Is This the Beginning of a New Era for T-Mobile?

The Federal Communications Commission finally approved on Wednesday a spectrum transfer from AT&T (NYSE:T) to T-Mobile, part of a breakup fee the former promised to pay the latter should antitrust authorities reject its proposed buyout offer, which they did late last year. The larger carrier will transfer spectrum to T-Mobile in 128 cellular market areas, including 12 of the top 20 markets in the country.

T-Mobile, which has separately been petitioning the FCC to block spectrum purchases by the country’s biggest carrier Verizon Wireless (NYSE:VZ), will use this latest windfall to help it carry out its 4G investment plans. The company, which runs its 4G network on a HSPA+ 42 system, is hoping to make the move to the faster LTE by next year, and is planning to spend $4 billion on it. Both Verizon and AT&T use LTE for their respective 4G networks.

T-Mobile has also been trying to stop Verizon from making its planned $3.6 billion purchase of Advanced Wireless Services airwaves from cable companies including Comcast (NASDAQ:CMCSA) and Time Warner (NYSE:TWC). It has filed a petition with the FCC, saying Verizon was under-utilizing segments it already owns and that the deal was potentially anti-competitive. Verizon recently sold off some of its holdings in the lower 700MHz band of the spectrum in its attempts to convince the FCC to let it buy new spectrum.