T-Mobile Buying 700 MHz Spectrum Covering Chicago From AT&T Subsidiary

T-Mobile is buying 700 MHz spectrum from AT&T's Leap Licenseco covering 10.9 million people in the Chicago metro area, T-Mobile said Wednesday. The FCC must approve the deal. "T-Mobile will have 700MHz A-block spectrum that covers all of the top 10 US markets and is capable of covering 269 million Americans -- or 83 percent of the US population -- with Extended Range LTE,” T-Mobile said in a news release. T-Mobile said it has executed 23 different agreements to add A-block spectrum since it bought its first 700 MHz A-block spectrum form Verizon two years ago. “We already cover 309 million people with our blazing-fast LTE network, and now, T-Mobile Extended Range LTE will be in the 10 biggest markets in the country,” said CEO John Legere. “We won’t stop there.” BTIG analyst Walter Piecyk said the deal shows the intrinsic value of low-band spectrum. "Despite the threat of the incentive auction looming in the coming months and T-Mobile effectively being the ONLY real buyer for this spectrum, the seller was able to hold out for $420 million ($3.21/MHz/POP), which was more than twice the value paid for this license back in 2011," Piecyk wrote investors. "This underscores the intrinsic value of spectrum and why operators pay up to gain access to needed network coverage and capacity even when simply negotiating with a counter-party spectrum owner who does not intend to build [out] their license."