January 07, 2014, 2:40 PM — While T-Mobile and AT&T engage in a delightfully public PR urination competition, the wireless industry still trudges along. Verizon announced Monday that it had agreed to sell a block of unused spectrum to T-Mo in exchange for cash and spectrum licenses.
The deal is split into two parts: Part one will transfer 15 lower 700 MHz A Block licenses from Team Red to Team Magenta for just under $2.4 billion. The second part of the agreement will send an additional eight A Block licenses to T-Mo in exchange for AWS and PCS licenses.
The deal is subject to FCC approval, and the companies expect it to be completed in the second half of 2014.
According to The Verge, Verizon purchased the block of spectrum for $2.4 billion, but the company never utilized it. Verizon has been trading and selling the unused spectrum to build revenue and realign its network since 2012.
Aside from a cash infusion, the deal provides Verizon additional spectrum around key markets including Los Angeles, San Francisco, Dallas, Atlanta, and Detroit.
Meanwhile T-Mobile will beef up its nascent LTE network around 26 markets including New York, Los Angeles, Washington D.C, San Francisco, and Dallas.
While these acronym- and Mhz-laden deals may glaze eyes of most smartphone users, they are vital to building better mobile experiences in the short and long terms.
In a short term, more spectrum allows carriers to expand and fortify their existing 4G LTE coverage. And looking ahead, new technologies will allow mobile devices to "stitch together" various non-continuous LTE bands together to create a much stronger mobile signal.