SoftBank Deal for Sprint Turns on Spectrum

SoftBank’s acquisition of Sprint Nextel would likely give the Japanese company effective control over two U.S. wireless carriers that hold rights to coveted airwave spectrum, adding to the appeal of the $20 billion deal.

Telecom carriers are fighting over spectrum because of the explosive demand for mobile data and the need to build faster networks to accommodate smartphones. Airwaves for wireless signals are controlled by the government, and are licensed by telecom carriers and broadcasters. How much spectrum access a carrier has can determine its coverage, service quality and, ultimately, its competitiveness. The battle over spectrum has been a factor behind recent telecom deals in the U.S. and globally. Softbank's deeper ties with Clearwire through Sprint could speed construction in the U.S. of a type of 4G network called TD-LTE, which is compatible with the technology Softbank is using for some of its 4G mobile services in Japan.