With the mobile industry facing a dearth of wireless frequencies, mobile carriers in US may want to merge. However, the industry could be restricted by regulatory uncertainty and this issue is expected to be discussed in the yearly gathering next week. Wireless operators in US are facing issues of a volley of competitors fighting over the market and they are yet to deal with several services that are demanding higher bandwidth.
Unlike operators, regulators are not in favor of mergers. Operators, post evaluation, are willing to take a chance with the spectrum they can use as long as they have an idea of the spectrum that could be introduced in the market in the future.
Regulators are expected to soon announce their final review of the Verizon Wireless spectrum deal. Meanwhile, AT&T has openly expressed their issues with shortage of spectrum ever since regulators decided to buy T-Mobile, their rival, in 2011. However, AT&T had to suffer quarterly losses worth $6.7 billion on account of the break-up package they had to offer T-Mobile, impacting their position in the market. This has set an example for all service providers to exercise caution before entering into big acquisitions. The US presidential elections coming up in November are expected to provide clarity on the regulatory landscape.
The issue at hand is a spectrum crisis. Regulators support the existence of four national wireless providers to sustain healthy competition. They want to see the merger of Sprint Nextel with T-mobile and MetroPCS Communications with Leap Wireless. Though spectrum deals should be easier to achieve in theory, the review of the Verizon Wireless deal does not provide clarity on the amount of spectrum up for purchase. T-Mobile would like to buy the Verizon Wireless spectrum, including Comcast. However, they are unlikely to buy airwaves from Clearwire.
While Dish Network is waiting for permission from FCC to utilize its spectrum for cellular services only, keeping satellite services aside, the FCC is expected to come up with clearer limits regarding ownership of spectrum. This will be a deciding factor on the spectrum owned by Verizon and AT&T.
Vendors are being encouraged to opt for technologies that help in improving the management of the capacity of the wireless networks that exist, while simultaneously trying to manage the growth in demand for higher bandwidth. The conference will also see the issue of mobile payments being discussed as representatives of MasterCard and Visa will deliver speeches.
