Not only does this spectrum swap end T-Mobile's vocal opposition to VZW's proposed purchase of SpectrumCo-Cox AWS holdings, but it also sets up both carriers to control huge swaths of contiguous AWS spectrum. Like two children trading Halloween candy, VZW and T-Mobile intend to swap and rearrange their disparate AWS licenses, thereby creating for each carrier uninterrupted blocks of typically 30 MHz, 40 MHz, or even 50 MHz. Since both T-Mobile and VZW plan to deploy LTE in AWS, the upshot of enhanced spectrum contiguity is that both carriers may be able to pursue larger LTE channel bandwidths.
T-Mobile will remain somewhat encumbered for the next several years, as it must continue to dedicate at least 10 MHz of its AWS holdings to its W-CDMA/HSPA+ network. As a result, T-Mobile is most likely to stick to 10 MHz x 10 MHz LTE channels for now. But VZW is coming to AWS anew and will have ample, completely fallow spectrum. For example, in the top 25 markets, VZW may be able to deploy fully 20 MHz x 20 MHz LTE in New York, Chicago, Boston, Miami, Pittsburgh, Minneapolis, Atlanta, Seattle, and Tampa.
While this transaction may be more important to T-Mobile, which needs the swaps to fill glaring gaps in its LTE spectrum portfolio in many markets, VZW comes away looking more shrewd than ever. VZW offers what appears to be an olive branch to garner favor for its SpectrumCo-Cox acquisition but parlays that concession into spectrum that — due to its contiguity — is arguably even more valuable than that of SpectrumCo-Cox alone.
Of course, all of the above is contingent upon FCC approval of the VZW-SpectrumCo-Cox and VZW-T-Mobile transactions, as well as two smaller spectrum swaps involving VZW-Leap and T-Mobile-Leap. Assuming that all get the go ahead, here is a look at VZW and T-Mobile AWS spectrum holdings, both pre and post transaction, in the top 25 markets (where VZW and T-Mobile combined would control 75 percent of all AWS spectrum):
Sources: T-Mobile USA, FCC, CNET