T-Mobile USA Inc.’s campaign to limit its rivals’ access to new radio frequencies in an upcoming government auction just got a shot in the arm.
A spectrum auction held last month by the Federal Communications Commission, and another planned for the fall will likely raise the $7 billion needed to fund FirstNet, a nationwide interoperable radio network that police, fire fighters and medical technicians can use during emergencies, according to Phil Verveer, senior counsel to FCC Chairman Tom Wheeler. Verveer’s comments were published in the trade journal Broadcasting & Cable.
"We've had one auction, we're going to have another that is going to help meet the statutory requirements with respect to contributions,” Verveer was quoted as saying at a telecommunications conference in Washington. “We're going to be very close or perhaps even have met them by the time the incentive auction takes place."
The FCC raised $1.6 billion in last month’s auction, and it expects to bring in the remaining amount, at least $5.4 billion, from another auction of airwaves later this year.
Reaching that milestone relieves some pressure on the agency to maximize revenue from another airwaves auction scheduled for next year, in which T-Mobile and its wireless rivals will compete for rare and valuable spectrum in the 600-megahertz band.
Wireless carriers covet these so-called low-band frequencies because they travel farther and penetrate buildings better than higher frequencies, characteristics needed to handle more traffic and to build a nationwide network that doesn’t drop calls or lose Internet connections. The top four wireless carriers are waging a high-stakes lobbying war in Washington, each trying to convince the FCC to write auction rules favorable to their company.
AT&T Inc. and Verizon Communications Inc. already own a combined 74 percent of the low-band signals, according to FCC data. Sprint Corp., the distant No. 3 carrier, has some low-band spectrum, and No. 4 T-Mobile has almost none.
The smaller companies say they need the frequencies to improve their networks to compete with the larger two carriers. If AT&T and Verizon outbid rivals for most of the valuable spectrum, Sprint and T-Mobile lobbyists, as well as anti-trust lawyers in the Justice Department, say the bigger rivals will dominate the market, leading to a duopoly, higher prices and less technological innovation.