Verizon's $3.6B Spectrum Deal Nears Approval

Federal regulators are said to be close to green-lighting Verizon Wireless' deal to buy wireless spectrum controlled by Comcast and other major cable companies 

 

Verizon Wireless’s $3.6 billion deal to buy wireless spectrum controlled by Comcast and other major cable companies is expected to win the approval of federal regulators soon in the wake of company agreements easing antitrust concerns, sources with knowledge of the issue told TheWrap Tuesday.

The company agreements would essentially restrict the ability of Verizon and the cable companies involved in the transaction — Comcast, Time Warner Cable and Bright House Networks — to market each other’s video and broadband services in areas where they compete.

Another agreement would require the companies to seek antitrust clearance every four or five years for a joint venture to develop new wireless communications technology.

“[The deal] is close to being done,” said one individual with knowledge of the issue.

“We’re confident we’ll be getting approval this summer,” Ed McFadden, a spokesman for Verizon Wireless’ parent company Verizon Communications, told TheWrap. “Discussions at both the FCC and Department of Justice are ongoing.”

Verizon intends to use the spectrum acquired to meet growing consumer demand for broadband data services, McFadden said.

Also read: Consumer Group: Verizon-Time Warner Cable-Cox Joint Venture a 'Template for Cartel'

When Verizon originally announced the huge spectrum acquisition last December, the company revealed that Verizon and its cable industry partners had also agreed to sell each other’s products. In addition, Verizon announced that the companies had formed a joint venture to develop wireless technology.

Consumer watchdog groups protested the arrangements, contending that the new partnerships would hurt consumers by limiting competition.

To ease those concerns, the companies have now agreed to refrain from marketing some of each other’s video and broadband services.

“The antitrust concerns are partially alleviated by prohibiting the companies from selling each other’s services where they compete,” Joel Kelsey, a policy adviser for the consumer watchdog Free Press, told TheWrap.

Also read: Comcast to Pay $800K to Resolve FCC Probe

“The agreements are essentially agreements not to compete among four of the largest telecommunications providers,” Jodie Griffin, a staff attorney for Public Knowledge, another consumer watchdog group, told TheWrap.

Spokesmen for the FCC and the Department of Justice declined to comment.

Spokeswomen for Comcast did not immediately return calls to TheWrap.