Leading wireless company
Verizon Communications Inc.
) is reportedly eying a spectrum buyout from
DISH Network Corp.
) in a bid to accelerate its Internet speed. Although no official
announcements were made in this regard, news reports suggest that
the two companies have long been engaged in talks over the
While Verizon may benefit internally from this planned spectrum
purchase, it will also help the company in averting regulatory
challenges associated with buying through spectrum auctions. Going
forward, one of the major hurdles for behemoths like Verizon will
be the restrictions proposed by Federal Communications Commission
Chairman Tom Wheeler, for 2015 spectrum bids, which demonstrate
limitations on bids by large carriers so as to help smaller telecom
and Internet companies gain competitiveness.
Verizon Communications has a strong foothold in the wireless
market and expects growth from higher penetration of devices and
increasing market penetration of 4G LTE services. As a result, it
is always on the lookout for more spectrums to boost its network
capacity and support growth goals. In this context, on Jan 6, 2014,
Verizon Wireless had announced its agreement to transfer 700 MHz A
Block spectrum licenses to
T-Mobile USA Inc.
) for $2.4 billion and spectrum licenses in the AWS and PCS bands.
The bands will help in expanding Verizon's 4G LTE network coverage.
The transaction is expected to close by the first half of 2014.
Thereafter, in Apr 2014, the company had entered into an
Cincinnati Bell Inc.
) for purchasing spectrum licenses worth $194 million. The deal is
expected to close by the second half of this year and would
incorporate licenses in key markets like Greater Cincinnati and
Dayton, Ohio areas of northern Kentucky and southeastern Indiana.
In these areas, Cincinnati Bell reportedly offers GSM-based 2G, 3G
and HSPA+ services through 460 cell sites.
Verizon currently has a Zacks Rank #3 (Hold).
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DISH NETWORK CP (DISH): Free Stock Analysis
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