Public Knowledge Expresses Doubts About Verizon Spectrum Sale

Background: Verizon announced today that it would sell some of its wireless licenses if the Federal Communications Commission (FCC) approved the company’s plan to buy spectrum from major cable companies and to have marketing agreements with the cable companies.

The following is attributed to Harold Feld, legal director of Public Knowledge:

“There is less than meets the eye to Verizon’s spectrum sale. At the end of the day, Verizon and the cable companies will still have created a cartel in which Verizon will rule the air for wireless broadband and cable will offer the only widespread true high-speed landline Internet services.

“Verizon is trying to use the mere offer of a spectrum sale tempt the FCC and the Justice Department into approving the deal with the cable companies, and the agencies should resist the temptation. Recent history of such spectrum sell-offs shows that when Verizon and AT&T sell off spectrum, it’s Verizon who buys AT&T’s, and vice versa. Having AT&T buy Verizon spectrum in this instance would do nothing to change to help consumers.

“Even if AT&T were barred from bidding, the amount of spectrum that other companies would receive might increase their capacities marginally. At the end of the day, however the Verizon sell-off turns out, the gap between the biggest companies and the rest of the industry would grow and the competitive world would shrink even more. Consumers would again be the losers.”

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