Taking Stock of the Spectrum

AT&T’s recent acquisition of ATNI comes at a point where AT&T is looking for ways to expand. According to CNET, the acquisition fulfills the need for more spectrum at least in the Southeast footprint. According to the Wall Street Journal, AT&T was looking toward Europe, but it’s hard to find a good target in the EU. DT, Orange, Telefonica and Vodafone have bought a lot of the eastern European assets. Besides that I am not sure going into the EU is the regulatory relief they would like to experience. The proceedings about the end of the PSTN are moving along here and the forces that want to keep AT&T in check are holding an event to explain why.

I have a rough time understanding the objections to the migration. It seems to me almost everything is based on Internet and Ethernet technologies in our future, so the question of ‘how to do it’ should not be burdened with the legacy issues of the past. 

To that point, the whole business is changing. The Dish Network’s decision to overbid Sprint for Clearwire begs the question, should Dish and Sprint look to merge? Given that Softbank is buying Sprint, it probably means that the company wants to be approached by Softbank. Sprint and Dish are about equal in market cap and both are facing an uncertain future. Dish has expressed a desire to get into the phone business and Sprint has been adventurous on occasion. 

Bundling video may make sense now in the over the top world. Verizon and Qualcomm experimented with Mediaflo but it never found the right price point. The big question about working with Dish is, is there a way for the video to not impact the phone network?

As the data surge continues to push the carriers to smaller cells, the backhaul issues are demanding more innovation. 

On the Verizon side, the company is gaining Apple customers but not in a way that Apple likes. A large portion of Verizon’s customers are choosing the iPhone 4. The good news for Verizon is the subsidy is much less. The bad news for Apple, is its pointing to the fact that Apple is being undercut even by its own products. That is one of the reasons the suppliers were given downward numbers for the iPhone 5.

If Apple moves down into the low end, the stock is a buy right now. If it does not, it’s still a hold. But particularly given the $900 price point on the Surface from Microsoft, Apple can play the margin for a while longer.