Will Verizon become the only wireless company in the country?
Verizon wants to buy a large portion of spectrum from Comcast, Cox Communications and Time Warner Cable. T-Mobile has filed a complaint with the Federal Communications Commission seeking to stop the deal, saying it would leave T-Mobile unable to compete.
“What they're saying is the benefits of this transaction are way outweighed by harms to the public that would be caused,” says Susan Crawford, visiting professor at Harvard’s Kennedy School of Government and Harvard Law School. “Because from their perspective, what Verizon's trying to do with this spectrum deal is just foreclose competition, make it impossible for any maverick new entrant to show up. Verizon said as recently as a month ago it's got plenty of spectrum; in fact, it's sitting on spectrum it's not using and T-Mobile is saying don't let this go through." Crawford says T-Mobile’s goals in this protest and the AT&T deal are the same: “T-Mobile felt forced to do a deal with AT&T last year because it wasn't getting access to enough spectrum. Now T-Mobile is saying we're not getting access to enough spectrum. Basically a lot of spectrum has been taken off the table in the last couple of years, spectrum that T-Mobile feels it needed in order to compete effectively. This is its last ditch battle to make sure that there's something left for it to buy." Verizon and the cable companies seem to be marking out territory here by agreeing to market each other’s services and stay off each other’s turf. “Implicitly they're saying, ‘Comcast you cover wired connections, and Verizon, you cover wireless,’” says Crawford. Thing is, demand for spectrum will keep going up as people get more smartphones and tablets and go online. And you can't make more spectrum. That’s impossible due to the realities of physics.
Will Verizon become the only wireless company in the country?