We rarely think of frequency spectrums to be a finite resources, but some of the wireless carriers in the U.S. are already bumping into their limits. Spectrum issues can lead to a network slowdown, like the one we saw last summer, and the only way to get more is to buy it.
To beef up their network, AT&T announced today that they have agreed to acquire spectrum in the 700 MHz band from Verizon Wireless. The deal covers 18 states and will cost AT&T $1.9 billion in cash.
The 700 MHz licenses acquired by AT&T will boost coverage for over 42 million people in the U.S. The list of 18 states included in the deal are California, Colorado, Florida, Idaho, Illinois, Louisiana, Montana, New Mexico, New York, Ohio, Oklahoma, South Dakota, Tennessee, Texas, Utah, Virginia, Washington and Wyoming.
AT&T’s spectrum deal with Verizon comes just a few days after it purchased the Atlantic Tele-Network (Alltel) for $780 million this week. It’s also been rumored that AT&T is looking to merge with a major European carrier as domestic growth in the U.S. has been slowing lately.