AT&T buys Verizon spectrum for $1.9 billion
AT&T will be buying $1.9 billion of 700MHz spectrum from Verizon to beef up its 4G LTE network
While AT&T and Verizon are bitter rivals, the two can work together when it makes sense. Now Verizon and AT&T have engaged in a spectrum swap, which will give AT&T a lot of ammunition for its 4G LTE network in exchange for $1.9 billion.
AT&T will be getting 39 lower 700MHz B Block licenses in a variety of markets, including Chicago, Los Angeles, Miami, Memphis and more. Along with the nearly $2 billion payout, Verizon will also be receiving some 10MHz AWS spectrum from AT&T in the deal. This covers markets like Los Angeles, Phoenix, Fresno and Portland, Ore.
The Verge has a detailed breakdown of what this means for the carriers' strategies moving forward, but basically, both carriers are trying to secure their positions in a 4G LTE world. Verizon already has nearly 500 markets blanketed in 4G LTE while AT&T is still rushing to catch up.
Spectrum is the lifeblood of the carriers and there's a limited supply -- AT&T can't just reuse the spectrum that supports its 3G network for 4G LTE. That's why it's willing to shell out $2 billion for this allotment from Verizon. Heck, it was willing to spend $36 billion to buy T-Mobile and its valuable spectrum assets before that was swatted down by the government.