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AT&T Expects Mobile 5G Services in 'Late 2018'
http://www.lightreading.com/mobile/5g/atandt-expects-mobile-5g-services-in-late-2018/d/d-id/731164?
AT&T says that it could deliver initial mobile 5G services by late next year.
"We're preparing for the launch of standards-based mobile 5G as soon as late 2018," writes Andre Fuetsch, president of AT&T Labs and CTO, in a blog. Like many carriers, AT&T had initially been anticipating late 2019 or 2020 for the arrival of true mobile 5G services. (See AT&T Lays Out 5G Plans & More for 2017.)
Now that the 3rd Generation Partnership Project (3GPP) has accelerated the timetable for the 5G New Radio (NR) specification -- as Light Reading first reported would happen in September 2016 -- schedules for both fixed and mobile 5G have started to speed up too. (See 3GPP Approves Plans to Fast Track 5G NR.)
Want to know more about 5G? Check out our dedicated 5G content channel here on
Light Reading.
The accelerated schedule, which will see NR specifications frozen in December 2017, will support a "non-standalone" 5G standard that uses LTE to control the 5G data connections. Fuetsch writes that this will help speed up the development of standards-based mobile 5G too:
The accelerated schedule includes a plan to complete key components of the 5G standards needed to start chipset development in December 2017. That's 6 months ahead of the expected 3GPP full Release 15. These key components include the specifications for 5G NR along with the non-standalone option for the core network interface. The December 2017 standards milestone will unveil the first complete picture of a holistic 5G system, enabling hardware, chipset, and device manufacturers to start their development earlier. Operators, in turn, will be able to provide standards-based mobile 5G service sooner to customers, with many in the industry aiming for 2019.
The 3GPP Release 15 5G specification is expected to be completed in June 2018, including both standalone and non-standalone options. Release 16 5G, which lays out massive IoT, low-latency use cases and more, will follow in late 2019.
Fuetsch says that ahead of 5G services AT&T is planning "mobile-first" 5G trials in 2017. "In April we will start a second trial in Austin. The trial will allow residential and small-to-midsized business customers to stream DirecTV NOW and access next-gen entertainment and enhanced broadband services," Fuetsch says. (See AT&T Lab Tests DirecTV Now Over 5G.)
"Throughout this year and into next, you'll hear more about our plans for 5G fixed wireless," Fuetsch notes. Verizon, meanwhile, has started fixed 5G customer trials in 11 cities in the US and hopes to offer that service in 2018. (See Verizon Fixed 5G Tests to Top 3Gbit/s?)
— Dan Jones, Mobile Editor, Light Reading
First Net - Microwave/MM Wave Backhaul and Transmission?
If ATT has plans to utilize FIbertower's assets with the First Net Project then it is a slam dunk that the FCC will expedite and approve. I can't see an emergency network not having wireless/mm wave backhaul heavily in it versus hard fiber.
http://www.fiercewireless.com/tech/firstnet-ready-to-move-forward-awaits-court-s-decision
Short of a court’s decision on a protest filed by Rivada Mercury, FirstNet is ready to hit the ground running to deploy the nation’s first broadband network devoted to public safety.
At a board meeting Tuesday, FirstNet Chair Sue Swenson said the organization is waiting for an outcome from the U.S. Court of Appeals of Federal Claims and will be ready to take whatever steps are necessary based on the court’s decision.
“We’re ready and able to move forward,” as soon as it’s permissible to do so, she said. “We’re more ready than ever.”
Despite the award being tied up in court—Rivada Mercury argued in November that its exclusion from the competitive process was arbitrary and capricious—FirstNet was able to move forward on other fronts, which it clearly has done based on updates provided by department heads during the board meeting.
Shortly after Rivada filed its protest, AT&T—the likely winner of the FirstNet contract—filed a motion to intervene in the case, which was granted by the court. The briefing with the court concluded in February as scheduled and oral argument occurred on March 3, according to Jason Karp, general counsel at FirstNet.
“All steps relating to the protest” have been completed,” and it’s now with the court, Karp told the board. There was no injunctive order or temporary restraining order so FirstNet could move forward with activities short of making the actual award.
FirstNet will be prepared to react accordingly when it receives the court’s decision, which will happen “hopefully in the next several days,” Karp said.
For AT&T, getting the FirstNet business would mean a 25-year contract to use 20 megahertz of 700 MHz beachfront spectrum and $6.5 billion for designing and operating the nationwide network for federal, state and local authorities, with the right to sell excess capacity on the system.
RELATED: Editor's Corner—AT&T likely to win FirstNet, but delays could hurt
While FirstNet awaits the court’s ruling, FirstNet CEO Mike Poth delivered some good news in terms of the kind of support the endeavor can expect to receive from President Trump’s administration. FirstNet had the opportunity to provide a briefing to newly confirmed Secretary of Commerce Wilbur Ross on his second day on the job, and Ross expressed his commitment to make sure FirstNet is a success.
“The secretary of Commerce and this entire administration is very excited about FirstNet and has committed to do everything they can to continue to ensure its success,” Poth told the board. It’s so significant that Ross, in his first speech to all employees in the Commerce Department, identified FirstNet as one of his top three priorities.
That kind of support is refreshing for the FirstNet organization in its quest to provide a dedicated public safety network, which has been years in the making, and it hasn’t always been clear how the new administration would view the project.
For much of last year, FirstNet had indicated it wanted to make an award by the end of the year, but Poth announced in late October that FirstNet would continue to execute the acquisition process outlined in the RFP beyond the Nov. 1 target date. Poth promised Tuesday that the organization will be communicating with states and other stakeholders as soon as they learn the court’s decision.
It noted that a loss of the licenses would result in an immediate default in FiberTower’s right to use cash collateral, and that FiberTower’s ability
to reorganize would likely be doomed; thus, it said, the risk was ‘‘not speculative, theoretical, or remote.’’51 Moreover, it said that if the FCC cancelled the licenses, resulting in a failure of FiberTower’s reorganization, even a subsequent victory on appeal would require them to spend scarce resources, further jeopardizing their reorganization prospects.
And to this I offer the following perspective. How can you have a right to use cash collateral based off of an asset that you are valuing at $0?
Only if it some type of quid pro quo between he and Solus. All these behind the scenes players seem to know each other.
There is a strong case to be made when you have the spectrum assets under Tom Scott going from $300M to $2M in less than 2 years, Tom Scott as the CFO when $10M is not spent to preserve the licenses, Tom Scott doing the valuation, Tom Scott placing no value(Not One Dollar) on 700 licenses in contention with the FCC, and seeking Tom Scott to be some type of Trustee. The only other look at valuation had the unsecured going as high as $200M+ was from the unsecured creditors committee and they as well made the point that to place $0 value on the licenses in question is ludicrous.
Their plan to reorganize was never consummated with the 700 FCC licenses as a foundation. They have been in limbo before the the BK plan was confirmed. I think a decent BK lawyer can and will have a field day with this and I think ATT, The Debtors, and the FCC know it. So they can shoot themselves in the foot and give it away to ATT, go for market prices and cut the sharheolders in, or go for market prices and cut the shareholders out and risk continued litigation.
As previously noted, the Solus funds are beneficial holders of Loral common stock. They also hold most of the TSC Preferred Series B, one of the fulcrum securities in the case, as well as significant unsecured debt in other spectrum-rich companies – including Fibertower. The Swarts Claimants have also been invested in Fibertower stock for years, where we have been shareholders since before the 1:10 reverse split, solicited by Fibertower “management” on December 15, 2009. We currently hold 10,150 shares of Fibertower, which are deemed worthless in the current Fibertower POR. David Posner, of Otterbourg, Steindler, Houston & Rosen, negotiated this travesty of justice with the Fibertower debtors and represents Solus as counsel for
the Fibertower UCC. Mr. Posner is also the Terrestar Networks Liquidation “Trustee” and is one of the objectors to the instant Terrestar Swarts Claimants appeal. So, the reach of Solus is deep and almost always leads to the same outcome, vast riches for Solus and poverty for everyone below
them in the capital structure. It is clear now why Mr. Posner has treated me with such animus in the Terrestar hearings I attended.
