.

In exchange for those 700-MHz licenses, Verizon received a selection of advanced-wireless-service (AWS) and personal-communications-service (PCS) licenses. The additional airwaves provide coverage where the company has been struggling to relieve network congestion-- urban cities like Los Angeles, San Francisco, Dallas, Atlanta, and Detroit. As Verizon looks to build out its coverage, two-thirds of its traffic is now represented on the LTE network.

According to the article “T-Mobile Swap Gives Verizon Spectrum, $2.4 Billion in Cash” by Cornelius Rahn and Scott Moritz of, Verizon never put the A-Block airwaves to use because it built out its network with different frequencies. In addition, the company lacked the geographic coverage that would have made it worthwhile to use them. For T-Mobile, the licenses provide a means to meet increased capacity demands caused by the growing number of mobile devices.All network operators are currently figuring out ways to gain traction in the market. Sprint is currently working on building out its high-capacity coverage. Both AT&T and Verizon are looking toward expanding the functionality of LTE services including Voice over LTE (VoLTE) and sponsored mobile data. Internationally, Japan and South Korea offer burgeoning 4G markets while China has begun taking its first steps toward TD-LTE services.

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About the Author

Iliza Sokol | Associate Digital Editor

Iliza joined the Penton Media group in 2013 after graduating from the Fashion Institute of Technology with a BS in Advertising and Marketing Communications. Prior to joining the staff, she worked at NYLON Magazine and a ghostwriting firm based in New York.

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