AT&T Buys Qualcomm’s FLO TV Spectrum for its 4G Network

AT&T and Qualcomm have announced this morning that AT&T will purchase spectrum licenses from Qualcomm in the lower 700 MHz range for $1.9 billion. The licenses were previously used to to support Qualcomm’s FLO TV business, which will be shuttered, network included, in March 2011.

According to AT&T, the added spectrum will be used to enhance the company’s 4G network, where it will help deliver “substantial capacity gains.”

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The spectrum covers over 300 million people in the U.S., including 70 million in five of the top 15 major metropolitan areas: New York, Boston, Philadelphia, Los Angeles and San Francisco, which are all covered by 12 MHz of Lower 700 MHz D and E block spectrum. Six MHz of Lower 700 MHz D block spectrum then covers 230 million across the rest of the country.

AT&T says it will deploy the spectrum to serve as “supplemental downlink, using carrier aggregation technology,” which will “address increased consumer demand for rich mobile media content.” Or, in simpler terms, AT&T is beefing up its network so you can watch more YouTube videos on your phone.

Qualcomm says that it will integrate the carrier aggregation technology into its chipset roadmap and AT&T said it will begin deploying this spectrum once compatible handsets and network equipment are developed (iPhone 5, anyone?)

Why We Care

What’s so great about the 700 MHz block of spectrum? Well, if you go by what the Engadget commenters are in a tizzy about, it’s the fact that this spectrum frequency has better building penetration, as it falls on the lower end of the scale.

And, as is usually the case, those Engadget commenters are well clued-in. Bloomberg quoted Craig Moffet, an analyst with Sanford C. Bernstein & Co., as saying much of the same thing. “This is very high-quality spectrum. It’s especially concentrated in the urban areas,” he said.  “It provides a very strong signal inside buildings and it’s extremely good at penetrating walls and windows.”

Moffet said the spectrum will help AT&T with the network congestion problems such as those experienced by iPhone users.

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