$300M to $0 in less than 2 years / Conflict of Interests / Now could go for $500M+
Many of the same hedge funds are holding senior securities, issued by compliant managements who ignore their fiduciary duties to shareholders.
They are hard at work in all these companies – trying to get a lot of assets for very little – often paying pennies on the dollar for distressed debt. In all cases, many of the same hedge funds and other large corporate entities have used complicit advisors to undervalue the FCC and spectrum
assets of their respective companies.
http://www.terrestarinfo.com/pdflib/1158_15446.pdf
Re-Posting Summary of Events:
It is going to be very hard for Bondholders or Debtors to walk off with everything. Going through the documents it is still extremely foggy as to the status of the 691 Licenses that are going to trial with the FCC in 2019. The overlap with the parties involved in the following show complete conflicts of interest or a fair and equitable decision on the pending licenses.
If someone can correct me it still appears as if the 691 License are subject to the BK court and while the plan was approved it appear to leave major doors wide open
to contest the hell out of the plan.
Through 11/16/2011 - Licenses were carried on the balance sheet for close
to $300M. Little to no revenue being generated off these licenses. (Tom Scott was the CFO)
On 11/16/2011 – Fibertower misses interest payment. Wrote down the licenses to $106M. Little to no revenue being generated off these licenses. (Tom Scott was the CFO)
On 07/17/2012 - Fibertower files for Chapter 11. The success of the plan hinges on the Federal Communications Commission
signing off on the renewal of FiberTower's spectrum licenses for its 24-gigahertz and 39-GHz bands. The licenses were renewed on the condition that FiberTower make a "substantial service" showing by June 1, 2012, and the FCC will have to decide whether the substantial service threshold has been met, according to the filing. "During the pendency of these cases, the debtors and their professionals intend to continue working with the FCC to obtain a favorable decision as it is integral to the debtors' emergence from Chapter 11," FiberTower CEO Kurt Van Wagenen said in a declaration filed in bankruptcy court.
Fibertower elected not to spend $8 - $12M in protective/defensive links to warrant an extension of their rights to the licenses.(Tom Scott was the CFO) I am assuming that they had assurances from the FCC that their products, R&D, and existing backhaul business were more than sufficient to warrant another extension/renewal. Still little to no revenue being generated off these licenses. No clear indicator of why the FCC would have changed their minds if behind closed doors they gave Fibertower assurances the licenses would be renewed.
09/27/2013 - During Chapter 11 proceedings Tom Scott(Former CFO in control not spending the $8-$12M to preserve licenses) who was hired by the Debtors to value the business proposed that the entire company under a liquidation scenario was worth ~$7M and the licenses in a tug of war with the FCC were worth between $1 to $2 Million. So we have a plan that is a re-organization plan based on the renewal of the FCC licenses. These FCC licenses though are being valued under a liquidation scenario. So prior to 11/16/2011 the licenses are worth ~$300M, after 11/16/2011 up until Chapter 11 filings they are worth ~$106M, and then in BK they are worth $1 - $2M. The entire liquidation scenario of the company had assets of $112M being valued at $4 - $5M and the cash balance of $34M went straight to the 2016 Senior Note Holders.
This is where it is so preposterous and insane that I place a great deal of weight on the Bondholders owning a ton of the common shares
. The entire write down of the value from $306M to $1 $M in less than 2 years from Non Financial Duress, To Financial Duress, and then to BK Filing was oversaw by the same puppet clown(Tom Scott).
01/04/2014 – Unsecured creditors filed detailed objection to the Debtors Bankruptcy Plan based on valuation.
According to the Disclosure Statement, the Reorganized Debtors intend to continue the development and utilization of their 24 GHz and 39 GHz Spectrum Portfolio and will make its spectrum available for lease to other service providers. Currently, the Debtors own forty-nine (49) wide area licenses across both the 24 GHz and 39 GHZ bands (the “Partial Portfolio”). The Debtors are also engaged in an appeals process with the FCC for an additional 691 licenses that the FCC cancelled in November 2012 (together with the Partial Portfolio, the “Full Portfolio”). The financial projections set forth in the Disclosure Statement and which allegedly support the Debtors’ Plan account
for the continued legal expense of the appeals process and a go-forward business plan surrounding the 49 licenses that the Debtors still own. Neither the Plan nor the projections account
for the possibility that the Debtors’ appeal will be successful and that they retain some or all of the cancelled licenses.
The Plan Does Not Account
for the Value Associated with the Full Portfolio. 20. As noted above, the Debtors have been pursuing an appeal of the FCC’s decision to terminate 691 of the Debtors’ FCC Licenses. Indeed, the Debtors’ estates have been charged well over $1 million in fees by the law firms serving as the Debtors’ Special FCC Counsel to pursue the appeal. This is a convincing suggestion that the Debtors (and the 2016 Noteholders whose cash collateral is funding the appeal) believe that that there is a strong likelihood that the Debtors will be successful in having some or all of the FCC Licenses reinstated through litigation or settlement with the FCC. The Plan, however, does not contain any mechanism to adjust for the possibility that the Debtors will get back the Full Portfolio. Should the 2016 Noteholders be the sole beneficiary of all the additional value with respect to the reinstated licenses and still retain an $89.5 million deficiency claim if the appeal is successful? Absolutely not. The Debtors’ Plan cannot be confirmed without addressing this critical valuation issue. The Debtors and 2016 Noteholders have not shown that they are entitled to take all of the value of the Full Portfolio (assuming a successful appeal) and leave nothing behind for general unsecured creditors.
01/13/2014 – Debtors Response to Unsecured Creditor’s Objections. (Amazing how quickly they turned this one around)
Here is the key statement:
As described in the Scott Declaration, notwithstanding that the Debtors believe that they should be successful in the FCC Advocacy, the Debtors have to be realistic when taking into account
their chances of success. Taking into account
all of the circumstances, including that (i) the FCC has already ruled against the Debtors twice(in November 2012 and May 2013) and (ii)the press has reported that the FCC has internally circulated an Order denying the pending Petition for Reconsideration, the Debtors believe that it is highly uncertain if and when a final successful result may be achieved in the FCC Advocacy. After applying the “Expected Value” analysis (i.e.,applying the Debtors’ valuation of the Terminate Licenses against the uncertain cost, timing and probability of success), the Debtors believe that the net expected value for the Terminated Licenses is only marginally great than $0.
The conflict of interest on the valuation analysis.
Tom Scott was a puppet all along from CFO down to advising the debtors. Where was the impartiality?
The actual valuation analysis done by Tom Scott. Assets crater to near $0 from $300M+ in less than 2 years all done by the same person?
The valuation analysis done by the unsecured creditors was as high as $200M+
Did the debtors sandbag their appeals with the FCC the first few times knowing they had an ace in the hole to drag this thing out to get to the NPRM. The NPRM didn't just happen overnight and was planned well ahead of it's 10/22/2015 announcement.
03/31/2014 – Fibertower’s BK Plan is confirmed.
Around 04/07/2014 – Fibertower Common Shares
Extinguished and no longer trade.
FCC / Fibertower Legal Battle:
08/23/2012 – Fibertower files for injunctive relief to prevent the FCC from transferring the licenses to another party as it would completely upend Fibertower’s Plan of Re-Organization.
Around 05/09/2013 – FCC Rejects Fibertower’s Effort to keep the licenses.
