VZW finally gets 700 MHz assets
November 14 2008 - 1:55 pm ET | Jeffrey Silva | RCR Wireless News
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The Federal Communications Commission gave final clearance to Verizon Wireless’ $4.7 billion purchase of a nationwide collection of regional licenses at the 700 MHz auction earlier this year, refusing Google Inc.’s request to impose a stronger open-access condition and revising a key component of its merger review policy.
The FCC action, which also requires the new No. 1 wireless provider to divest 10 megahertz in a New Jersey market, follows the agency’s approval of the $28 billion Verizon Wireless-Alltel Communications L.L.C. merger and cellular association CTIA’s withdrawal of a legal challenge to the C-Block open-access provision.
The 700 MHz licenses picked up by Verizon Wireless resulted in the carrier exceeding the 95-megahertz threshold in 17 markets, but after further review, the FCC concluded the newly acquired spectrum would not pose competitive harm in those markets. At the same time, the FCC said in the future it would count spectrum won at auctions toward the 95-megahertz spectrum screen. In recent merger rulings and continuing through its ruling on Verizon Wireless’ 700 MHz licenses, the FCC has not factored spectrum acquired at auctions into the 95-megahertz screen because winning bidders have been unable — for a variety reasons — to immediately secure the airwaves from the government to put it into operation.
The two Democrats on the Republican-controlled FCC welcomed the merger review change.
“Until today, the commission applied its spectrum screen to licenses obtained via merger or acquisition, but not to licenses acquired via auction. As we have stated before, this double standard makes no sense. Accordingly, we are pleased that today’s item announces that, from now on, the commission will apply its spectrum screen to both forms of spectrum acquisition,” stated Commissioners Michael Copps and Jonathan Adelstein.
As a result of the Nov. 4 elections, which gave Democrats control of the White House and larger majorities in Congress, there could be efforts to scrutinize wireless industry consolidation and revive the spectrum cap. The 55-megahertz cap was abolished in 2003. Tbe spectrum cap represented a more formalized policy than is the spectrum screen that’s been employed by the FCC the past five years.
Regarding the FCC’s rejection of Google’s petition for stricter C-Block open-platform requirements, Copps and Adelstein expressed measured support for more clarity.
“When we voted to establish service rules for that spectrum, we both expected that the C-Block winner would observe the openness rules for its own devices as well as those sold by third parties,” the commissioners stated. “And we believe today that the language in the commission’s rules establishes this legal requirement. However, to the extent that any parties believe the language is not clear enough, we would have preferred that the commission dispel any potential confusion by making this point directly in today’s item.”
One public-interest group urged the FCC to stay on the case regarding open access.
“CTIA’s flip-flop — coupled with the continued blocking and locking practices of the wireless networks — reminds us that we need the FCC to remain a vigilant cop on the beat protecting consumers with clear, enforceable openness rules,” said Ben Scott, regulatory director of Free Press.
Given its public support for net neutrality, the incoming Obama administration may push for greater openness in the wireless space even as carriers pursue their own plans to loosen their grip on networks and allow the entry of third-party devices and applications.
November 18, 2008 06:05 am
WEll, Maybe the smaller cell phone companies can as the Government for a Bail Out like multi-million dollar companies are doing to stay in business.
November 17, 2008 06:01 am
Jeez, Thomas! Do you think you could learn to type & spell just a little better? It isn't that hard to construct a decent sentence. Look at mine.
November 16, 2008 04:07 pm
First of all. You have to pay for good servise. if verizon didnt charge what they did, thet would not be able to keep up the next work. Now that we purchased the 700mhz it will allow them to have better service in the middle of no where. Dont be upset that Verizon took the time to build there foot print.
November 16, 2008 06:00 am
I feel bad for the smaller companies, but in todays age its survival of the fitest. I work for Alltel and am glad the merger is going the way it is. I worked for Sprint for two years and they had some cheap plans, but I find coverage to be more important to customers then price. You can save a ton of money, have a bunch of features and customer service that is outsourced. Plus if you dont have a signal you cant use your features.
November 15, 2008 04:59 pm
I beg to differ, vzw has some of the worst service I have seen. Even worse is their packaging deals. They have worse service in the middle of nowhere then at least 3 other carriers(including sprint, which believe it or not has better coverage here then vzw). The company I work for can give away its 3x the amount of minutes for the same price, unlimited texting and not to mention 5 lines for the same price of 2 at vzw. I've seen it, I know, I've had people port from the big corporate store 4 stores down from me many of times.
November 14, 2008 01:56 pm
There are several details regarding this allocation that would outline why the FCC decided to allow VZW to break an archaic regulation. One reason being they contract their data network to other networks. The reason VZW's prices are higher is because of the service quality and expansive footprint. It's just like everything else in the world. Better product, higher price.
November 14, 2008 01:56 pm
Uh, what does this mean for consumers? You know, the guys who are going to pay for it?
November 14, 2008 01:56 pm
I love how the FCC just decided that oh well vzw is violating a rule that we have set forth and that every other company has to follow by... we'll just decide to flex the rules a bit to allow the now largest company(hence merger) and one with terrible service pricing, rule a spectrum that other companies could put to "better" use. Thanks FCC for giving a chance to smaller companies who care about their service quality, not quanity.