FCC Sorted Out Highly Complex Spectrum Deal

By Wayne Rash  |  Posted 2012-08-16 Print this article Print

In a press background briefing held by the FCC Aug. 16, the FCC staff said that when the deal came to them that it was the most complex that the FCC had seen. Part of the complexity was in the spectrum license transfers and much of it was in the commercial agreements. According to staff members speaking on background, the commission divided the proposal into two parts, so that the commission and the DOJ could review the commercial agreements separately.

As part of the process of approving the commercial agreements, the Justice Department and the Attorney General of the state of New York filed an antitrust suit against Verizon and SpectrumCo, followed immediately with the consent decree that then settled the suit.

Ultimately, the spectrum deal involved a three-way spectrum swap and sale. Leap Wireless had previously filed a spectrum sale with the FCC. During the review of that deal, Verizon agreed to engage in a spectrum sale and transfer with T-Mobile. The FCC combined all of the deals into a single package.

The package, if approved by the full commission, will allow the Leap Wireless spectrum deal to go through. The T-Mobile deal includes the swap of some spectrum with both companies getting spectrum from the other in order to rationalize their respective spectrum holdings. In addition, Verizon Wireless will sell about 20MHz of Advanced Wireless Service (AWS) spectrum to T-Mobile to allow that company to continue the build-out of its LTE services while also re-farming its existing Evolved High-Speed Packet Access (HSPA+) service, a process which is already under way.

The FCC staff noted that it completed its review of the Verizon spectrum deal within the commission's 180-day "shot clock." However, final approval of the total spectrum deal is in the hands of the full commission and currently there is no schedule for action by the full commission.

Comcast executive vice president David L. Cohen released a statement expressing appreciation of the DOJ approval of the antitrust issues involving the commercial agreements. "We appreciate the timely completion of the antitrust review by the government of the proposed sale of spectrum and associated commercial agreements between Verizon Wireless, Comcast and the other cable companies," Cohen said in a prepared statement. "And, we are pleased that the consent decree that we have negotiated with the Department of Justice preserves the most important goals of the agreements."

The FCC will be releasing the full text of its draft order late in the day Aug. 16.

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Wayne Rash Wayne Rash is a Senior Analyst for eWEEK Labs and runs the magazine's Washington Bureau. Prior to joining eWEEK as a Senior Writer on wireless technology, he was a Senior Contributing Editor and previously a Senior Analyst in the InfoWorld Test Center. He was also a reviewer for Federal Computer Week and Information Security Magazine. Previously, he ran the reviews and events departments at CMP's InternetWeek.

He is a retired naval officer, a former principal at American Management Systems and a long-time columnist for Byte Magazine. He is a regular contributor to Plane & Pilot Magazine and The Washington Post.

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