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3.5 GHz Wireless Broadband Service Gains Momentum

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Major U.S. telecom operators are currently exploring ways to commercialize usage of 3.5 GHz unlicensed wireless spectrum. Notably, the 3.5 GHz radio frequency is being considered in many parts of the world for the upcoming 5G wireless standard, thus increasing its chances of providing spectrum globally.

Verizon Communications Inc. (VZ - Free Report) is planning to deploy small cells – both low power and high power – using the 3.5 GHz band. T-Mobile US Inc. (TMUS - Free Report) applied to the Federal Communications Commission (FCC) for an experimental radio license to test 3.5GHz equipment in Washington State. Meanwhile, in Mar 2017, the FCC awarded AT&T Inc. (T - Free Report) a license to test a 3.5GHz network. Sprint Corp. (S - Free Report) is also likely to join the bandwagon.

AT&T, T-Mobile US and Sprint currently carry a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In Aug 2016, several leading tech giants formed an alliance -- Citizens Broadband Radio Services (CBRS) -- to explore low-cost ways to provide wireless service using unlicensed 3.5GHz band. Notable among them are Google of Alphabet Inc., Qualcomm, Intel, Ericsson and Nokia. In practice, CBRS alliance works toward defining standards that would allow wireless carriers, enterprises, venue owners and others to deploy 4G LTE networks in the 3.5 GHz band.

The increase in adoption of small cells is because of the inconvenience of installing large towers in inaccessible areas. Verizon stated that the small cells will be used to augment its existing 4G LTE and upcoming 5G network and will primarily concentrate on high traffic locations like a business district or shopping mall. Small cells will increase voice capacity and data speeds as well as complement wireless service provider’s LTE infrastructure. Using small cells in unlicensed 3.5 GHz band will thus significantly reduce cost of operations for the wireless operators. 

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