U.S. wireless carriers AT&T and T-Mobile may duke it out for the purchase of Verizon Wireless spectrum licenses.
Verizon's block of airwaves or spectrum is said to be very valuable as it has the ability to carry signals over long distances and also penetrate in buildings. Verizon bought the spectrum for around $2.4 billion and analysts estimate that the company is expecting $2.75 billion from its sale.
Data traffic on smartphones and other mobile devices such as tablets is growing at a very fast pace and carriers are looking to expand their spectrum and offer services to the growing data traffic needs. A Wall Street Journal report cites sources familiar with the matter and reports that both AT&T and T-Mobile are expected to make a bid for the Verizon Wireless spectrum to expand their reach in the market.
This is not the first time that Verizon Wireless has tried to sell its airwaves. The company has previously tried to sell the spectrum but was unable to do so and now the deal still remains open.
The Verizon Wireless spectrum is in the "A block" in the lower 700 megahertz frequency. Availability of this kind of spectrum is limited and regulators have indicated that there should be a cap placed on the ownership of such spectrum to avoid potential monopoly by big players, such as Verizon and AT&T.
Per reports, AT&T and Verizon combined own about 75 percent of the low-band spectrum currently in use by wireless operators and AT&T's effort to buy the A-Block may get complicated if regulators impose an ownership limit on these spectrums.
Meanwhile, T-Mobile has raised around $4 billion by selling stock in anticipation of purchasing the low-band spectrum. Moreover, the company's executives have also expressed their desire to buy the lower frequency spectrum to expand their reach and attract more customers.
Neither AT&T nor T-Mobile have commented on the matter.
