AT&T (T) Seeks FCC Permission For 5G Trial Using 3.5GHz

AT&T Inc. (NYSE:T) recently requested for Special Temporary Authority (STA) from the Federal Communications Commission (FCC) to conduct 5G tests on the 3.5 GHz frequency band.

AT&T plans to conduct tests for one month, commencing from Feb 1, 2018, using Ericsson’s (NASDAQ:ERIC) equipment inside a closed building in Washington, D.C. The 5G wireless link will be established between the base station and mobile user equipment (UE) located in the same room or area. The base station and UE will operate within about 3 meters above floor level in the building. An internet service provider will provide internet access for the purposes of the 5G demonstration using various applications and web servers.

However, AT&T is awaiting final guidelines from the FCC. The FCC is considering new rules for the 3.5 GHz Citizens Broadband Radio Service (CBRS) band.

In August 2016, several leading tech giants formed an alliance — Citizens Broadband Radio Services (CBRS) — to explore low-cost ways for providing wireless service through unlicensed 3.5GHz band. Notable among them are Google of Alphabet (NASDAQ:GOOGL) Inc., Qualcomm (NASDAQ:QCOM), Intel (NASDAQ:INTC), Ericsson (BS:ERICAs) and Nokia (HE:NOKIA). In practice, CBRS works toward defining standards that will enable wireless carriers, enterprises, venue owners and others deploy 4G LTE networks in the 3.5 GHz band.

Earlier, major U.S. telecom operators commercialized the 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, raising scope of providing spectrum globally.

Verizon Communications Inc (NYSE:VZ) deployed both low- and high-power small cells using the 3.5 GHz band. T-Mobile US Inc. (NYSE:T) applied for an experimental radio license from the FCC to test 3.5 GHz equipment in Washington State. Meanwhile, in March 2017, the FCC awarded AT&T a license to test a 3.5 GHz network.

In May 2017, United States Cellular Corp submitted an application to the FCC for a six-month special temporary authority to conduct trial runs in the 3.5 GHz band in some areas of Maine and North Carolina.

Bottom Line

Notably, the 3^rd Generation Partnership Project (3GPP) has recently ratified the Non-Standalone (NSA) 5G New Radio (NR) specification. Completion of the first 5G NR standard has set the stage for the global mobile industry to start full-scale development of 5G NR for large-scale trials and commercial deployments in 2019.

On Dec 18, AT&T initiated its largest 5G fixed wireless trial in Waco, TX, partnering with the home and lifestyle brand Magnolia. The company claims it to be the largest trial in terms of mobile traffic. This is in sync with its plan to offer standard-based mobile 5G services to consumers from late 2018.

In August 2017, AT&T announced the expansion of 5G technology trials to three new cities — Waco, TX; Kalamazoo, MI; and South Bend, IN — by the year end. In December 2016, AT&T already initiated next-gen 5G technology trials in partnership with Ericsson using the millimeter wavelength technology in Austin, TX.

AT&T’s closest rival, Verizon announced plans to launch next-generation 5G wireless residential broadband services in three to five U.S. markets in 2018. The first commercial launch is scheduled in Sacramento, CA, in the second half of 2018.

Zacks Rank & Price Performance

Currently, AT&T carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

AT&T portrays an impressive price performance. In the past month, shares of AT&T have gained 10.6% compared with the industry’s rally of 8.9%.

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