Verizon gains approval to buy $3.9B of spectrum from MSOs

Michelle Clancy | 17-08-2012

Verizon Wireless has won conditional approval from the Department of Justice to buy $3.9 billion worth of AWS spectrum from a quartet of cable companies: SpectrumCo, the joint venture between Comcast, Time Warner Cable and Bright House Networks, and, separately, Cox Communications.

The cablecos and Verizon agreed to the sale in December but the deal was quickly blocked by the Department of Justice and the FCC so that they could review it for anticompetitive ramifications.
The agreement would give Verizon a vast swath of valuable AWS spectrum covering most of the United States, and would also carry business relationships: Verizon and the cable companies would resell each others' service, and the MSOs could opt to become MVNOs on Verizon's network.
Verizon has agreed to some conditions in order to gain the DJ's approval. Within five years, the cable companies will be able to offer service from not just Verizon, but also Verizon's competitors. Also, Verizon will not sell competitive cable service in its FiOS and DSL markets. Also, the MSOs and Verizon will form a JV for technology research.
The DOJ's Acting Assistant Attorney General, Joseph Wayland said the arrangement "provided the right remedy for competition and consumers."
The FCC is expected to approve the deal as well on the recommendation of Chairman Julius Genachowski.