AT&t and Verizon agreed Tuesday to a $25 billion spectrum purchase in a deal that would bring the nation’s largest wireless carriers together in the midst of a wireless-only era.
The deal will provide wireless providers with about 40% of the spectrum for wireless service, but it won’t bring the two companies together until 2026.
The transaction is the culmination of years of negotiation and approval by the Federal Communications Commission, which oversees the nation\’s wireless industry.
The agreement is subject to regulatory review, but FCC Chairman Ajit Pai said he hoped it would be approved by the end of the year.
Pai said the spectrum sale would create jobs and help build a stronger wireless market, which he said would create millions of jobs.
He said it was important to bring together the industry, not compete against each other.
“This will create jobs, it will create new opportunities, it’ll build the strongest wireless market in the world,” Pai said.
The FCC has long sought to create the most open and competitive wireless marketplace in the country, where all mobile devices must have access to the same wireless spectrum.
The commission has also approved more than a dozen mergers and acquisitions since it was established in 2015, including a $15 billion takeover of Sprint and $3.2 billion for Charter Communications.
The deal is the largest in the history of wireless spectrum in the United States, which is reserved for mobile networks and services.
Verizon Communications Inc. (VZ), which is also a major wireless provider, will get more than two-thirds of the new spectrum.
Verizon said the purchase is the most recent in a series of major investments to boost the nation as a place to build the nation and serve its customers.
In December, the FCC voted to approve the purchase of another $1.5 billion in wireless spectrum by AT&sat and Verizon Communications.
The merger will create an 18.7 million square-mile wireless network, which will include 2.5 million towers and 3.2 million wireless hotspots.
Verizon is seeking to expand its wireless network into more rural areas, which the FCC said would make it easier for businesses to add wireless access to buildings and homes.
While Verizon said the deal would provide additional jobs, Pai said it would create more than 2.4 million net new jobs by 2026, a significant increase over the 682,000 net new employment created during the year prior.
During the merger, Verizon said it will acquire spectrum in New Jersey, which it owns.
In addition to creating a new wireless network in the state, the deal will create two new radio frequency bands, known as the low frequency band and the mid-frequency band, which would allow Verizon to offer high-speed broadband services.
AT&am will also receive spectrum from AT&esant, a joint venture between Verizon and AT&pbs.
The two companies will each receive $20 million to build a new 1.3 million-square-mile network, covering more than 100,000 square miles.
“We\’re very pleased to be partnering with Verizon to create this new wireless platform that will deliver faster and better Internet access, and we\’re confident that we\’ll create jobs for hundreds of thousands of people in New York state,” AT&ams President and CEO Lowell McAdam said in a statement.
Ajit Pai said AT&a will create tens of thousands more jobs over the next decade, and that the deal is essential to building a strong wireless marketplace that allows consumers to get the best wireless service.
Pai added that the new wireless spectrum will also be a boon for local governments.
Pai said the commission was pleased to have the new deal, which gives the nation its first wireless market that is open to competition and free of government interference, and also the new radio frequencies, which are expected to bring more competition and better wireless services to consumers.
The new spectrum is expected to allow for more competition in the wireless market and help bring more Americans online, he said.
Earlier this month, AT&nsd Chairman Tom Wheeler said the wireless industry was not going away, and the deal was important for consumers.
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