Verizon gets DoJ clearance for cable deal
As expected, spectrum sale approved but with limitations on cross-marketing, while FCC green light still needed
Published: 17 August, 2012
Verizon Wireless has got clearance from the Department of Justice for its cableco deal, with some concessions. It still needs an FCC green light for the spectrum aspects of the multifaceted agreements, but this is now highly likely to happen soon.
Under the $3.9bn deal, Verizon significantly boosts its holdings of LTE-suitable AWS frequencies, though some of them will be then be included in a separate spectrum swap with T-Mobile USA. That agreement was one of the major compromises which sweetened the cable proposal because it puts TMo in a far stronger position to be competitive in 4G.
Meanwhile, as well as buying the licences from SpectrumCo (a venture of Comcast, Time Warner and BrightHouse) plus Cox, Verizon will engage in cross-marketing pacts with its new friends, while they will offer wireless services using its networks, defecting from previous ties to Clearwire and Sprint.
The cross-selling was the aspect which attracted most concern from consumer groups and the DoJ. The antitrust agency said joint marketing agreements between the companies would have lessened their incentives to compete aggressively in areas where they offer rival broadband, TV and quad play services. As a condition of approving the proposals, the DoJ insists that the partners limit the scope and duration of those cross-marketing arrangements.
FCC chairman Julius Genachowski said in a statement: "I believe the commission should now approve this transaction, and I will be circulating a draft order to my colleagues that would do so."