The battle for control of the telecommunications space is fierce between major players like Verizon, Sprint, T-Mobile and AT&T. It seems as though as soon as one company makes an announcement, the other companies quickly follow suit announcing similar features of their own. While this is an effective strategy for things like pricing and unlimited data plans, Verizon, Sprint and T-Mobile are about to have to rethink their gameplans—AT&T is playing the long game. Earlier this month, AT&T announced that they are offering $1.6 billion for Straight Path Communications.
Not familiar with Straight Path? You’re not alone. The Straight Path website defines the company as being “…the largest commercial holder of the 39 GHz spectrum, with about 95 percent of the total licenses commercially available, as well as a significant holder of 28 GHz in major markets, including New York and San Francisco”. What does that mean? It means AT&T just bought the airwave spectrum rights needed to run a successful 5G wireless infrastructure.
Straight Path’s airwave licenses cover the entirety of the United States, including the top 40 markets. By buying access to these frequencies AT&T will continue to lead the charge towards 5G speeds, which will open up a host of possibilities—think streaming HD DirecTV Now content directly to your device wherever you are.
“This acquisition will support AT&T’s leadership in 5G, which will accelerate the delivery of new experiences for consumers and businesses like virtual and augmented reality, telemedicine, autonomous cars, smart cities and more,” according to the statement from AT&T.
This purchase will give AT&T the appropriate amount of spectrum holdings to be able to effectively offer 5G speeds that exceed what is currently in use. This is all, of course, assuming that the FCC approves this deal. However, given the recent turnaround in the FCC’s opinion of net neutrality issues it is unlikely that this will be much of an issue. The deal is expected to officially close by the end of 2017.