Around 02/28/2014 – FCC Rejects Fibertower’s Efforts again to keep the licenses.
Around 04/06/2015 – DC Circuit court rules that the FCC committed errors in 42 of the 689 licenses and since those 42 are pertinent to the overall decision then the case can move forward.
Around 06/14/2016 – Court sets trial date on the status of the licenses for late 2019.
FCC NPRM on Millimeter Wave Spectrum Bands being used for Mobile Use:
10/22/2015 – FCC begins exploring and fact finding mission to have MM Wave Spectrum Bands used for Mobile Use and to be a foundation for 5G services.
07/16/2016 – FCC approves 39 ghz band for mobile use. Will continue to explore potential of 24 ghz. (Fibertower’s Bands are 24 and 39ghz)
Other Events:
02/22/2016 Verizon buys XO communications for Fiber Assets and option
to lease 28 ghz licenses as well as a small slice of 39 ghz.
07/16/2016 – FCC approves 39 ghz band for mobile use. Will continue to explore potential of 24 ghz. (Fibertower’s Bands are 24 and 39ghz)
Early 2017. FCC let’s StraighPath off the hook and simply fines them $100M or 20% of the sale price
of their company by the end of 2017.
02/01/2017 AT&T announces they are purchasing Fibertower for their existing assets and rights to all their 24 and 39 ghz licenses.
$600 - $700M sounds plausible. But then again it could be $400M or $1B. Have a hard time believing the floor isn't $500M.
AT&T likely to win FirstNet
Sounds like a lot of Millimeter Wave Spectrum will be needed.
http://www.fiercewireless.com/wireless/at-t-likely-to-win-firstnet-would-be-very-positive-for-towers-but-questions-remain
AT&T is likely to win the FirstNet contract in a move that would provide a significant lift to tower companies, according to analysts. But questions remain about just how much those tower companies stand to gain from the small cell market.
The nation’s second-largest wireless operator is widely considered the favorite to win the right to provide the nation’s first broadband network dedicated to public safety. FirstNet hasn’t officially announced anything yet, but ultimately that would give AT&T a 25-year contract to use 20 megahertz of 700 MHz beachfront spectrum and $6.5 billion for designing and operating the nationwide network for federal, state and local authorities, with the right to sell excess capacity on the system.
The award would be good news for tower-company investors who have recently grown concerned about potential consolidation in the U.S. wireless market.
“Consistent with our findings from MWC, it is clear to us towers are positioned to benefit from additional spend from AT&T related to FirstNet,” Jennifer Fritzsche of Wells Fargo Securities wrote in a research note as she upgraded the entire tower segment from "market weight" to "overweight." “Checks would suggest, if AT&T officially gets the FirstNet contract (which we see as very likely), AT&T has plans to touch over 40,000 towers (both new and existing) over the next five years. This would be more activity than the towers have seen from AT&T since 2014.
“If officially awarded FirstNet, we would not be surprised to see AT&T increase its 2017 capex plans,” Fritzsche continued. “Obviously, such a headline would be a very positive event for the tower sector.”
Crown Castle is particularly well positioned to benefit from an increase in AT&T’s tower investments, Fritzsche noted. Matthew Niknam of Deutsche Bank agreed, although he warned that such an increase largely wouldn’t occur until next year.
“Crown Castle noted it has yet to see acceleration in tower leasing activity (this is embedded in guidance), with carriers facing capital constraints and upcoming spectrum catalysts largely built into their ‘normal’ ~$30 billion annual capex spend,” Niknam wrote. “However, Crown Castle noted FirstNet may be an exception to this, as external financing may drive spending levels higher. Furthermore, if AT&T wins the FirstNet award, Crown Castle noted it would be well positioned, given its legacy AT&T tower portfolio. That said, Crown Castle views FirstNet to be more of a 2018 story.”
Crown Castle is also poised to see its significant investments in small cells pay off as carriers increasingly look to densify their networks and ramp up capacity, analysts said. But SBA Communications is taking a more conservative view of the small cell market, Niknam wrote in a separate research note.
“While small cells will certainly play a greater role in wireless, SBA continues to question the returns here relative to its core macro business,” according to Niknam, “especially around incremental economics associated with second/multiple tenancies.”
There is 99% chance the Fibertower acquisition has the blessing of the FCC. The thing is how do you structure it so that all walk away content and they have zero issues going forward. If one of the groups feels slighted then it could potentially hold the deal and effective use of the licenses up. We are talking about 2017 - 2025 where AT&T is looking at $100B+ in revenues and the FCC / Trump Administration is looking to make it's mark with a strong vibrant economy of which 5G will be a critical piece. The FCC wants the lion's share of the MM wave bands approved for mobile use in the hand of ATT, Verizon, and some viable other parties. But ATT and Verizon are going to be the first ones busting down the doors.
Old Bondholders $100M
Unsecured Creditors $30M
New Fibertower(Old Bondholders) $???
Common Shareholders $???
Miscellaneuos / Legal $???
I would content their will be piece for the common shareholders that should be in the area of make then happy and go away.
I don't think any of those other cases were as egregious as this one. This one(and I am biased) is so far over the top with Tom Scott's involvement from Stability of the Company to the Debtors getting final confirmation of their plan...and as others have noted not consummation of the plan. I still believe the bondholders are heavily hedged with common shares. The price of the common, tax write offs etc...would have had major funds unloading all their shares and maybe this board has at most 8 - 10% of the common.
49 Licenses they had and 698 Licenses in contention essentially valued at $300M+ to $106M+ to $1M to $2M all in the course of 2 years all under the same person?
A guy who can be held liable for poor fiduciary duty or at least informing plaintiffs of who was pulling the strings not to spend the $8 to $12M is going to provide the court guidance as to the value of the spectrum holdings?
The kicker is the development of a trust and to have Tom Scott administer the assets and be relieved of culpability? Are you kidding?
I am guessing something went wrong with what they thought they had in hand with the FCC but they also knew the MM Wave Bands were progressing and would eventually be approved for mobile use. It is not as if on 10/22/2015 the FCC drafted a major proposal soliciting opinions and information regarding the MM Wave bands for mobile use. There was years leading up to that announcement where discussions would have been swirling.
It is going to be very hard for Bondholders or Debtors to walk off with everything. Going through the documents it is still extremely foggy as to the status of the 691 Licenses that are going to trial with the FCC in 2019. The overlap with the parties involved in the following show complete conflicts of interest or a fair and equitable decision on the pending licenses.
If someone can correct me it still appears as if the 691 License are subject to the BK court and while the plan was approved it appear to leave major doors wide open to contest the hell out of the plan.
Through 11/16/2011 - Licenses were carried on the balance sheet for close to $300M. Little to no revenue being generated off these licenses. (Tom Scott was the CFO)
On 11/16/2011 – Fibertower misses interest payment. Wrote down the licenses to $106M. Little to no revenue being generated off these licenses. (Tom Scott was the CFO)
On 07/17/2012 - Fibertower files for Chapter 11. The success of the plan hinges on the Federal Communications Commission signing off on the renewal of FiberTower's spectrum licenses for its 24-gigahertz and 39-GHz bands. The licenses were renewed on the condition that FiberTower make a "substantial service" showing by June 1, 2012, and the FCC will have to decide whether the substantial service threshold has been met, according to the filing. "During the pendency of these cases, the debtors and their professionals intend to continue working with the FCC to obtain a favorable decision as it is integral to the debtors' emergence from Chapter 11," FiberTower CEO Kurt Van Wagenen said in a declaration filed in bankruptcy court.
Fibertower elected not to spend $8 - $12M in protective/defensive links to warrant an extension of their rights to the licenses.(Tom Scott was the CFO) I am assuming that they had assurances from the FCC that their products, R&D, and existing backhaul business were more than sufficient to warrant another extension/renewal. Still little to no revenue being generated off these licenses. No clear indicator of why the FCC would have changed their minds if behind closed doors they gave Fibertower assurances the licenses would be renewed.
