Top News

Samsung Boosts Entertainment Options with Blockbuster Deal

T-Mobile Releases Samsung Galaxy S Blaze 4G

U.K. Serves Legal Papers on Facebook, Spurs Privacy Concerns

For Gen Y, Smartphones Are Necessities

Hackers Eyeing U.S. Power Grid, NSA Warns

More News >

The Dallas, Texas-based carrier filed the request with the Federal Communications Commission, the same agency that played role in the demise of the AT&T/T-Mobile merger. AT&T will also give T-Mobile $3 billion in cash as part of its compensation deal in the failed deal.

"This additional spectrum will help meet the growing demand for wireless broadband services," said T-Mobile's senior vice president for government affairs Tom Sugrue. "We hope the FCC will move swiftly to approve the license assignments."

The FCC has been stingy with deals that involve spectrum changing hands, but the agency is likely to approve this transaction quickly. The FCC helped put an end to AT&T's merger plans because it wanted T-Mobile to stay an independent competitor in the mobile market, and this new spectrum will strengthen the carrier.

The new spectrum will help T-Mobile tremendously as the fourth-place carrier struggles to keep up with Verizon, AT&T and Sprint. The three largest carriers in the U.S. are all in the midst of building LTE networks, while T-Mobile continues to rely solely on the inferior HSPA+ technology to anchor its 4G offerings.

T-Mobile took a severe financial hit and a lost a significant number of subscribers during the attempt to approve the merger with AT&T, and the spectrum and cash compensation will likely help the carrier get back on its feet.

AT&T, however, may hope this is one time the FCC denies its request. The carrier's LTE network lags far behind Verizon's, its chief rival. The carrier has not only had its plans to gain spectrum dashed, but it will have to give up $1 billion worth of the rare resource.

AT&T is still financially healthy and can acquire the spectrum its losing by striking new deals with cable providers and other companies, such as its deal to acquire airwaves from Qualcomm. But the carrier will have to spend billions of dollars and still face the FCC for approval of those deals.

AT&T's payout to T-Mobile is a tough hit for the company, but once the FCC approves the transaction, the carrier can finally begin to put the consequences of the failed merger in the past.