Spectrum Swap 'n' Shop

Last year, with the formation of two megacarriers - Verizon Wireless and Cingular - other deals seemed puny by comparison, even Verizon's acquisition of Price Communications for $1.5 billion in stock and a $500 million debt assumption. Yet, not just the top two have been busy buying, selling and trading spectrum. Can you name some of the other carriers playing "Let's Make a Deal?"

Q: Which wireless carrier in the past year has announced deals to add more than 17 million POPs by acquiring 44 licenses including some from less-known companies such as DCR PCS, Radio-fone PCS and ClearComm?

A: Leap Wireless currently owns or has rights to acquire licenses covering about 48 million potential customers in 32 states. This includes an agreement with CenturyTel for 7 million POPs in Indiana, Michigan, Minnesota and Wisconsin.

Among the more interesting deals is one where Leap is acquiring eight licenses that once belonged to DCR PCS, a subsidiary of Pocket Communications. At one time, Leap had an agreement to purchase 12 licenses from DCR PCS, but this agreement was subject to overbid in an auction held pursuant to the U.S. Bankruptcy Code. Cook Inlet subsequently received the licenses in the auction and now has agreed to sell eight of them to Leap.

Once Cook Inlet closes the purchase of licenses from DCR PCS, Leap will receive a $4.2 million break-up fee from Pocket because of the original terminated agreement between Leap and DCR PCS.

Q: Although they may not always agree with one another on technology, which two sets of Top 10 carriers managed to agree on spectrum to exchange?

A: Cingular and VoiceStream announced a swap of licenses consisting of 35 million POPs each. Cingular gets 10MHz of spectrum each for the New York MTA and the Detroit and St. Louis BTAs. VoiceStream gets 10MHz of spectrum in each of the Los Angeles and San Francisco MTAs.

AT&T Wireless and Sprint PCS also announced an agreement to swap "certain blocks of 10MHz PCS spectrum" amounting to 18.5 million POPs each. Neither company is talking about where the spectrum is located, although Sprint said it would increase spectrum to 20MHz in markets where it previously held only 10MHz. AT&T wasn't giving any hints.

Q: What original C-block PCS license holder is expanding its wireless holdings through deals with AT&T and PrimeCo?

A: CFW Communications, an integrated communications carrier, currently offers PCS in Virginia and West Virginia. Earlier this year it acquired PrimeCo's PCS licenses in the Richmond and Norfolk BTAs and then announced an agreement to purchase AT&T spectrum in southern and central Pennsylvania. CFW also has interests in PCS licenses in Kentucky, North Carolina, Ohio and Tennessee.

Q: What carrier divested itself of licenses in the Southwest in order to concentrate on clusters in other parts of the United States and the Caribbean?

A: Centennial Communications netted more than $202 million in its sale of RSAs near Yuma, AZ, and Imperial, CA, to Western Wireless. It currently has about 664,000 wireless customers in the United States and in the Dominican Republic, Jamaica, Puerto Rico and the U.S. Virgin Islands.

Q: What communications company formed five operating divisions following a 3-way trade completed mid-year?

A: Alltel exchanged wireless properties in 13 states with Bell Atlantic and GTE, gaining about 14 million POPs and about 750 net customers.

Other deals included a $400 million purchase of properties in Louisiana from SBC and the sale of PCS licenses to Tritel, Cellular South and, most recently, to Verizon Wireless. The Verizon deal, to close this year, consists of 20 licenses involving 11.4 million POPs in six states.