09/27/2013 - During Chapter 11 proceedings Tom Scott(Former CFO in control not spending the $8-$12M to preserve licenses) who was hired by the Debtors to value the business proposed that the entire company under a liquidation scenario was worth ~$7M and the licenses in a tug of war with the FCC were worth between $1 to $2 Million. So we have a plan that is a re-organization plan based on the renewal of the FCC licenses. These FCC licenses though are being valued under a liquidation scenario. So prior to 11/16/2011 the licenses are worth ~$300M, after 11/16/2011 up until Chapter 11 filings they are worth ~$106M, and then in BK they are worth $1 - $2M. The entire liquidation scenario of the company had assets of $112M being valued at $4 - $5M and the cash balance of $34M went straight to the 2016 Senior Note Holders.
This is where it is so preposterous and insane that I place a great deal of weight on the Bondholders owning a ton of the common shares. The entire write down of the value from $306M to $1-$M in less than 2 years from Non Financial Duress, To Financial Duress, and then to BK Filing was oversaw by the same puppet clown(Tom Scott).
01/04/2014 – Unsecured creditors filed detailed objection to the Debtors Bankruptcy Plan based on valuation.
According to the Disclosure Statement, the Reorganized Debtors intend to continue the development and utilization of their 24 GHz and 39 GHz Spectrum Portfolio and will make its spectrum available for lease to other service providers. Currently, the Debtors own forty-nine (49) wide area licenses across both the 24 GHz and 39 GHZ bands (the “Partial Portfolio”). The Debtors are also engaged in an appeals process with the FCC for an additional 691 licenses that the FCC cancelled in November 2012 (together with the Partial Portfolio, the “Full Portfolio”). The financial projections set forth in the Disclosure Statement and which allegedly support the Debtors’ Plan account for the continued legal expense of the appeals process and a go-forward business plan surrounding the 49 licenses that the Debtors still own. Neither the Plan nor the projections account for the possibility that the Debtors’ appeal will be successful and that they retain some or all of the cancelled licenses.
The Plan Does Not Account for the Value Associated with the Full Portfolio. 20. As noted above, the Debtors have been pursuing an appeal of the FCC’s decision to terminate 691 of the Debtors’ FCC Licenses. Indeed, the Debtors’ estates have been charged well over $1 million in fees by the law firms serving as the Debtors’ Special FCC Counsel to pursue the appeal. This is a convincing suggestion that the Debtors (and the 2016 Noteholders whose cash collateral is funding the appeal) believe that that there is a strong likelihood that the Debtors will be successful in having some or all of the FCC Licenses reinstated through litigation or settlement with the FCC. The Plan, however, does not contain any mechanism to adjust for the possibility that the Debtors will get back the Full Portfolio. Should the 2016 Noteholders be the sole beneficiary of all the additional value with respect to the reinstated licenses and still retain an $89.5 million deficiency claim if the appeal is successful? Absolutely not. The Debtors’ Plan cannot be confirmed without addressing this critical valuation issue. The Debtors and 2016 Noteholders have not shown that they are entitled to take all of the value of the Full Portfolio (assuming a successful appeal) and leave nothing behind for general unsecured creditors.
01/13/2014 – Debtors Response to Unsecured Creditor’s Objections. (Amazing how quickly they turned this one around)
Here is the key statement:
As described in the Scott Declaration, notwithstanding that the Debtors believe that they should be successful in the FCC Advocacy, the Debtors have to be realistic when taking into account their chances of success. Taking into account all of the circumstances, including that (i) the FCC has already ruled against the Debtors twice(in November 2012 and May 2013) and (ii)the press has reported that the FCC has internally circulated an Order denying the pending Petition for Reconsideration, the Debtors believe that it is highly uncertain if and when a final successful result may be achieved in the FCC Advocacy. After applying the “Expected Value” analysis (i.e.,applying the Debtors’ valuation of the Terminate Licenses against the uncertain cost, timing and probability of success), the Debtors believe that the net expected value for the Terminated Licenses is only marginally great than $0.
The conflict of interest on the valuation analysis.
Tom Scott was a puppet all along from CFO down to advising the debtors. Where was the impartiality?
The actual valuation analysis done by Tom Scott. Assets crater to near $0 from $300M+ in less than 2 years all done by the same person?
The valuation analysis done by the unsecured creditors was as high as $200M+
Did the debtors sandbag their appeals with the FCC the first few times knowing they had an ace in the hole to drag this thing out to get to the NPRM. The NPRM didn't just happen overnight and was planned well ahead of it's 10/22/2015 announcement.
03/31/2014 – Fibertower’s BK Plan is confirmed.
Around 04/07/2014 – Fibertower Common Shares Extinguished and no longer trade.
FCC / Fibertower Legal Battle:
08/23/2012 – Fibertower files for injunctive relief to prevent the FCC from transferring the licenses to another party as it would completely upend Fibertower’s Plan of Re-Organization.
Around 05/09/2013 – FCC Rejects Fibertower’s Effort to keep the licenses.
Around 02/28/2014 – FCC Rejects Fibertower’s Efforts again to keep the licenses.
Around 04/06/2015 – DC Circuit court rules that the FCC committed errors in 42 of the 689 licenses and since those 42 are pertinent to the overall decision then the case can move forward.
Around 06/14/2016 – Court sets trial date on the status of the licenses for late 2019.
FCC NPRM on Millimeter Wave Spectrum Bands being used for Mobile Use:
10/22/2015 – FCC begins exploring and fact finding mission to have MM Wave Spectrum Bands used for Mobile Use and to be a foundation for 5G services.
07/16/2016 – FCC approves 39 ghz band for mobile use. Will continue to explore potential of 24 ghz. (Fibertower’s Bands are 24 and 39ghz)
Other Events:
02/22/2016 Verizon buys XO communications for Fiber Assets and option to lease 28 ghz licenses as well as a small slice of 39 ghz.
07/16/2016 – FCC approves 39 ghz band for mobile use. Will continue to explore potential of 24 ghz. (Fibertower’s Bands are 24 and 39ghz)
Early 2017. FCC let’s StraighPath off the hook and simply fines them $100M or 20% of the sale price of their company by the end of 2017.
02/01/2017 AT&T announces they are purchasing Fibertower for their existing assets and rights to all their 24 and 39 ghz licenses.
11 U.S. Code § 1101
2) “substantial consummation” means—
(A) transfer of all or substantially all of the property proposed by the plan to be transferred;
(B) assumption by the debtor or by the successor to the debtor under the plan of the business or of the management of all or substantially all of the property dealt with by the plan; and
(C) commencement of distribution under the plan.
After the Confirmation Date and prior to substantial consummation (as defined in section 1101(2) of the Bankruptcy Code) of the Plan, the Debtors (with the consent of the Ad Hoc 2016 Committee) may, under section 1127(b) of the Bankruptcy Code, institute proceedings in the Bankruptcy Court to remedy any defect or omission or to reconcile any inconsistencies in the Plan, the Disclosure Statement approved with respect to the Plan, or the Confirmation Order, and such matters as may be necessary to carry out the purpose and effect of the Plan so long as such proceedings do not adversely affect the treatment of Holders of Claims against or Interests in the Debtors under the Plan; provided, however, that, to the extent required, prior notice of such proceedings shall be served in accordance with the Bankruptcy Rules or an order of the Bankruptcy Court. A Holder of a Claim or Interest that has accepted the Plan shall be deemed to have accepted the Plan, as altered, amended, modified or clarified, if the proposed alteration, amendment, modification or clarification does not materially and adversely change the treatment of the Claim or Interest of such Holder. In the event of any dispute as to whether such proposed alteration, amendment, modification, or clarification materially and adversely changes the treatment of the Claim or Interest of any such Holder, the Debtors, shall bear the burden of demonstrating that such proposed alteration, amendment, modification, or clarification does not materially adversely change the treatment of the Claim or Interest of such Holder.
