FCC Grants T-Mobile/LB/Channel 51 Assignment Applications

On December 29, 2023, the FCC released a Memorandum Opinion and Order (“Order”) granting several assignment applications seeking FCC consent to assign 600 MHz spectrum licenses from Channel 51 and LB License to T-Mobile.  In the applications, T-Mobile sought to acquire 10 to 20 MHz of 600 MHz spectrum in 167 counties in all or parts of 50 cellular market areas.  In the Order, the FCC found that an analysis of the competitive harms and public interest favored grant of the applications.  The FCC also emphasized that the FCC’s screen is not a hard cap on a company’s holdings, but a trigger for further competitive analysis regarding the impact of a proposed transaction on the market for wireless services.  After consummation, T-Mobile will hold as much as 440 MHz of spectrum in certain markets (55 MHz above the screen).

First, the FCC concluded that the likelihood of competitive harm from the assignment was low, even though the acquisition would put T-Mobile over the screen in several markets.  The FCC noted that T-Mobile was already utilizing the spectrum through leasing arrangements with Channel 51 and LP License, so the overall effect of the assignment on competition was minimal.  Further, on a market-by-market basis, the FCC concluded that T-Mobile’s acquisition of the spectrum was not going to affect the total number of providers, was unlikely substantially change T-Mobile’s market share or spectrum holdings, and was unlikely to affect the market share or spectrum holdings of competitors in the market.

Second, the FCC found that the public interest would be served though continued use of this spectrum for 5G services, resulting in enhanced network coverage, capacity, and performance.  The FCC noted that a majority of the spectrum would be used to provide additional capacity and extended cell reach to low population density rural areas and provide building penetration to serve metropolitan customers in more urban areas, which is a public interest benefit.  The FCC was also persuaded that the transaction would result in a better user experience for customers.

Finally, the FCC rejected several of DISH’s arguments.  DISH argued that the FCC should (1) hold the applications in abeyance pending resolution of the spectrum holding policies proceeding and consider questions involving general competition and spectrum aggregation, including in markets outside those at issue in the applications; and (2) impose conditions or limitations on T-Mobile across all of its 600 MHz spectrum band holdings, including committing to spectrum swaps in the 600 MHz band, as needed, to enable more contiguity among other 600 MHz license holders.  The FCC concluded that these arguments had either been decided in earlier orders, were not transaction specific, or were beyond the scope of the applications.

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