Officials with the Verizon Wireless management team advised investors during a conference call on Tuesday that Verizon’s winnings in the recent Advanced Wireless Service (AWS)-3 auction have satisfied the company’s spectrum requirements to the extent where large, near-term spectrum buys are no longer needed to fill gaps in coverage.
With net winning bids of $10.4 billion that encompass 181 licenses and a population of 192 million, Verizon claimed second place in the AWS-3 sale that ended on January 29. Prior to the start of the auction on November 12, Verizon’s average nationwide spectrum holdings were 105 MHz which includes 36 MHz in the AWS-1 band. According to Verizon Chief Technology Officer Tony Melone, the AWS-3 license winnings boost Verizon’s average nationwide AWS coverage to 48 MHz, which meets the company’s goal of covering 100% of the population in the top 25 U.S. markets with at least 40 MHz of AWS spectrum that will be earmarked for LTE. For all U.S. markets, the auction winnings boost Verizon’s total AWS coverage (defined as at least 40 MHz per market) from 70% to 95%. Officials also confirmed that Verizon intends to augment its wireless broadband capacity further by re-farming its 1.9 GHz assets for LTE and by eventually shifting all CDMA traffic onto the carrier’s new voice-over-LTE network.
Declaring, "we improved our spectrum depth in the markets that we wanted," Verizon Chief Financial Officer Fran Shammo told investors that the company no longer needs to acquire "a large block of spectrum in the near term." To fill smaller gaps in coverage, Shammo said that Verizon will instead look toward the secondary spectrum markets and to spectrum lease arrangements. Meanwhile, with respect to incentive auctions of reclaimed broadcast television spectrum that are expected to begin early next year, Melone did not rule out the possibility of Verizon’s involvement and emphasized that the company “will carefully look at the rules and evaluate if, and, or how our participation would enhance achievement of our network strategy.”