FCC Seeking More Details On Proposed Verizon Spectrum Transfer
March 11, 2012

FCC Seeking More Details On Proposed Verizon Spectrum Transfer

The US Federal Communications Commission (FCC) is asking for additional information regarding a proposed transfer of wireless spectrum from a trio of cable providers to Verizon Wireless.

According to reports from both Zachary Lutz of Engadget and Hayley Tsukayama of the Washington Post, the FCC has asked Verizon, SpectrumCo (a joint venture from Comcast, Time Warner Cable, and Bright House Networks) and each of its individual members, and Cox Communications for more details regarding the proposed transfer.

An FCC statement says that Cox, a former member of SpectrumCo, and Verizon have "have filed an application to assign 30 20-MHz AWS-1 licenses from Cox to Verizon Wireless. Together, the licenses involved in the transactions cover 662 CMAs and 290 million people (approximately 94% of the U.S. population)."

They also report that Verizon and the four cable providers have reached a series of agreements through which they would sell each other's products, and through which Comcast, Time Warner, Bright House, and Cox would eventually be able to sell Verizon's wireless service on a wholesale basis.

Furthermore, the FCC notes that all of the parties with the exception of Cox "have also formed a joint venture, which Cox expects to enter, to develop technology to better integrate wireline and wireless products and services."

Tsukayama reports that the companies argue that their commercial dealing should have no impact on the spectrum deal in terms of its effect on the public interest, but that critics of the proposed deal believe that all of their transactions should be considered together during the FCC review.

In a statement published by the Washington Post, FCC spokesman Neil Grace said that the commission "has concluded that portions of the commercial agreements are inseparable from the proposed license transfer and related wireless competition issues," that all parts of the commercial deal would be considered as part of the license transfer hearing, and that "additional competitive implications of the commercial agreements" were currently being reviewed as part of "a separate inquiry.”

Lutz also said that Verizon is being asked to provide an analysis of a proposed spectrum transfer between themselves and Leap Wireless, and its proposed impact on the separate agreement with the quartet of cable providers. Verizon is being asked to "substantiate“¦ claims that it'll require additional spectrum in some markets as early as 2013," and the FCC has given the company until March 22 to respond, he added.

Media Access Project Policy Director Andrew Schwartzman told Tsukayama that this was "an extremely important development," adding, "Those of us who have opposed the transaction have argued that it is not possible to ascertain the potential anti-competitive impact of the cable industry's deal with Verizon without the information that refused to disclose."

The $3.6 billion spectrum transaction between the Verizon and SpectrumCo was originally announced back in December 2011. According to Eric Savitz of Forbes, the deal will pay $2.3 billion to Comcast, $1.1 billion to Time Warner, and $189 million to Bright House, and covers 122 Advanced Wireless Services spectrum licenses servicing an area populated by more than 250 million people.


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