The Federal Communications Commission on Monday declined to approve AT&T's purchase of Qualcomm spectrum, opting to instead merge its investigation into the sale with its ongoing inquiry into the merger of AT&T and T-Mobile.
AT&T's pending Qualcomm and T-Mobile purchases "raise a number of related issues, including, but not limited to, questions regarding AT&T's aggregation of spectrum throughout the nation, particularly in overlapping areas," Rick Kaplan, chief of the FCC's wireless telecom bureau, wrote in a letter to AT&T and Qualcomm executives. "As a result, we have concluded that the best way to determine whether either or both of the proposed transactions serve the public interest is to consider them in a coordinated manner at this time, without prejudice to independent treatment at a later date."
In December, Qualcomm announced that it would sell its Lower 700 MHz D and E block spectrum licenses to AT&T for $1.925 billion. Qualcomm was using the spectrum for its FLO TV digital mobile TV business, but announced last year that it would be shut down by March 2011. AT&T planned to use the spectrum as a supplemental downlink for its 4G network via carrier aggregation technology.
In March, meanwhile, AT&T surprised the tech community when it announced plans to acquire T-Mobile for $39 billion. AT&T argued that the purchase will help stop the spectrum crunch and spur the companies' deployment of 4G service.
The company has encountered backlash from competitors like Sprint, as well as Democratic senators like Herb Kohl and Al Franken. Some top tech companies, however, have issued their support for the deal. When it comes down to it, though, the FCC and Department of Justice will have the final say.
In an effort to keep the process moving, the commission sets an informal 180-day "shot clock" on such transactions. With yesterday's letter, however, the commission has stopped that shot clock on the Qualcomm spectrum purchase, Kaplan said.
The FCC did the same thing with the AT&T-T-Mobile deal last month after AT&T announced that it had developed new models on which it was basing the merger.