In order to boost 4G LTE markets in the U.S. as well as to
free up the nations under utilized spectrum, Federal
Communications Commission (FCC) has approved
) - the second-largest wireless carrier in the country to buy
Wireless Cellular Service (WCS) and Advanced Wireless Service
(AWS) spectrum bands from four companies namely,
NextWave Wireless Inc.
), San Diego Gas & Electric Co. and Horizon Wi-Com LLC.
Higher usage of smartphones and tablets coupled with
limitation of spectrum are continuously putting huge pressure on
AT&T's network. So, in a bid to improve its spectrum shortage
the company planned to acquire T-Mobile USA - the third largest
carrier in the country. However, the deal failed to get FCC
approval as it might give rise to unhealthy competition across
U.S. telecom industry.
While at the same time Verizon Wireless, which is the largest
telecom operator of the nation is continuously expanding its
4GLTE markets. At present, Verizon Wireless has more than 470 4G
LTE footprints as compared to AT&T's 125 4G LTE markets.
In order to expand its 4G LTE coverage as well as to catch up
with the nation's largest carrier, AT&T is aggressively
buying spectrum of 2.3 GHz band from these companies which holds
unused AWS and WCS spectrums. Acquisition of these spectrums will
allow AT&T to bring at least 82% of the country's population
under its radar, covering nearly 48 states.
We maintain our long-term Neutral recommendation on
AT&TInc. Currently, it has a Zacks#3 Rank, implying a
short-term Hold rating on the stock.
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