AT&T Inc. completed successful bids for prime B Block spectrum in the FCC auction. Combined with the Aloha Partners transaction, which closed earlier this year, AT&T has supplemented its holding of high-quality spectrum and continues to have a leading spectrum position in the industry.
AT&T's spectrum holdings position the company to further enhance the quality and reliability of existing wireless broadband and voice services that consumers are demanding, and set the foundation for more customer choices for new, more advanced wireless broadband technologies and services.
The complementary nature of the spectrum AT&T acquired through the FCC auction and from Aloha Partners gives AT&T the capacity to meet customer needs as the company moves to higher-speed 4G (fourth-generation) services. Upon final award of the auctioned B Block spectrum, AT&T's 700 MHz spectrum will cover 100 percent of the top 200 markets and 87 percent of the U.S. population, enabling the company to better compete in a vibrant and dynamic marketplace.
"Results of the auction bidding demonstrate the B Block was the most attractive, most valuable spectrum available, and it was the best investment for AT&T and our customers," said Ralph de la Vega, president and CEO of AT&T's wireless unit.
"Our winning bids for B-Block spectrum, combined with the C-Block spectrum we acquired from Aloha Partners, significantly enhances AT&T's spectrum portfolio, which is already one of the broadest, highest-quality and most efficient in the industry," de la Vega said. The C-Block spectrum AT&T acquired from Aloha Partners is not subject to the same strict regulations imposed on the C Block spectrum that the FCC recently auctioned.
"With fewer costly and complex regulations, we have the certainty and flexibility needed to move faster in rolling out new mobile technology and more customer choices in devices and applications," de la Vega said. "We will put our spectrum to work so that customers can do more with their wireless devices, the user experience is superb, and wireless connectivity can be embedded in more devices."
Wireless broadband traffic on the AT&T network has quadrupled every year since 2004, as customers have taken advantage of faster broadband speeds and emerging wireless applications ranging from live video sharing to social networking and business applications.
The company's wireless network is based on GSM (Global System for Mobile Communications) technologies, the most open and widely used wireless network platform in the world. GSM supports 85 percent of the people worldwide who use wireless devices in more than 200 countries. AT&T allows any unlocked GSM device that operates on 850 or 1900 MHz frequency on its network, and there is no minimum term commitment required.
The company's GSM technology platform positions AT&T to continually adopt next-generation technologies, and allows wide-ranging customer choice from devices and content to applications and operating systems. Importantly, AT&T devices use GSM SIM-based technology, which will allow for an easier, more efficient and backward-compatible transition from 3G to 4G services for our customers. This GSM advantage will allow a 4G device to work in an area that is served by 3G or even 2G service. Also, being a GSM carrier allows AT&T to offer customers more choices of devices, applications, content, plans and worldwide coverage than any other U.S. provider.
AT&T today offers every major operating system and will add new ones when they become available and customer demand exists.
"From the beginning, our wireless network has been designed for customer choice and with the future in mind," said de la Vega. "Our applications program includes thousands of developers who are creating innovative applications for AT&T's wireless devices today. And looking even further into the future, our existing technologies are ideal for a smooth transition to next-generation platforms."
In the future, AT&T's 700 MHz spectrum holdings will provide the foundation for deployment of next-generation wireless broadband platforms such as HSPA+ and LTE. While standards for emerging technologies such as LTE are still being developed, these technologies could enable peak broadband speeds of 100 Mbps or more.
AT&T currently plans to deliver AT&T 3G services to nearly 350 leading U.S. markets by the end of 2008, including all of the top 100 cities. The 3G initiative will include the rollout of more than 1,500 additional cell sites nationwide. The company also will complete the nation's first High Speed Uplink Packet Access (HSUPA)-enabled network by the middle of the year. This advanced network delivers typical downlink speeds ranging between 600 and 1,400 kilobits per second (Kbps), as well as faster uplink speeds ranging from 500 and 800 kilobits per second (Kbps).
AT&T does not expect this spectrum purchase to have a material impact on its operating results.
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