At 8M shares and a 16% stake in the common Samberg has between $50M and $100M+ reasons to be paying attention to and have his finger on the pulse of Fibertower. Considering he bought up 6% of StraightPath back in 07/2016 you know he is well aware of what is going on in the current environment.
Ownership of Common, Form 13, % of ownership:
Form: / Filing Date: / Party: / Share Count: / % Owned
Form 13 / 2/14/2013 / Solus / 7805996 / 15.68%
Form 13 / 2/12/2013 / Arthur Samberg / 8127317 / 16.3%
Chapter 11 Voluntary Petition / 7/17/2012 / Fibertower / Listed as > 5% Owner / Listed as > 5% Owner
Chapter 11 Voluntary Petition / 7/17/2012 / Crown Castle / Listed as > 5% Owner / Listed as > 5% Owner
Chapter 11 Voluntary Petition / 7/17/2012 / Solus / Listed as > 5% Owner / Listed as > 5% Owner
Chapter 11 Voluntary Petition / 7/17/2012 / Arthur Samberg / Listed as > 5% Owner / Listed as > 5% Owner
Form 13 / 2/2/2012 / Pennisula Capital Advisors / 0 / 0
Form 13 / 11/18/2011 / Pennisula Capital Advisors / 4970000 / 9.98%
Form 13 / 7/8/2011 / Blackrock / 1548945 / 3.12%
Form 13 / 5/31/2011 / Arthur Samberg / 6283630 / 12.65%
Form 13 / 4/19/2011 / Zazove Associates LLC / 2282758 / 4.57%
Form 13 / 3/16/2011 / Arthur Samberg / 3046716 / 6.1%
Form 13 / 2/14/2011 / Solus / 10135201 / 20.28%
Form 13 / 2/14/2011 / OZ Management / 0 / 0
Form 13 / 1/18/2011 / Aspen Advisors / 972539 / 1.95%
Form 13 / 1/10/2011 / Blackrock / 5403161 / 10.81%
Form 13 / 7/8/2011 / Blackrock / 4708509 / 10.28%
Form 13 / 6/29/2010 / Pennisula Investment Partners / 6830000 / 14.9%
Form 13 / 6/4/2010 / Arthur Samberg / 2808280 / 6.13%
Form 13 / 3/18/2010 / Pennisula Investment Partners / 2500000 / 5.46%
Form 13 / 2/19/2010 / Vanguard Group / 778934 / 1.78%
Form 13 / 2/18/2010 / Aristeia Capital, L.L.C / 974855 / 2.133%
***Note that Arthur Samberg was still buying after Chapter 11 filed and he has be active recently in StraighPath in the past year reporting a 6% ownership stake in STRP in 07/2016.
There appear to be obvious flaws in how this was done and a re-opening of the case with the AT&T sale will have no impact on the reorganized entity at all. The flaws or technicalities that a skilled law firm could run with on this are countless.
Assets weren't just undervalued....they were assigned no value.
The assets were assigned a zero liquidation value yet the debtors were willing to spend millions to keep the asset in good standing with the FCC? There has to be some value assigned to the asset yet they went with $0?
Some licenses were pre-effective date estate some were not.
And yes the debtors using Tom Scott the Former CFO to do the valuation and administer a trust that relieved former officers of responsibility?
Does anyone else on here think that an offer will be put forth to the Common in order to appease us and make us go away? It would be a lowball offer but it is a starting point.
The 691 Licenses were not even a factor in the go-forward plan of Fibertower. Zero Value assigned to them when the unsecured came up with $200M+.
I am having a hard time getting my head around the 692 licenses being terminated at the time of BK, not a factor in the BK valuation and assigned $0 value,
Essentially the Debtors did not even have possession of the assets at the consummation of the plan but the petition to return the licenses was began pre-bk.
If I look at the criteria of the following:
A challenge to a confirmed plan is presumed to be equitably moot once a debtor's plan of reorganization has been substantially consummated. Looking to Section 1101(2) of the Bankruptcy Code, the court stated that a plan is considered substantially consummated when:
(1) all or substantially all of the proposed property transfers in a plan have taken place;
(2) the successor company has assumed the business or management of the property dealt with by the plan; and
(3) the distributions established in a plan have commenced.
Number 1 is questionable and arguable.
Number 2 is questionable and arguable.
Number 3 is questionable and arguable.
The court also recognized, however, that the presumption of mootness can be rebutted by satisfaction of a five-factor test under the U.S. Court of Appeals for the Second Circuit's precedent:
(1) the court can still order some effective relief;
(2) such relief will not affect the re-emergence of the debtor as a revitalized corporate entity;
(3) such relief will not unravel intricate transactions so as to knock the props out from under the authorization for every transaction that has taken place and create an unmanageable, uncontrollable situation for the bankruptcy court;
(4) the parties that would be adversely affected by the modification have notice of the challenge; and
(5) the challenging party pursued with diligence all available remedies to obtain a stay of execution of the objectionable order.
Number 1 is a yes
Number 2 is a yes
Number 3 is a yes
Number 4 would have to happen
Number 5 is ???
There are many time points and variables to this where it appears and argument can be made that not only do the Common and the Unsecured get to share in the proceeds of the deal but that the Debtors committed borderline fraud or at the very least deceived the court room by assigning a zero value to the licenses during the BK process. How do you assign a value to the near 50 licenses but the near 700 licenses you are fighting over get no valuation and there is essentially no determination or response of the court? How do you assign 3 licenses in limbo to the Pre-Effective Date Estates yet the 691 just seem to go poof?
Keep the discussion going. This is helpful as what appears to me to be fraud, misrepresentation, and deception by the debtors and irresponsibility of the court I just am no legal expert. Is there still a chance if they strike a deal for the rights of those 691 licenses that the court will readdress or is that an impossibility without someone taking action?
Thanks Condoe3.
Was just about to post after doing some reading. Could one make the argument similar to the Unsecured Creditors that the Plan was seriously flawed based on the fact that they quickly said the 3 licenses which had some value yet were immaterial are part of the "Pre-Effective Date Estates" yet the 691 Licenses to which they assigned zero value to in the plan?
It seems to me that the Debtors and AT&T want as smooth a transaction as possible yet if this were put before the court it appears that the Debtors actions were borderline fraudulent in assigning zero value to the 691 just a few years back and now they are worth hundreds of millions? In the unsecured creditors document contesting the plan they stated that the debtors had spent $1M in legal fees at that time trying to get the licenses back from the FCC. Also you have many conflicts of interest with Thomas Scott doing a valuation analysis. He was part of the crew that didn't spend the capital to keep the licenses.
We all agree this stinks to high heaven but as I and others have stated you most likely have some significant shareholders out there waiting in the wings along with the unsecured creditors who's attorneys have to be licking their chops at this point.
On one hand you are telling us the licenses aren't worth anything and you are quick to give up the 3 to the pre-effective date estates but yet a few short years later those very same licenses you say are worthless are fetching $500M+.
So you have a few scenarios:
1 - The Debtholders construct a deal where the common are completely shut out which will no doubt lead to a fight and contest the BK plan. Not something AT&T or the FCC wants.
2 - The transaction goes off and the common receive their just portion of the proceeds which is significant upside.
3 - The Debtholders and AT&T construct a deal that essentially pays off the common to go away. This would be in their best interest as the Debtholders get paid, Debtholders don't get exposed, AT&T gets spectrum quickly, and FCC gets the spectrum in the right well funded hands.
