Home » Bright House »Comcast/Xfinity »Competition »Cox »Public Policy & Gov't »Time Warner Cable »Verizon »Wireless Broadband » Currently Reading:

FCC on Verizon-Big Cable Spectrum Deal: Sure, Why Not?; But Justice Dept. Thinking Twice

Despite concerns from consumer groups that a deal to exchange wireless spectrum in return for collaborative marketing between two competitors will lead to higher prices for consumers, the Federal Communications Commission seems prepared to approve it, according to a report from the Reuters news agency.

Two sources familiar with the matter told Reuters the FCC has taken the lead on the “spectrum transfer” issue, which involves turning over prime wireless spectrum currently owned by large cable operators Comcast, Time Warner Cable, Cox, and Bright House Networks to Verizon Wireless. The combined licenses the cable industry holds are in the majority of major American cities, which critics charge Verizon will acquire to eliminate any potential competitive threat from a new nationwide wireless carrier.

Verizon’s recent moves to sell off its own “excess” spectrum to its current competitors has garnered favor inside the FCC, according to sources. Verizon Wireless recently agreed to transfer some of that spectrum to T-Mobile USA, which coincidentally was a fierce opponent of the deal between Verizon and cable operators. T-Mobile’s opposition has since muted.

Licenses owned by the cable industry would have been expansive enough to launch a new national wireless competitor. (Image: Phonescoop)

The deal between Verizon and the nation’s top cable companies is worth about $3.9 billion, but the Justice Department continues to signal concerns it would ultimately cost consumers more than that. According to Reuters, Verizon remains in “tougher talks” with lawyers inside the Justice Department who are concerned cooperative marketing between the phone and cable companies would result in decreased competition and higher prices.

One source told Reuters regulators were hoping Verizon’s now-stalled fiber to the home network FiOS would bring major competition to the cable industry, which until then had only faced moderate competition from satellite dish providers. In return, Comcast and other cable operators were expected to invade the wireless phone marketplace, adding needed competition.

Instead, both sides have retreated to their respective positions — Verizon focusing on its wireless service and Comcast and other cable companies abandoning interest in wireless phones and sticking to cable-based products.

The idea that both would begin to cross-market each other’s products is “a problem” according to the Justice source not authorized to speak publicly.

Additionally, concerns are being raised over a proposed “joint operating entity” between Verizon and cable operators that would focus on developing new technologies that could lock out those not in the consortium.

No decision is expected from the Justice Department until August, but Justice officials have signaled they have several options they can pursue:

  1. Sue to stop the spectrum transfer;
  2. Force the companies to modify their proposal to reduce potential collusion;
  3. Approve the deal but monitor how cross-marketing agreements impact on consumer markets for wireless and cable products.

Search This Site:

Contributions:

Recent Comments:

  • Houston: Very helpful. I called an pretty easily got my bill reduced by $60/month and a U300, 18Mbps and phone package. They also threw in a one-time $60 bil...
  • shunda Hawkins: Hello im experiencing the same results. We have enough people here to file a class action lawsuit!!...
  • Doom: Nice to see Rocky Miller openly whoring himself out to the telecoms against the people he's purporting to represent....
  • Oscar@SA: Come to San Antonio. I will help bury the cable in my area if needed, then I can go tell TWC to go you know where.. lol...
  • ssssssssssss: who want to make money online >>> http://adf.ly/wTP2i <<< after 3 mouth can you make almost 5 usd per day but after 1 year can youy...
  • John: Gah, they are putting up Google Fiber in NC and Georgia, but nothing in SC? Not even Charleston or Columbia or Myrtle Beach?...
  • BobInIllinois: So far, NO Google FIber in Big 10 country!!.....
  • Javier: Im having bad internet and phone signal with brighthouse for many years, I get disconnected from internet and my son xbox game is the same, technician...
  • Brian: I am an avid gamer who feels this pain as my speed drops to half (or less) during peak hours. Imagine my pain as only 10 miles away my friends have su...
  • Jason: Great article! I had U200, 18mps internet with 3 receivers, HD with no premium channels. I was paying $163/month and received a mailer from Comcast...
  • Limboaz: Figuring out how to stop the blatant corruption in Washington is one of the biggest challenges facing the American public. Frankly, crony capitalism s...
  • jdhdbsb: Post this on reddit in as many subreddits as you can, post on Facebook, Twitter, and whatever else you can. Will get more attention this way....

Your Account: