T-Mobile Asks FCC To Block Verizon Cable Deal
NEW YORK (CBSDFW.COM/AP) – T-Mobile USA, which just had its acquisition by AT&T blocked by regulators, is urging the federal government to block another deal in the wireless world: Verizon’s planned purchase spectrum from cable companies for $3.9 billion.
In a filing late Tuesday, T-Mobile USA said the Federal Communications Commission should stop the deal between Verizon Wireless, Comcast Corp., Time Warner Cable Inc., Bright House Networks and Cox Communications because it would place an “excessive concentration” of wireless spectrum in Verizon’s hands.
Nine public interest groups also filed motions to block the deal on Tuesday, ahead of a filing deadline on Wednesday.
With more wireless spectrum, a phone company can raise download speeds and serve more data-hungry devices like smartphones and laptops with cellular broadband.
Verizon Wireless, the country’s No. 1 cell phone company, already has a relatively large amount of spectrum, while T-Mobile, the No. 4, does not.
T-Mobile’s petition to block the deal is the first by a major Verizon Wireless competitor. Two weeks ago, T-Mobile joined Sprint Nextel Corp., the No. 3 wireless carrier, and DirecTV Group Inc., the satellite TV company, in asking the FCC to make Verizon and the cable companies produce more information about the deal.
Last week, a New Jersey’s Division of Rate Counsel, a state agency that advocates for consumers, asked the FCC to block the deal, also citing the spectrum accumulation issue.
Verizon Wireless has defended the deal, saying it means unused spectrum will become available to wireless subscribers.
In early December, Verizon Wireless announced a deal to buy spectrum from Comcast, Time Warner Cable and Bright House Networks for $3.6 billion. The cable companies had bought the spectrum jointly at an FCC auction in 2006, with loose plans to start a wireless company or form a joint venture with one. Those plans never came to fruition.
The parties said they hoped to close the deal by the middle of this year. But opposition to it has been mounting, with T-Mobile’s petition to block it being the most salient move so far.
Verizon later struck a similar but separate deal to buy spectrum held by Cox for $315 million. Cox had started setting up its own wireless service, but gave up last year, saying it would be too small to compete against the big cellphone companies.
Under the deals, Verizon Wireless and the cable companies will be marketing each other’s services in their stores, even though Verizon Communications Inc., the New York-based majority owner of Verizon Wireless, competes with the cable companies in providing pay-TV and broadband service.
Shares of Verizon Communications slipped 10 cents to $38.39 in morning trading Wednesday.
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