AT&T and Qualcomm Incorporated announced today that AT&T has agreed to purchase spectrum licenses in the Lower 700 MHz frequency band from Qualcomm for $1.925 billion. The move will bolster AT&T’s ability to provide an advanced 4G mobile broadband experience for its customers in the years ahead.
Qualcomm currently uses the licenses to support the service business of FLO TV Incorporated, a wholly owned subsidiary of Qualcomm, and the sale follows Qualcomm’s previously announced plan to evaluate strategic options for the FLO TV business. Qualcomm expects that the FLO TV business and network will be shut down in March 2011.
The spectrum covers more than 300 million people total nationwide: 12 MHz of Lower 700 MHz D and E block spectrum covers more than 70 million people in five of the top 15 U.S. metropolitan areas — New York, Boston, Philadelphia, Los Angeles and San Francisco; 6 MHz of Lower 700 MHz D block spectrum covers more than 230 million people across the rest of the U.S.
As part of its longer-term 4G network plans, AT&T intends to deploy this spectrum as supplemental downlink, using carrier aggregation technology. This technology is designed to deliver substantial capacity gains and is expected to be enabled with the completion of 3GPP Release 10. AT&T expects to begin deploying this spectrum once compatible handsets and network equipment are developed.
As more fully described in its separate announcement today, Qualcomm intends to integrate carrier aggregation technology into its chipset roadmap, to enable supplemental downlink to address increased consumer demand for rich mobile media content. AT&T expects to deploy this technology, demonstrating its commitment to deliver a great mobile broadband experience — now and in the future.
The transaction is subject to regulatory approvals and other customary closing conditions, and AT&T and Qualcomm anticipate closing the sale during the second half of calendar year 2011.