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T-Mobile USA and Sprint Nextel have asked the Federal Communications Commission to suspend its review of Verizon Wireless’s purchase of wireless spectrum from cable operators.
The wireless operators want Verizon to disclose more information about the marketing deals it struck with cable operators as part of its $3.6 billion deal with these companies hashed out late last year. The companies say the FCC should suspend its 180-day review of the deal until that information is made public.
In an FCC filing, T-Mobile and Sprint were joined by DirecTV and several consumer groups in asking that Verizon Wireless provide unredacted versions of its filings to the agency that detail its commercial agreements with the cable operators.
In December, Verizon Wireless struck a deal with Comcast, Time Warner Cable, Bright House Networks, and Cox Communications to buy 20MHz of unused AWS wireless spectrum. The cable companies had formed a consortium in 2006 to buy the spectrum in an auction. Verizon has said the additional spectrum will be used to supplement its 4G LTE service.
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In addition to the spectrum, Verizon also struck several marketing deals with the cable companies. For example, cable operators will be able to sell and market Verizon Wireless service as part of a quadruple-play bundle to their customers. And Verizon Wireless will be able to market and sell cable broadband, TV, and voice services in Verizon Wireless retail stores. Additionally, the agreement stipulates that four years from now, the cable operators will be able to get access to all of the Verizon Wireless network at wholesale rates so that they can sell wireless service under their own brands.
Some experts have said that the marketing and reselling portions of the deal may be more valuable in the future than the spectrum portion of the deal.
And now T-Mobile, Sprint, DirecTV and some consumer groups want more details on this part of the arrangement. But Verizon has argued that it should not have to make details of the deal public via FCC filings, since the U.S. Department of Justice is already reviewing full details in documents that have been filed there. Verizon also argues that it has redacted information regarding the marketing deals in the FCC filing, because it’s trying to protect sensitive business information.
T-Mobile and Sprint have already taken issue with Verizon’s deal with the cable companies because they believe that it will give Verizon too great a concentration of wireless spectrum. Last week, the companies lodged complaints with the FCC.
It makes sense that T-Mobile and Sprint would oppose the transfer of wireless spectrum to Verizon Wireless. Verizon and AT&T are the two largest wireless providers in the country. And Sprint and T-Mobile are distant third- and fourth-place providers, respectively.
Last year, regulators blocked AT&T’s $39 billion bid to buy T-Mobile USA.
