Wednesday, January 28, 2009

Sprint Rents Out Alaska Spectrum

One of the best investments of the 20th Century was Sprint's purchase of PCS spectrum that covered the entire US. For a few billion dollars, Sprint owned wireless real estate that today costs tens of billions of dollars. Sprint was recently granted an application to the FCC to lease their PCS Alaska spectrum to Alaska Digitel, a CDMA carrier.

Even though there's lots of room for cellular service in Alaska, Alaska Digitel has as little as 15 MHz of spectrum across the state but wants more to serve the greater broadband needs of their own customers and CDMA roamers. The long-term leasing agreement gives them 66% more spectrum to work with.

Many of us had been hoping that Sprint would eventually build their own network in the 49th state, but since Sprint made this application late in 2007, it wasn't to be. The good news is that Alaska Digitel will be able to improve their service to the point that Sprint customers will be able to roam on a network superior to one Sprint could build on their own. That fact is even more important in recent months as Sprint goes through some severe economic troubles. They still own the frequencies, but Alaska Digitel will expand on them, we get more coverage, and Sprint gets a monthly check. It's a win-win...we think.

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