NextWave looking to sell U.S. spectrum

[TNDan21]

NextWave looking to sell U.S. spectrum
Company hires investment bankers to explore options
By Dan Meyer


Stop me if you’ve heard this one before: NextWave Wireless Inc. said today it’s exploring the sale of its U.S. spectrum holdings.

The company made its mark on wireless in the mid-90s by being the top bidder for extensive 1.9 GHz spectrum covering most of the country, then filing for bankruptcy protection after failing to pay for the winnings, and finally selling off most of the spectrum to Cingular Wireless L.L.C., MetroPCS Communications Inc. and Verizon Wireless.

NextWave used proceeds from the spectrum sale to enter a number of businesses, including the WiMAX chipset market, as well as again boosting its spectrum holdings through acquisitions and Federal Communications Commission auctions.

Today, NextWave said it hired Deutsche Bank and UBS Investments to explore the sale of its current spectrum portfolio.

According to NextWave, that current portfolio includes 154 licenses in the 1.7/2.1 GHz band that it acquired during 2006’s advanced wireless services auction, 30 licenses in the 2.3 GHz band and 22 licenses in the 2.5 GHz band. In total, NextWave said the portfolio covers 251 million potential customers.

The news sent NextWave’s stock skyrocketing more than 25% in early Thursday trading to around $6 per share.

NextWave’s CEO Allen Salmasi noted in a press release that, following the recently completed 700 MHz spectrum auction, the company has received “multiple offers for our U.S. spectrum assets.”

Salmasi added: “Given our continued success in developing highly differentiated wireless broadband and multimedia-enabled products, we no longer view our spectrum holdings as critical to reaching our product sales objectives, and believe that now is the perfect time for us to sell these valuable assets while network operators are trying to finalize their band plans and spectrum holdings for their continuing 3G and planned 4G rollouts.”

NextWave did not put a price tag on its for-sale spectrum.

During this month’s CTIA Wireless 2008 trade show, Salmasi talked extensively about the company’s plans for its chip business as well as its moves into WiMAX technology and mobile entertainment. NextWave also recently joined some infrastructure heavyweights in an agreement to work on licensing intellectual property rights for Long Term Evolution technology.

NextWave looking to sell U.S. spectrum - RCR Wireless News

[SmArTeStChIlD421]

so who needs spectrum......if Google was just trying to activate the open access measures in that auction that means someone else could have the spectrum.....T-Mobile wouldnt want it......they have nationwide licenses......Sprint could use it but they'll get more spectrum when they turn over the 800 SMR spectrum from Nextel.....who really needs it is the question

[Eric47]

i have a feeling that cricket or metro might want it. i cant think of anyone else that really needs spectrum badly right now. att might want the AWS as they didnt get alot in that auction, but those other 2.3/2.5's, that will probably goto a prepad company imthinking.

[RJB]

I think more so than anyone Alltel would want to jump on board.

[RJB]

Originally Posted by SmArTeStChIlD421

so who needs spectrum......if Google was just trying to activate the open access measures in that auction that means someone else could have the spectrum.....T-Mobile wouldnt want it......they have nationwide licenses......Sprint could use it but they'll get more spectrum when they turn over the 800 SMR spectrum from Nextel.....who really needs it is the question

Well I think any carrier no matter if they have a nationwide liceanse would like to have this. The more the population and customers you have the more spectrum you need to keep up with the demand.

[blsemp]

NextWave should not even be in business. They defaulted on their original purchase of frequencies from the FCC but by filling bankrupcy they were allowed to keep them.

I feel like that is a glitch in the law. If you don't pay you don't stay.

[Mobile Mike]

Originally Posted by RJB

I think more so than anyone Alltel would want to jump on board.

It would be interesting if they went for it. It would finally give them a national footprint (of sorts). I just wonder if the price is right?

[SmArTeStChIlD421]

oh believe that from all the things i have heard about Alltel (good things i might add) it would be the right price for everyone

[RJB]

Originally Posted by SmArTeStChIlD421

oh believe that from all the things i have heard about Alltel (good things i might add) it would be the right price for everyone

Yeah alltel is great from what I see.

[Dogma]

I'd be surpised to see Alltel make a push for the spectrum, due to it being such a high frequency. Alltel currently has 1900 PCS licenses that they don't even use as we speak. I wish they would turn those markets up, rather than site on them as license holding markets. I hope I'm wrong though, as I'd love to see Alltel make a push to be a more national carrier.

I'm thinking MetroPCS and Cricket will go after this NextWave spectrum if it adds coverage area for them.