Condoe, I understand what you are trying to say but I am not seeing it from what I am reading in the docs.
You can make the argument that there is ambiguity there but I ask you to go to Doc 1078 and Page 4:
13. In accordance with the terms of the Plan, the Confirmation Order and Section 1124(b) of the Bankruptcy Code, the Debtors submit that and amendment to the Plan is warranted under the present circumstances. The FCC has approved the assignment of substantially all of the FCC Licnenses to Reorganized Fibertower Spectrum and such Approved Licenses constitute the bulk of the value attributable to the FCC Licenses. As described above, however, it is arguable that the Effective Date cannot occur unless the FCC rules with respect to all of the FCC Licenses.
In response to this doc the judge saying that "Notwithstanding the terms of the Plan and the Confirmatio Order the Pending Licenses shall remain property of the Debtors' pre-Effective Date Estates upon the occurrence of the Effective Date of the Plan.
To me that back and forth is heavily tilted towards the judges decision applying to ALL THE PENDING LICENSES, ALL 691, and not just 3.
80B+ Mhz Pops in Top 20 Markets.
110B+ Mhz Pops in Top 50 Markets.
That is an old calculation based off of one of their annual reports from 6-8 years ago. Numbers have gone up since then. Overall I would estimate the number to be close to 140B+ Mhz Pops.
All of this is factoring in all the spectrum both what they have and what is in contention.
Listen to codesilver. He didn't just fall off the turnip truck.
Shows you just how lazy media and analysts are. I have not seen one article since the announcement of AT&T buying Fibertower addressing what Fibertower once was, their battle with the FCC, and their potential spectrum holdings. And these are Wireless, Telecom, Finance, and Technology related websites. A quick google search and reading the 3 postings on "commlawblog.com" would give you far more information on the history of Fibertower, The Licenses, and their battle with the FCC than what has been put out their since Feb 1st.
Facts are Fibertower has control of nearly 25% of the 39ghz spectrum in the country and nearly all of the 24ghz spectrum. The 24ghz spectrum which has not been approved for mobile applications just yet still holds immense value as it can been used for countless point to point applications including backhaul and fixed wireless.
If you factor in the spectrum in limbo with the FCC Fibertower essentially controls not 10, not 20, not 30 but hundreds of billions of mhz pops. My assumption is AT&T wants the entire lot of licenses, Fibertower knew that, and Ajit Pai and the new FCC will be more than happy to comply with the deal.
https://wireless2.fcc.gov/UlsEntry/attachments/attachmentViewRD.jsp?applType=search&fileKey=676952455&attachmentKey=20088668&attachmentInd=applAttach
This will give you all you need to know about AT&T's intentions. They want it all and they want it now. You can thank CodeSilver for finding this from the FCC website I assume. Any time CodeSilver posts something which is usually a link, read it. He finds lots of nuggets and details that I often don't see or find. This is a thorough explanation of AT&T's intentions.
The one thing I find strange in all of this is there still isn't a price tag out there. Verizon kept there XO Spectrum piece of the deal clouded and the ATT/Fibertower deal has been kept very clouded for nearly 3 weeks now.
I think you are over analyzing a lot but that is my opinion. I think the BK Judge decision on Pending Licenses being part of post effective date estates means 100% Old Fibertower meaning 100% chance the common is in the pie for the AT&T purchase.
AT&T bought everything. 100% of what Fibertower currently has or what was in dispute with the FCC. AT&T wanted it now and they were most likely willing to pay to get it done and has the FCC debate if any all settled. Ajit Pai is huge proponent of ATT and VZ and all that they do and can do.
I don't believe AT&T got a bargain basement price as the FCC would have some influence there in that they want $100M or 20% from the STRP sale and they have additional spectrum to auction from the current NPRM and for future MM bands that they may open up. The FCC does want to free up spectrum for 5G but they don't want it going for rot gut prices as they have a responsibility to the treasury and setting the bar higher on the onset it good for them.
I do believe there are large holders of the common out there that overlap with the bond/debt holders of the $132M Notes. What I found interesting in all of the BK documents from the BMC website is I could not get a handle on what institutions or individuals comprised the bond/debt holders. Appeared all secretive. We know Pucillo is in there heavy but who else. Have to believe with the way things unfolded that he is also a huge holder of common shares.
*Unsecured Claims $4M
*2012 Notes $30M
*Senior Notes $132M
*Cash extracted during BK by Senior Notes $34M
*Balance $132M
Assets in the Equation:
*Non License Assets, developed pre and post effective date.
*88 Active Licenses in 24/39 ghz bands(46 never in question, 42 given back per Courts based on Substantial Service)
*650 Pending Licenses in 24/39 ghz bands
*What value is placed on the 46 licenses in providing recovery on the $132M? This never really happened during BK. Value now is far greater than 2013/2014.
*What value is placed on the 42 licenses in providing recovery on the $132M? Are these part of the pre-effective estate? Value now is far greater than 2014/2015.
*What value is placed on the 650 pending licenses? These are 100% part of the pre-effective date of BK estate.
*The only valuation ever placed on the entire lot of 700+ licenses was by Thomas Scott and that was $4-$5M and was a try on handing everything straight to the Note Holders and calling it a day. Seemed criminal then and seems even more criminal now that we have seen this play out this far.
*Just trying to get a sense of what pieces and what value are placed on those pieces in satisfying the $132M.
*I agree that if the Noteholders hedged their bets which I assume is true because you could buy common shares for $.02 to $.05 for the longest time and there were days of near no activity and days of heavyy acitvity after BK and before final cancellation.
Then they would have all the incentive in the world to drive as high a price as possible for the company. It seems as if there is a large block totally unaccounted for. Solus is in, Samberg is in, Crown Castle?, Block of Average Joes like us?
Do I think the New Fibertower can try and pull off some type of screw job on the common shareholders? Yes. But with this huge a spotlight now and the valuations going up the opposition to such an attempt will be met with severe litigation. Hedging positions by the noteholders buying up the common will mitigate that risk to a certain extent. I am assuming a decent price could be commanded from AT&T for everything including the 650 licenses in question as they can almost be guaranteed that the FCC will relent on their case and free them up for commercial use.
Trump selects Pai to replace Wheeler.
http://www.reuters.com/article/us-usa-trump-fcc-idUSKBN1542QP
Kerrisdale Conference Call to Explain their short position on StraightPath. It doesn't go very well for Kerrisdale. Well worth listening to.
http://www.webcaster4.com/Player/Index?webcastId=19400&uid=3543074&g=717ab593-28c4-46a9-ba77-7f32d1953463&sid=
Agreed. Right now the barometer to use is StraightPath. And that measurement has me saying Fibertower's licenses are worth somewhere in the area of $600M. Closest and most accurate comparison I think there is in the marketplace.
Fortunately we had a judge that appeared to sniff out what they were trying to do.
Fortunately now there is a huge spotlight on MM Wave spectrum versus 2012 when they started BK proceedings.
It didn't seem like it back then but the stars all aligned with the BK Judge, The Debtor's Shenanigans, The FCC Cancellation, and now the court case getting extended out to 2019 which unless a settlement is reached will have those licenses sitting idle while countless companies want to get their hands on them.
I still think the debt holders loaded up on the common between the 2012 declaration of BK and the 2014 final cancellation of the shares in order to obtain as much of the final pie as possible out of the final outcome. 48M shares...Samberg...Crown Castle...Solus....Average Joes....there was a huge piece of the pie lefts after those are accounted for and it probably traded upwards of 2-3X the 48M over those last couple of years leading up to the cancellation.
(3)Pending licenses shall remain property of Debtors' pre-Effective Date Estates and subject to the continuing jurisdiction of the Bankruptcy Court pending the FCC's determination of the transfer application with respect there to.
