Verizon to use new spectrum for advanced wireless

WASHINGTON Fri Apr 4, 2008 8:40pm BST



WASHINGTON (Reuters) - Verizon Wireless said on Friday it would use the airwaves it won in a government auction last month for its next generation of high-speed wireless services, expected to debut around 2010.

In a telephone conference with analysts, the company said the $9.36 billion (4.7 billion pounds) worth of new 700 megahertz spectrum would give Verizon Wireless, the No. 2 U.S. mobile service, enough resources to build a faster wireless data network.

"We now have sufficient spectrum to continue growing our business and data revenues well into -- and possibly through -- the next decade," said Verizon Wireless CEO Lowell McAdam.

McAdam said the spectrum would be used for a network Verizon Wireless plans to build based on an emerging technology known as Long Term Evolution, which it expects to boost revenue by connecting "everything and anything together."

Verizon Wireless, a venture of Verizon Communications Inc (VZ.N) and Vodafone Group (VOD.L), will use the airwaves to connect a broad array of devices, such as digital media players, gaming consoles and even home appliances, McAdam said.

Verizon Wireless and AT&T Inc (T.N) won the lion's share of the spectrum up for grabs in the $19.12 billion auction, with AT&T spending another $6.64 billion.

Verizon Wireless won the largest single block of nationwide airwaves offered in the Federal Communications Commission auction, paying $4.74 billion for the portion of spectrum known as the "C" block.

Commenting on the 700-megahertz spectrum for the first time since the landmark auction ended on March 18, Verizon said it expects to launch its next generation wireless network "in the 2010 time frame."

The 700-megahertz airwaves are considered valuable because they travel long distances and can penetrate thick walls. They are being returned by television broadcasters as they move to digital from analogue signals in early 2009.

As part of the rules for the 700-megahertz auction, the FCC required the winner of the C block spectrum to make it an "open platform" accessible to customers using any device or software application.

As a result Verizon has promised to support devices and software applications that it does not offer directly itself.

Verizon echoed a statement issued on Thursday night by AT&T, which said its added 700-megahertz auction would be used to move into the next generation of wireless broadband services.

AT&T executives estimated the roll-out of a more advanced network at about 2012. However, unlike the airwaves acquired by Verizon, AT&T noted that its new spectrum was not burdened with the many regulatory requirements imposed on the nationwide block of spectrum that Verizon won in the auction.

The comments by Verizon came a day after the deadline expired for anti-collusion restrictions that were in effect during the auction and barred carriers from discussing the auction results.

A Google Inc (GOOG.O) executive on Friday called the auction results "very positive," citing the open-platform requirements on the C block spectrum and Verizon's open network initiative.

"We applaud their announcements about adopting this (open platform)," said Rick Whitt, Google's Washington telecom and media counsel.

Even though Google was outbid for the C block airwaves, the auction was seen as a victory for the company, since the bidding was high enough to trigger the open-platform rules that Google had sought.

However, Whitt also said that "the jury is still out" on the details of how Verizon will carry out the open-network promise.

(Reporting by Peter Kaplan; editing by Derek Caney and Gerald E. McCormick)