T-Mobile USA, the fourth-largest American carrier, has agreed to pay $308 million to pick up a swath of spectrum, the radio waves that carry phone calls and data. The spectrum would enable the carrier to expand its new fourth-generation wireless network in 29 cities for 32 million people, the company said Friday.
The company made a deal to buy the spectrum from U.S. Cellular, a smaller carrier. The acquisition helps T-Mobile play catch-up to its rivals Verizon Wireless and AT&T. T-Mobile only recently started turning on its fourth-generation network, called LTE, in a small number of cities as it has been making extensive changes to its smartphone payment plans, which did away with traditional two-year contracts. By contrast, AT&T has deployed 4G LTE in over 290 markets, an Verizon Wireless has LTE in about 500 markets.
“In today’s marketplace, spectrum is gold,†John Legere, president and chief executive of T-Mobile, said in a statement. “This deal expands our network and capacity, allowing for a broader roll-out of 4G LTE and an even faster and more reliable 4G experience for our customers â€" in addition to spurring competition in the wireless marketplace.â€
In the American wireless market, Verizon and AT&T have long been the dominant players, accounting for about two-thirds of wireless subscribers here. T-Mobile had expected to even out the playing field with a proposed merger with AT&T in 2011 â€" a deal that was ultimately blocked by the Federal Communications Commission and the Justice Department after they concluded that the partnership would reduce competition and eliminate jobs.
T-Mobile’s proposed acquisition of spectrum from ! U.S. Cellular awaits regulatory approval from the F.C.C. and Justice Department. The transaction is expected to close in the fourth quarter of this year, T-Mobile said.
