AT&T will buy mobile spectrum in the 700MHz band from Verizon Communications for US$1.9 billion, AT&T said Friday.
AT&T will pay cash and trade AWS (advanced wireless services) spectrum for the B block of the 700MHz spectrum, the company said. Verizon will gain AWS spectrum licenses in several markets, including Los Angeles, Phoenix, and Portland, Oregon, AT&T said in a press release.
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In April, Verizon pledged to sell off two 12MHz blocks of mobile spectrum in the 700MHz band, including the B block, if U.S. regulators approved its purchase of spectrum from a group of cable providers.
The U.S. Federal Communications Commission approved Verizon's purchase of the cable spectrum in August.
Verizon purchased the 700MHz spectrum in a 2008 FCC auction. AT&T was also a major purchaser of B block licenses. The 700 MHz licenses to be acquired by AT&T cover 42 million people in 18 states, including California, Florida, New York and Virginia.
The deal complements AT&T's existing holdings in the B block, the company said in a press release. The new spectrum will help the company deploy 4G LTE services and meet mobile broadband demand from smartphones and tablets, it added.
In conjunction with the transaction, AT&T will sell a single AWS license to Grain Management, a wireless private equity firm, and will lease 700 MHz spectrum from Grain Management in three markets.
The transaction is subject to regulatory approval. AT&T said it anticipates closing the transaction in the second half of 2013.
Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is email@example.com.