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Policy

Advocacy Groups Try to Block Spectrum Sale

2/27/2012 12:01 AM Eastern

Washington — Cable operators are facing much of the
same opposition to their proposed sale of spectrum to Verizon
Wireless that T-Mobile did in trying to combine with AT&T.

Last week, at least 10 public-advocacy groups — including
AT&T/T-Mobile merger opponents Free Press, Public Knowledge
and Media Access Project — asked the Federal Communications
Commission to block the deal, just as they had with
the AT&T/T-Mobile deal, which was eventually halted.

Feb. 21 was the deadline for comments and petitions to deny
the Verizon deals, in which the telco is proposing to pay SpectrumCo
partners Comcast, Time Warner Cable and Bright
House Networks a combined $3.6 billion and Cox Communications
another $315 million for their Advanced Wireless Spectrum
licenses.

The cable operators bought the spectrum at auction but
eventually concluded that building out a competitive national
wireless broadband network was not in their business plans.
Instead, they focused on deals to package existing service —
Comcast’s deal with Verizon, for example
— into their bundled offerings
and on using Wi-Fi hotspots to give
their wireline customers mobility.

In the filing, Free Press and the
others argued that the spectrum sale,
combined with exchange-of-service
deals between Verizon and the cable
operators, would fundamentally alter
the telecom market — and not in
a good way.

First, the advocacy groups don’t
want Verizon to get any more spectrum, “aggravating existing
anticompetitive problems with spectrum aggregation,”
they said, echoing the spectrum-concentration
knock they had on AT&T-T-Mobile. Second, they said, separate
agreements between Verizon and the companies to
sell their video services means that not only will they not
compete, but they may collude. The groups cite the agreement
by the companies to create a “joint operating entity”
to develop new technologies to link voice, video
and wireless traffic.

Public Knowledge hammered the deal as creating
a telecom cartel in which “Verizon and
AT&T get wireless; cable gets wireline; and consumers
get nothing.”

But the FCC has itself been promoting the integration
of video and data in a broadband delivery
system as a way to promote adoption of a
technology it suggests is this generation’s highway
system and electric grid rolled into one.

One big difference between the AT&TT-
Mobile and Verizon-cable deal is that cable operators
had not been using the spectrum, so Verizon’s purchase
would be addressing that vaunted spectrum shortage the
FCC is looking for ways to relieve. The agency just killed
LightSquared’s plans to use its spectrum for a mobile
broadband network (see Rules), and it will be
years before the broadcast-TV spectrum the agency seeks
to auction will find its way to market.

September