The debt holders could have always hedged their position by buying up the common shares at sub $.05 prices as the price stayed there for what seemed like over a year. 48M shares were outstanding and it seemed logical that they would have accumulated as much as they could in order to hedge against the judge sniffing out what they were trying to do and that was completely low ball the spectrum and pass it over to themselves.
48M shares and at last check I think Samberg owned 7-8%, Crown Castle 3-5%, Solus 5% etc....lots of room for the debt holders to be buying up shares on the cheap to protect themselves.
Comparison of StraightPath and Fibertower:
*Straightpath has small 28 ghz holdings and has 735 39 ghz licenses. (They had 931 Licenses, Forfeited 193 Licenses in Top 40 Markets where they had more than 600/700 Mhz)
*On the hook for $15M and then another $85M which can be suspended if the sale of the company/licenses goes through in next 12 months and then must remit 20% of sale to FCC/Treasury.
*Straightpath Current Market Cap as of Friday Close after the announcement on Thursday and Conference Call on Friday is $490M
*$490M Market Cap incorporates the $15M Fine and the $85M Fine or the 20% of asset sale. That implies an overall value to the current company of ~$590 - $600M before the fines/potential treasury payment.
*Do a comparable to Fibertower. This includes all licenses including those in litigation.
179 24 ghz licenses
635 39 ghz licenses
*When you compare Straightpath’s 28ghz holdings to Fibertower's 24 ghz holdings it is safe to say the 24 ghz of Fibertower probably has greater value due to the extent of the nationwide holdings. In the 39 ghz band Fibertower has 635 Licenses to StraightPath's 735 Licenses. So let's say we are in the ballpark of an apples to apples valuation of ~$600M.
*Market Value $600M
Fibertower Bond Holders $175M
Unsecured Creditors $50M
Misc $25M
Balance of $350M or $7.29 per share for the common…ballpark estimate.
*I think the key here is that the FCC was willing to make a deal so quickly with StraightPath and wants that spectrum out in the marketplace and put to use. If you compare the actions of StraightPath and Fibertower, hands down Straightpath was a spectrum squatter and very brazen for many years.
Fibertower went out and built a viable backhaul business, developed products to utilize their spectrum(Spectrum in a Box), worked hand and hand with the FCC, and was assured by someone at the FCC that they would gain a extension/waiver of buildout requirements based on all their work until it was pulled out from under them at the last minute.
*Compare that to Straightpath who can't tell anyone if they had functioning equipment at sites or not when they filed their renewals. After their investigation they basically claimed ignorance and that they had no idea. With Straightpath where were the Checks and Balances, Paperwork, Systems etc…there should have been something in place.
*It appeared like ignorance that bordered on defrauding the FCC and they essentially still get to retain 80% of their holdings because the FCC wants the spectrum out in the marketplace.
*Fibertower's potential court case won't get going until 2019 which means no one can touch the spectrum until then.
I sense a similar deal coming for Fibertower and possibly a better one provided the new administration, new commissioner who will possibly be PAI who is largely pro-business and free market.
*It is like night and day the contributions and efforts of Straightpath vs. Fibertower and Straightpath is coming out of this smelling like a rose. Should bode well for Fibertower.
Looking Good for Fibertower to get Spectrum Back Soon:
“Burdensome regulations”
Many Republicans see Wheeler’s tenure as one of “burdensome regulations” and are only too eager to start the process of undoing all his work, or “rolling it back” as they like to say. Just when we thought we had a period of stability and certainty (isn’t that what the industry has long been calling for?), it’s all about to come crashing down. Yet again, the only financial winners will be the lawyers.
Yet Rosenworcel is not your typical dyed in the wool Democrat, and has challenged party policy on telecoms in the past – most recently with the set-top box bill, another of Wheeler’s initiatives that will now never come to pass.
But despite her refreshing independence at times, she was a supporter of net neutrality, which is more than can be said of wannabe chairman Pai (who will also most likely be installed as interim chairman, being the longest serving of the two republican commissioners). Pai is not exactly a supporter of net neutrality.
During the presidential campaign, Trump called net neutrality a "top down power grab" and "Obama's attack on the Internet." Mind you, Trump said a lot of things during his campaign… But it’s now odds on that net neutrality policies and broadband reclassification will be back on the agenda for a total rethink. We can think of several large US telcos that will be rubbing their hands with glee this morning.
“It would be disingenuous to suggest that we did not have significant differences with the direction the FCC took under Chairman Wheeler," said Bob Quinn, AT&T’s senior EVP of external and legislative affairs, in statement to Politico. Still, it’s never a good idea to kick a man when he’s down, and so in this season of goodwill to all, there’s time for some friendly comments: "Following [his] illustrious career, and when most people would have hung up their spikes, he chose to enter public service where he was a dedicated and tireless advocate.”
Exclusive: Verizon Dishes Everything You Want to Know About Its Pre-Commercial 5G Trials
https://www.wirelessweek.com/news/2016/12/exclusive-verizon-dishes-everything-you-want-know-about-its-pre-commercial-5g-trials
However, just because Verizon is sticking with 28 GHz for now, that doesn’t mean that will always be the case.
“I expect our process will evolve to stay really tightly aligned with the FCC’s actions in this space,” Koeppe said. “So, logically, moving from 28 (GHz) to 37 (GHz) to 39 (GHz) and then whatever comes next.”
Verizon is notorious within the industry for being tight-lipped about its plans, but the carrier on Friday opened up about its upcoming pre-commercial 5G trials in an interview with Wireless Week. And yes, they shared pretty much everything you want to know.
The setup
Deeper Insights
All Things LTE
According to Adam Koeppe, Verizon’s vice president of network technology planning, the carrier’s pre-commercial fixed wireless 5G trials will encompass a “few hundred” 5G radio nodes in around 10 different locations across the country. Those locations will include those in the four states previously unearthed in FCC filings, as well as several other locations utilizing spectrum from the XO Communications transaction. Several of the node locations will overlap with existing 4G LTE node locations, he said.
Koeppe explained the 5G radio nodes will provide enough coverage to blanket several thousand homes, but noted the carrier only expects the number of users in the trial to be in the “mid-hundreds.” Within the node footprint, Koeppe said Verizon will proactively go into the user community and ask for volunteers to participate in the trial. Those who elect to participate will receive prototype devices that will allow them to access the Internet via the 5G radio connection and go ahead with whatever over-the-top consumption they want to do over that connection.
Verizon is targeting a diverse set of users in these trials, Koeppe said, including residential, commercial, and retail users. Koeppe noted the number of participants will be limited by the amount of experiment equipment Verizon has to use for the tests, which will be supplied by Nokia, Ericsson, and Samsung. But within the test group Koeppe said Verizon is also planning to incorporate diverse receiver/transceiver setups with distances ranging anywhere from 100 feet to 6,000 feet and with varying population levels, geography, and obstructions.
“Probably the most important thing here is we’re moving out of the very controlled field technical trials we had done earlier in the year,” Koeppe said. “It’s a meaningful pre-commercial phase. We’re past the one-off use cases, so this is very much focused on an actual deployable product so that we can prove the viability of the solution … While the propagation characteristics of these spectrum bands are well knonw – they’ve been used for quite some time now – in the real world environment we want to then prove out, you know, what impact does foliage have, what impact does home construction have … the ability to provide a home broadband experience with a reliable service offering.”
The spectrum
As mentioned in the FCC filings, Koeppe confirmed the tests will utilize 28 GHz spectrum. And he said there are a few good reasons the carrier has landed on that band out of the others being considered and utilized in 5G testing by both itself and other carriers.
