AT&T's 700 MHz Strategy: LTE
The open access restrictions mandated by the Federal Communications Commission on portions of the recently auctioned 700 MHz spectrum were among the main reasons AT&T chose not to bid for that spectrum but opted instead to pay more for that of the B-Block …
Context & Ripple Effects
AT&T's hesitation about the 700 MHz auction was visible months before results landed — it had already hedged by buying spectrum from Aloha Partners and publicly wavered on whether to bid at all in the FCC's flagship sale. Once the auction closed, the outcome is now clear: AT&T skipped the open-access-restricted C-Block entirely and paid a premium for the more permissive B-Block, committing to LTE as its deployment technology.
First-order effects
- AT&T gets nationwide 700 MHz spectrum free of the FCC's open-device and open-application mandates, letting it keep its existing closed handset-and-service model while still upgrading to LTE.
- The premium price for the B-Block means AT&T pays more per MHz than C-Block winners like Google-backed bidders, trading cost for regulatory freedom.
Second-order effects
- Verizon and other carriers watching this decision get a template: bid around open-access conditions rather than fight them, which could depress future bids whenever the FCC attaches openness requirements to spectrum.
- Device makers and application developers lose a guaranteed open national wireless platform — the C-Block's openness now matters mainly through whoever actually won it, not through industry-wide adoption.
Third-order effects
- If carriers consistently pay premiums to avoid open-access strings, the FCC's leverage to impose openness via spectrum auctions weakens, pushing any future open-wireless mandate toward explicit rulemaking rather than auction conditions.
- LTE consolidates as the de facto North American 4G path — a bet later validated when T-Mobile built its own strategy around 700 MHz spectrum and an LTE rollout — locking in carrier-controlled network economics for a decade.
The trend: Carriers are willing to pay a premium to acquire spectrum without open-access conditions, signaling that openness mandates attached to auctions may shape who bids but rarely change how networks are run.