It’s “too early to tell” how Verizon will...

It’s “too early to tell” how Verizon will split its budget for the upcoming AWS-3 and broadcast incentive auctions, but its top priority is the AWS-3 auction, said Chief Financial Officer Fran Shammo Thursday during a conference call with investors. The AWS-3 auction is to occur at the end of 2014, with license attainment during Q1 2015. Once the AWS-3 auction is complete, “then we'll deal with the broadcast licenses after that within 2015,” Shammo said. Verizon is currently using its existing AWS spectrum to increase capacity for its 4G LTE network. Those AWS deployments have mainly been concentrated in major urban markets like New York, San Francisco and Chicago, but it plans to deploy AWS spectrum in smaller cities and rural markets throughout the rest of the year, Shammo said. “The network performance is delivering what we expect it to,” he said. Verizon ended the quarter with a net $3.95 billion profit on $30.8 billion in revenue, driven in part by its successful $130 billion buyout of Vodafone’s 45 percent of Verizon Wireless in February (CD Feb 24 p22). Verizon added a net 539,000 postpaid wireless customers during Q1, having added a net 634,000 subscribers on tablets, but lost a net 138,000 postpaid subscribers using cellphones. AT&T said Tuesday it added a net 625,000 postpaid mobile subscribers during the quarter. Verizon’s net loss of cellphone subscribers -- the first quarter that’s happened since 2010 -- “is a shocking turnaround,” said MoffettNathanson analyst Craig Moffett in a blog post. “Verizon has topped AT&T for post-paid net additions every quarter since they got the iPhone. Not this time.” Verizon began offering the iPhone in 2011. AT&T’s response to competition from T-Mobile and its improved network performance has put Verizon “in a tough spot,” said New Street Research analyst Jonathan Chaplin in a note to investors. “Verizon is faced with either losing share or cutting price, at least until AWS deployment drives improved network performance for a large portion of the sub base."