According to Koeppe, the 28 GHz band landed at the top of Verizon’s list first because of two obvious factors: the FCC’s recent decision to open that swath alongside 37 GHz and 39 GHz for licensed 5G use and the carrier’s deal with XO Communications that gave it the ability to lease 28 GHz spectrum in multiple markets around the country.
But Koeppe also said the band was favored because some of Verizon’s technical partners were already at work building 28 GHz-capable equipment for the upcoming 2018 Olympic games in Asia.
However, just because Verizon is sticking with 28 GHz for now, that doesn’t mean that will always be the case.
“I expect our process will evolve to stay really tightly aligned with the FCC’s actions in this space,” Koeppe said. “So, logically, moving from 28 (GHz) to 37 (GHz) to 39 (GHz) and then whatever comes next.”
The timeline
Koeppe indicated Verizon expects to spend the majority of the next year proving the viability of its fixed wireless solution, with the bulk of the testing conducted between the beginning and middle of the year. As the trials proceed throughout 2017, he said, Verizon may extend or expand its testing. Right now, though, there is no finite date for the end of the trials, he said.
What about fully mobile 5G?
Not yet – but Verizon will be ready when the standards are.
“The pre-commercial stage for us is absolutely focused on fixed wireless,” Koeppe said. “If you think a little more broadly outside of the fixed wireless work we’re doing right now and look forward to the multitude of technical advancements that will be 5G, having mobility in that equation while also having millimeter wave spectrum in that equation is going to require a very tight tie to 4G LTE-Advanced. There’s work to do certainly within the standards bodies, there’s work to do on the technical front to really define that and make that work – and we’re a part of that process, obviously. I would expect that sometime during 2017 that process will evolve and then if there’s a way to fit mobility testing into what we’re doing, we’ll be able to do so pretty easily.”
If Trump administration axes Net Neutrality and deals blow to FCC
Huge win for Fibertower and their rationale in their case for retaining their licenses.
Netflix, Google, Amazon, Facebook etc....will look for increased capacity to deliver their premium content as well.
Why Liberty Media's John Malone thinks cable and wireless networks are destined to consolidate
http://www.cnbc.com/2016/11/16/john-malone-thinks-cable-and-wireless-networks-are-destined-to-consolidate.html
As cable and wireless companies become more dependent on each other, one media mogul says he feels positive that much larger consolidation is ahead for the industry.
"I don't know who buys who, or who starts what. But I know from my experience in Europe and Latin America that there's big synergies in combining the two networks," Liberty Media Chairman John Malone told CNBC at the company's annual Investor Meeting last week.
Malone is referring to his international cable business, Liberty Global, acquiring internet provider Virgin Media for $23.3 billion in 2013. The move expanded Liberty into Europe's largest cable market with nearly 80 percent of revenue post-deal coming from the UK, Germany, Belgium, Switzerland and the Netherlands. Since that deal, Liberty has entered into agreements in Ireland and Austria to expand its reach even further.
Those agreements, known as mobile virtual network operator agreements — or MVNO's — allow a cable provider to essentially rent a specified amount of capacity from a wireless operator and that it then re-sells to its customers. Such arrangements allow cable companies to add to their list of services without building out their own wireless infrastructure.
Perhaps not surprisingly, this arrangement actually benefits both the MVNO, or cable operator, as well as the wireless operator. The MVNO can provide more attractive services to its customers, and the wireless operator can increase its market share without spending marketing dollars to attract customers.
Back in July, NBCUniversal's parent company, Comcast, confirmed plans to launch its own MVNO cellular service by mid-2017 in a deal with Verizon. Like most MVNO agreements, there are strict limits on how Comcast can repackage Verizon's service, and in this case, Comcast can only sell its wireless offering within a bundle of other services. (CNBC is a unit of NBCUniversal and Comcast.)
Malone, however, said he believes that it's more likely that consolidation will take place among wireless and cable providers, rather than cable companies launching their own wireless networks.
"At some point, the [wireless] network that's supplying that to you is unhappy with you becoming a full competitor on their capital assets. And you start to get squeezed. You also don't have the ability to innovate services, because you're essentially a reseller of their service," he said.
Malone pointed to further and more aggressive relationships between cable and wireless companies as a solution to that problem.
"It's fine for Charter and Comcast to go down the MVNO road for a while, particular in the [business-to-business] world, because they have a great relationship with Verizon, which is the best technology network," he said. "So you can start that way, but my belief is they will have to have a much deeper relationship with Verizon in the long run to make that work."
Other analysts believe that with the advent of 5G fixed wireless service in the coming years, MVNO agreements could be seen as a good defensive play for cable providers. As wireless providers get 5G into households, potentially supporting broadband, then cable providers could still offer comparable packages for wireless, VoIP phone, video and high-speed internet.
Verizon CEO Francis Shammo echoed this sentiment during Verizon's third-quarter earnings call.
"If you look at the future and you think about the [capacity-boosting] projects that we have going on, and then you look at the whole 5G world for fixed wireless, that's going to enter into a whole new growth trajectory for the entire industry," he said. "We'll respond where we need to respond, and we'll wait to see what happens."
Why Verizon Communications Inc’s XO Acquisition Is A Game-Changer For VZ Stock
https://bnlfinance.com/2016/11/19/verizon-communications-inc-xo-acquisition-game-changer-vz-stock/
When a $200 billion company makes a $1.88 billion acquisition, investors don’t expect it to be a “game-changer” for the stock. However, that’s exactly what XO Communications could mean for Verizon Communications Inc (NYSE:VZ) and VZ stock. The reason lies in why Verizon competitors tried so hard to prevent the acquisition, and specifically, what DISH Network Corp (NASDAQ:DISH) said in a petition to the FCC.
XO Communications was previously Carl Icahn’s spectrum asset and fiber business, covering 40 major U.S. markets with 1.2 million fiber miles. The acquisition deepens Verizon’s Ethernet penetration to fixed-line customers and could limit what VZ pays to fiber providers as it deploys small cells.
But more importantly, the purchase gives Verizon access to XO’s 102 LMDS spectrum licenses in 28 GHz and 39 GHz. In other words, it is very good bands of spectrum that Verizon can use to conduct 5G tests and soon deploy the technology.
Therefore, DISH, who owns a large band of AWS4 spectrum, petitioned the XO acquisition. In a statement DISH not only confirmed why the XO acquisition is so important for VZ stock, but how it gives Verizon a huge edge over the competition.
The two transactions would place Verizon, one of the two largest mobile phone carriers in the nation, in control of resources — specifically XO’s fiber network and Nextlink’s local multipoint distribution service (LMDS) and 39 GHz spectrum — that promise to play central roles in 5G applications and hence will be important to the companies competing against Verizon in the commercial mobile radio service 5G marketplace
Just as important, the transactions will eliminate current and potential competition between Verizon and XO in the mobile backhaul (both wireless and fiber), Internet transit, and enterprise and wholesale markets.
Remember, Verizon was already head-and-shoulders above all others in 5G, and 5G is going to be just as disruptive to 4G as 4G was to 3G. How XO Communications is a game-changer for Verizon
Not only has VZ already demonstrated wireless speeds of 3.7 Gbps, far faster than Google Fiber’s 1 Gbps, but with 5G Verizon will successfully blur the lines of wireless and broadband internet by removing the wires and delivering the fastest connection speeds imaginable to both wireless and wireline customers. This is the future, and XO has fiber connections in 45 of the top 50 U.S. markets.
With that said, 5G is clearly a huge opportunity for VZ, and the acquisition of XO gives it a huge boost to commercializing the network. According to DISH, XO Communication’s LMDS frequencies are the “next frontier” airwaves for 5G, and it “will be almost exclusively controlled by Verizon” now that the acquisition has been approved by the FCC.
Needless to say, Verizon’s acquisition of XO Communications is a game-changer for both the company and VZ stock, and honestly, I am shocked the FCC approved it.