Verizon to AT&T: Want more spectrum? Here’s how you get it.

Unlike AT&T, which is attempting to acquire T-Mobile for $39 billion and hitting roadblocks at the Federal Communications Commission and the Department of Justice, Verizon is likely to work a deal that gives it up to 20 MHz more of unused spectrum to deploy for LTE in all major U.S. markets. This is no small feat, as one of the suspected lures of T-Mobile’s AWS spectrum for AT&T was that it allowed AT&T to deploy an LTE network without having to worry about phasing out customers using its existing spectrum for 2G and 3G devices.

Now Verizon stands to get pristine spectrum in the AWS band that it can combine with its 700 MHz airwaves it won at auction for LTE. The key for FCC approval lies in the fact that this spectrum is unused, according to sources in Washington DC. Because there are no customers on it right now, it’s an asset, and Verizon’s acquisition of it doesn’t affect actual customers or an existing market. Thus, a competitive market analysis like what the DoJ and the FCC evaluated in the AT&T and T-Mobile deal doesn’t make sense. Plus, coming immediately after the FCC all but quashed the AT&T attempt to purchase T-Mobile, while also releasing a report that essentially accused Ma Bell of lying, it’s unlikely to react so boldly a second time, especially as we head into an election year. When I asked the FCC for comment, a spokesman replied, “When the applications come before us, the FCC will undertake a thorough, fair and fact-based review of the proposed transaction.” The FCC, however, can evaluate the deal against its spectrum screen as opposed to looking at how the deal would affect individual markets. The FCC has the ability to evaluate transactions that allow one player to hold a large amount of megahertz in a given market, and Public Knowledge, a consumer lobbying group has called on the FCC to do exactly that.