Verizon Wireless, which is jointly owned by Verizon Communications Inc. (NYSE: VZ) and Vodafone Group PLC (NASDAQ: VOD), will receive Advanced Wireless Spectrum and Broadcast Personal Communications Spectrum assets in northern California and the Atlanta area, while T-Mobile gets low-band, A-block spectrum assets that will give it 4G coverage in nine of the 10 largest U.S. markets. The announcement did not specify exactly which markets are affected.
Improving its 4G network appears to be another shot across the bow of AT&T Inc. (NYSE: T). Last week AT&T introduced a plan to counter T-Mobile’s efforts to lure customers to switch to T-Mobile’s so-called Un-carrier plan. AT&T offered a $200 credit to a customer’s phone bill and up to $250 as a trade-in on an old phone for a new AT&T phone. T-Mobile is expected to announce a new offer to potential subscribers at this week’s Consumer Electronics Show. The plan will offer to buy out the early termination fees for customers who switch to T-Mobile.
Why pick on AT&T? In virtually every customer survey, AT&T ranks lowest in service. By adding spectrum and making it easy and cost-free to switch carriers, T-Mobile clearly hopes to boost its own subscriber numbers. In the third quarter of 2013, the company added a net 672,000 subscribers. There is also the possibility of a tie-up with Sprint Corp. (NYSE: S). T-Mobile and Sprint combined would have a total subscriber base of around 100 million, in the same ballpark as Verizon Wireless with about 102 million subscribers and AT&T with about 109 million.
T-Mobile shares closed down more than 3% on Friday, at $32.28 in a 52-week range of $16.01 to $34.10. In premarket trading Monday, shares were up about 1.5% at $32.74.
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