Washington

Critics Slam Verizon Spectrum Plans

Company counters that it is simply lining up best mix of assets to serve customers 4/18/2012 12:44:06 PM Eastern

Critics of Verizon's planned purchase of cable
operator spectrum were quick to jump on the company's announcement Wednesday
that it was putting the 700 MHz spectrum it got in an FCC auction on the block
contingent on the approval of the purchase of AWS spectrum from SpectrumCo.

"Until
today's announcement, Verizon denied that it was hoarding spectrum," said
Free Press Research Director Derek Turner in a statement. "This sale
demonstrates that Verizon has in fact warehoused spectrum and the company will
likely profit handsomely from this spectrum speculation strategy. Verizon does
not need cable's spectrum. Verizon already controls large swaths of unused
beachfront airwaves that it could use to meet future demand. Allowing Verizon
to foreclose future wireless competition by gobbling up the valuable airwaves
currently held by its cable competitors is clearly not in the public
interest."

Public
Knowledge saw the announcement as a way to grease the skids for government
approval.

"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," said
PK legal director Harold Feld. "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 help consumers."

A
Verizon official, speaking on background, called the charges baseless.

"Verizon
Wireless isn't trying to make some larger political point, as Public Knowledge
and Free Press suggest," he told B&C/Multi. "If the FCC approves
our pending purchase of spectrum, we will have other spectrum to sell.  We
are simply making that known and beginning the process for selling it. It's
that simple."

He said the company's spectrum plans are a case of building ahead of
demand. "Verizon purchased these licenses in 2008 to have available
spectrum to meet customers' increasing demand for wireless services," he
said. "In 2008, we also purchased the 700 MHz upper C block spectrum,
which we're using robustly today to build out our 4G LTE network. Given the
tremendous capabilities inherent in our 4G LTE network, we are focusing on what
we believe to be the right mix of spectrum assets needed for us to expand that
network, which includes AWS

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