mmWave Transactions Focused on 5G – Upper Bands are “Hot”

How much spectrum is required for 5G? The short answer is a lot. The detailed answer varies according to each carrier’s spectrum holdings but most carriers will need to at least double or more than double their spectrum holdings to offer quality 5G services. Spectrum in different bands will also be required for coverage and capacity… low, mid and upper bands.

While the Incentive Auction result will start to address the need for 5G in low band spectrum, secondary market transactions are now focused on mid and upper band licenses.

Upper band, or mmWave, provides large channel bandwidths, creating the opportunity of providing for multi-Gbps service speeds. mmWave is becoming a key element of 5G, eventually to be part of global standards now in development.

Bidding by Verizon and AT&T to acquire StraightPath took the industry by surprise, with Verizon eventually paying US$3.1 billion. StraightPath’s licenses are in the 28 GHz and 39 GHz ranges and provide hundreds of MHz in many markets, a capacity that dwarfs the amount of spectrum awarded by the FCC in the AWS-3 and 600 MHz Incentive Auction.

For those with memories of Teligent, Winstar, NextLink, CellularVision, et al, the upper bands – 24, 28, 39 GHz – will sound familiar. Over the years the FCC auctioned over 3,000 licenses in these bands. While a number of licenses are already in the hands of the national mobile carriers – AT&T, Verizon, T Mobile (MetroPCS) and Sprint – there are many held by other operators or investors that could conceivably attract buyer interest, particularly now that Verizon has raised the bar.

Of interest, the FCC has an open docket on mmWave – spectrum at 24 GHz and higher – and this could result in an auction of licenses as well, adding yet another band to the FCC agenda.