Verizon to Pay $3.6B for 260M More Customers
A deal announced on Friday will give Verizon access to 20MHz of AWS wireless spectrum that would cover around 259 million potential customers. Verizon will pay $3.6 billion to purchase 122 AWS licenses from cable industry joint venture SpectrumCo, which is owned 63.6 percent by Comcast, 31.2 percent by Time Warner Cable and 5.3 percent by Bright House Networks.
AWS stands for “Advanced Wireless Services” and is the wireless spectrum band use for mobile and data services.
In the deal, Comcast will receive $2.3 billion, Time Warner $1.1 billion and Bright House $189 million. It would allow Verizon to double up – and in some regions triple up – on its LTE (long term evolution) network, which would create huge overhead for the company’s mobile broadband growth in the future.
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This is a major win for Verizon in a market where wireless companies are all fighting for more spectrum resources. Verizon has not only gained a huge swatch of spectrum it can use for itself but has also taken resources off the table for other players.
With the purchase of this spectrum, Verizon would be able to operate another LTE network that is parallel to the current 4G network it runs at 700MHz. In areas where there is overlap with SpectrumCo’s AWS holdings, Verizon will have 60MHz of spectrum, enough to build mobile broadband networks that have three times the capacity of what it has on LTE today.
Comcast, Time Warner, Bright House and Verizon have agreed to be agents for each other’s products although while the deal is still pending, Verizon officials have declined to comments on future plans.
