AT&T, Inc. (NYSE: T) will buy about $2.5 billion in wireless airwaves from the privately held Aloha Partners, according to the nation's largest wireless carrier. The additional airwaves will give AT&T 72 of the top 100 markets for wireless service in the 700 Megahertz radio spectrum, with a potential of serving 196 million customers in 281 markets.This is probably an effort to head off pressure from Google, Inc. (NASDAQ: GOOG), which has expressed pretty strong interest in the same radio spectrum as part of its plan to create a new way of providing wireless services to customers. The idea is to allow customers to buy any device designed for that radio spectrum and use it on any carrier that wishes to provide service. Right now, U.S. wireless carriers have a death grip on the wireless handset market and frequently lock customers into their own networks, shoddy phones and all.
Aloha was planning on rolling out a mobile television service using those airwaves and was in testing in the Las Vegas area, but apparently the AT&T offer was too tasty. What is unknown now is if AT&T will participate in the upcoming 700 Megahertz airwave auction that Google wants to dominate (if certain conditions are met).
Did AT&T just do an end-run around Google? In a sense, yes. But there is more at stake here, and Google's war chest of cash is in prime position to challenge any and all established telecom companies as it tries to re-invent the rules of how communication happens.
Why do we have a weak dollar?
Holiday hiring slow for retailers
Closing Bell: What sell-off? (AIG, ABK, EPR, MBI, JAVA, ORCL, ERTS)
