Verizon-cable companies spectrum sale

Verizon Wireless offered to sell some unused airwaves in exchange for federal approval of its purchase of other airwaves from cable companies. Verizon said it would sell some spectrum licenses in the 700 megahertz band that it bought at a federal auction in 2008 during which the Federal Communications Commission placed "open access" requirements on the spectrum.

T-Mobile questioned Verizon's need for more airwaves in a blog post and urged the Federal Communications Commission (FCC) to block the company's planned deal with a coalition of cable companies.

Sen. Al Franken (D-MN) said that small companies have told him they fear that if they publicly oppose Verizon's proposed deal with a coalition of cables, they will suffer retribution.

Verizon Communications Chief Executive Lowell McAdam said the company could have a wireless video service by year-end that lets pay-TV subscribers see some content on their mobile devices if regulators approve a proposed cable partnership.

Verizon's acquisition of radio spectrum owned by a group of cable companies would not serve the public interest, T-Mobile said in comments filed with the Federal Communications Commission.

The Benton Foundation joined a number of public interest advocates asking the Federal Communications Commission to block the deal.

On March 21, the Senate Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights held a hearing on Verizon’s proposed acquisition of spectrum from cable companies and related commercial agreements. The deal -- announced December 19, 2011 – is being reviewed by the Federal Communications Commission and the Department of Justice. Some lawmakers at the hearing cited AT&T’s failed acquisition of T-Mobile as confirmation of fears that consumers will face fewer choices for wireless service providers even as they come to depend more than ever on mobile devices as their primary tool to communicate. By book value, the Verizon-cable deal would actually be larger than the spectrum that would have been transferred in the AT&T/T-Mobile deal. The deal is the single largest spectrum transfer that the Federal Communications Commission has ever considered. Three questions kept coming up during the hearing: Will Verizon's purchase essentially eliminate a major competitor from the industry? Are Verizon and the cable companies colluding to drive up broadband prices? And does Verizon really need the spectrum it’s buying from cable operators, or is it just placing it out of competitors’ grasp? Over the last decade, Verizon has been Comcast's strongest competitor, and Verizon's new 4G/LTE network represents the most promising wireless alternative to a traditional wired broadband connection. But closer cooperation between Verizon and Comcast, many fear, will reduce competition between the two firms.

The more Harold Feld looks, pokes and prods at the Verizon/SpectrumCo/Cox spectrum deal the more convinced he is that this becomes one of the defining moments in telecom for 2012 – possibly for the foreseeable future.

Two labor unions descended on Capitol Hill to urge lawmakers to oppose deals between Verizon and a coalition of cable companies. Members of the Communications Workers of America (CWA) and the International Brotherhood of Electrical Workers (IBEW) spoke with lawmakers and delivered thousands of letters to Sens Charles Schumer (D-NY) and Kirsten Gillibrand (D-NY) calling on them to oppose the deals.

The Federal Communications Commission asked Verizon Wireless and several cable companies to provide additional information about a $3.9 billion wireless license deal. The agency also announced it will give parties until March 26 to comment on the deal.

Public advocacy groups and wireless competitors with concerns about Verizon's purchase of cable spectrum from SpectrumCo and Cox have asked the Federal Communications Commission to stop the clock on its review of the merger until Verizon submits unredacted versions of its cross marketing agreements with cable.

As we hope Headlines readers well know, on December 19, 2011, Verizon Wireless and SpectrumCo filed an application for the consent of the Federal Communications Commission (FCC) to the assignment of 122 Advanced Wireless Services licenses from SpectrumCo to Verizon Wireless. This past week was a first deadline for the public to tell the FCC about their concerns about the transaction.

Parties filed comments and petitions to deny the proposed Verizon Wireless purchase of cable spectrum assets held by SpectrumCo (Comcast, Time Warner and Bright House Networks) and Cox on February 21, 2012. Although the FCC was not inundated with thousands of furious consumer comments a la AT&T/T-Mobile (yet anyway), this $3.6b deal is certainly not skating by unopposed.

The debate over Verizon’s purchase of unused spectrum from cable companies is a fight that should involve everyone from consumers to the Internet companies whose businesses rest on access to the wireline and wireless pipes affected by this deal.