T-Mobile and a few other smaller carriers, have been petitioning the FCC for months leading up to this vote. Regarding the 600MHz spectrum that’s going to be auctioned off early next year. The reason T-Mobile wanted to put these limits on AT&T and Verizon is because they already have a ton of low-band spectrum, compared to Sprint and T-Mobile, and because AT&T and Verizon are much larger, they have a whole lot of cash to spend and can squeeze T-Mobile out of getting the 600MHz spectrum.
Today, the FCC voted, and decided to keep the reserve at 30MHz, a little less than half of what will be up for auction. T-Mobile wanted the reserve to be bumped up to 40MHz, or roughly half of what will be auctioned off. This reserve is actually unprecedented as there is typically no reserve when it comes to spectrum auctions.
While this wasn’t necessarily good news for T-Mobile, their CEO John Legere isn’t taking it too badly. He’s said that they are still going to show up to the auction next year and play hard. Low-band spectrum is the most precious thing right now, especially for T-Mobile. Because with low-band spectrum, specifically anything under 1GHz, it allows you to cover more and more people with less towers. Something that T-Mobile is really lacking. Additionally, it allows for better building penetration from T-Mobile’s towers. Currently, about two thirds of the low-band spectrum is being used by AT&T and Verizon. While Sprint has some 800MHz low-band and T-Mobile just recently bought a bunch of 700MHz from Verizon and a few other smaller regional carriers.
This isn’t the end. As you’d expect, T-Mobile is still going to fight and increase that reserve for this auction. And Legere has not lost his way here, and still wants to create wireless competition here in the US. The Incentive Auction or the 600MHz auction, is set to take place in Q1 of 2016. So we’ve still got plenty of time to hear more and more about this spectrum auction. Hopefully it will help create more wireless competition. After all, all that does is make it better for us, the customers.