The AT&T logo is seen at their store in Times Square in New York
The AT&T logo is seen at their store in Times Square in New York. Reuters

Telecom bellwether AT&T Inc. (NYSE:T) announced its acquisition of wireless spectrum from chipmaker Qualcomm Inc. (NASDAQ: QCOM) for $1.925 billion to strengthen its advanced 4G mobile broadband offering.

The second-largest US mobile-phone carrier agreed to purchase spectrum licenses in the lower 700 megahertz frequency band from Qualcomm. The spectrum covers 300 million people in the United States.

Qualcomm initially acquired the spectrum, which allows subscribers to watch TV on cell phones, for its Flo TV unit. The unit will shut down in March 2011, as part of Qualcomm's restructuring plan.

AT&T, which competes with Verizon Wireless, plans to deploy this spectrum as supplemental downlink, using carrier aggregation technology, as part of its longer-term 4G network plans.

Qualcomm said it is integrating carrier aggregation technology in its chipsets and plans to develop LTE multicast technologies that can support high-bandwidth video and multimedia content.

Unpaired spectrum bands can be made available for wireless operators to use in conjunction with existing paired bands to obtain substantial improvements in their mobile broadband networks.

The companies expect the sale to close during the second half of calendar year 2011.

Shares of AT&T were trading up 20 cents at $29.41 Monday on the NYSE in premarket trade, while Qualcomm shares were up 29 cents at $49.75 on Nasdaq.