[Eric47]

the way Alltel is stagnating is not good from a growth perspective. their gross ads are getting better, but still not significant enough after backing out their churn. TBH, i dont think that they need to worry about spectrum, they need to develop a plan for growth. being everyones goto roaming partner has been successful for them, but it does not generate revenue quite the same way that a post paid customer will. hence why ATT and Verizon try to keep themselves from being heavily dependant on it and go after the new lines.

if i was working for them, first thing i would do is simplify the plans and get back to basics....new customers....spectrum can be had at anytime, no sense in diving in for stuff you dont need as the above guy said.

[Dogma]

Originally Posted by Eric47

the way Alltel is stagnating is not good from a growth perspective. their gross ads are getting better, but still not significant enough after backing out their churn. TBH, i dont think that they need to worry about spectrum, they need to develop a plan for growth. being everyones goto roaming partner has been successful for them, but it does not generate revenue quite the same way that a post paid customer will. hence why ATT and Verizon try to keep themselves from being heavily dependant on it and go after the new lines.

if i was working for them, first thing i would do is simplify the plans and get back to basics....new customers....spectrum can be had at anytime, no sense in diving in for stuff you dont need as the above guy said.

I'm not sure what you define as "stagnating" for Alltel? Alltel had record cutomer growth over the last year, low churn as compared to any other carrier and high rankings in the latest JD Power & Assoc ranking for call quality. Their data ARPU has also steadily increased.

Alltel does need to add spectrum in markets they currently do not serve in order to go national, or buy out some smaller carriers (USCC, etc.).

ALLTEL Q4 2007
Alltel Corp., now a privately owned company following its $27.5 billion acquisition by private-equity firms, reported notable customer additions during the fourth quarter, numbers that made 2007 a record for the company in terms of subscriber gains.

The carrier beat out Wall Street predictions, adding more than 1 million gross customers during the quarter. Alltel’s net customer additions were 342,684 during the fourth quarter, marking a 50% increase from the year-ago period. On the year, it added 3.6 million gross customers and netted 965,831, a 51% increase from the previous year.

Churn dropped to 1.81% during the quarter, making it the eighth consecutive quarter the carrier has improved its customer-exodus measurement. Year-end churn dropped to 1.79%.

Average revenue per user (ARPU) reached $54.49 during the quarter while data revenue per user averages surged to $6.74, a 63% increase from a year ago. ARPU for the full year hit $54.30 while data revenues evened out at $5.87.

[ctk74]

Originally Posted by Dogma

I'm not sure what you define as "stagnating" for Alltel? Alltel had record cutomer growth over the last year, low churn as compared to any other carrier and high rankings in the latest JD Power & Assoc ranking for call quality. Their data ARPU has also steadily increased.

Not quite. Verizon is still the best of the national carriers:

The turnover rate rose to 1.18% from 1.08% a year earlier.

[Eric47]

yea alltels churn would be 3rd among the big 5. behind verizon and att. then sprint than t-mobile.

[Dogma]

Originally Posted by ctk74

Not quite. Verizon is still the best of the national carriers:

The turnover rate rose to 1.18% from 1.08% a year earlier.

I'm not stating Alltel's churn is the best, just saying its not bad and in line with many other carriers.

[SmArTeStChIlD421]

think of the customer growth if they really did go national....jeez

[strunke]

Yeah Alltel needs to do something. They are growing fine now. But that might not continue just because of the lack of new markets. They need to get these or buy sprint, or buy uscc, metro pcs, cricket. The plans are good though, i think if they simplify them it will only limit customers options, especially since the National Freedom plans are pretty much the equivalent to everything else the other carriers are offering. If they don't P/E's ROI is going to be laughable.

[Mobile Mike]

Originally Posted by SmArTeStChIlD421

think of the customer growth if they really did go national....jeez

I can imagine it would be substantial, but I also wonder how it would affect the pricing of their plans. Being a smaller carriers allows them to offer more advantageous plans than the big guys. If they were to level the playing field, on a national level, I wonder whether they would keep their current pricing strategy (and for that matter, their roaming pacts)?

[SmArTeStChIlD421]

Originally Posted by Mobile Mike

I can imagine it would be substantial, but I also wonder how it would affect the pricing of their plans. Being a smaller carriers allows them to offer more advantageous plans than the big guys. If they were to level the playing field, on a national level, I wonder whether they would keep their current pricing strategy (and for that matter, their roaming pacts)?

kinda like T-Mobile.....

[Mobile Mike]

Originally Posted by SmArTeStChIlD421

kinda like T-Mobile.....

T-Mobile 5 years ago, yes. It certainly wouldn't hurt Alltel.