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Sunday, June 30, 2013

T-Mobile to Pay $308 Million for More Spectrum

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 deploy ed 4G LTE in over 290 markets, and 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 - in addition to spurring competition in the wireless marketplace.”

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 - 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.