C Spire Wireless, DirecTV, Sprint Nextel and T-Mobile USA are among a group of companies and organizations that want more information in connection with Verizon Wireless' pending $3.6 billion acquisition of spectrum from cable TV operators and the agreements entered into between the wireless giant and cable companies to jointly market products and services.
"The acquisition of significant additional spectrum by the nation’s largest wireless carrier, by itself, warrants public involvement and scrutiny by the Commission. The applications, however, demonstrate that this spectrum transfer is part of a larger business transaction between actual and potential competitors," the group of companies and organizations, including the Consumer Federation of America, wrote. "Without the ability to review the larger transaction in its entirety, it is impossible to assess whether there will be public interest harms associated with this proposed transfer."
The group is asking the FCC to dig deeper into the deals and require Verizon Wireless and the cable operators to reveal further details about the various transactions, including agreements that call for Verizon Wireless and the cable companies to sell one another's products and services. Comcast, the nation's largest cable TV operator, and Verizon Wireless already have commenced a partnership on the West Coast to offer each other's services in areas in and around Portland, Ore., and Seattle.
"The assignment of CMRS spectrum represented by the applications appears to be only one small part of what could be a significant realignment of the competitive landscape in these industries," the group said.
The FCC last week opened a docket on the proceeding, and comments already are beginning to pour in from wireless associations and others that have expressed concerns. Earlier this week, representatives of an association that promotes the agenda of rural and regional wireless carriers met with an FCC official to discuss the Verizon Wireless/cable deal and Verizon Wireless' $315 million agreement to acquire spectrum from Cox Communications, among other matters.
"This transaction would result in an unprecedented spectrum consolidation into the hands of the largest carriers and further increase Verizon Wireless and AT&T's duopoly power," wrote Rebecca Murphy Thompson, general counsel of RCA, in a letter to the FCC.
Thompson's above statement resembled arguments raised by many critics during AT&T's failed bid to acquire T-Mobile USA. AT&T in December revealed that the T-Mobile deal was dead. That was the same month Verizon Wireless announced an agreement to purchase 122 spectrum licenses from a joint venture among subsidiaries of Comcast Corp., Bright House Networks, LLC and Time Warner Cable Inc. The U.S. Department of Justice, which filed a lawsuit over the summer to block the AT&T/T-Mobile merger, also is looking at the Verizon Wireless/cable pact, according to news reports.
In a filing with the FCC, Free Press policy director Matt Wood asserted that the spectrum license transfers and joint marketing agreements "would weaken the incentives for all of the participating companies to compete with one another in providing broadband, wireless, and video services."
