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U.S. approves Verizon Wireless purchase of airwave licenses

Verizon Wireless wins federal approval for its $3.6-billion purchase of airwave licenses from large cable companies, but regulators slap more conditions onto the deal.

August 24, 2012|By Jim Puzzanghera, Los Angeles Times

WASHINGTON — Verizon Wireless won final federal approval for its $3.6-billion purchase of airwave licenses primarily from large cable companies, but regulators slapped additional conditions onto the deal.

The approval by the Federal Communications Commission on Thursday followed the go-ahead last week from the Justice Department, which also placed conditions on the deal to ease concerns that it would decrease competition in the telecommunications market.

The FCC voted unanimously to allow Verizon to obtain airwave licenses from a consortium of cable companies — Comcast Corp., Time Warner Cable Inc. and Bright House Networks — that once had hoped to launch its own mobile services. Verizon also acquired spectrum from Cox Communications and Leap Wireless International Inc.

To obtain the FCC approval, Verizon agreed to complete a planned spectrum swap with T-Mobile USA Inc. within 45 days after closing the cable deal to help boost competition from its much smaller rival. In addition, Verizon agreed to speed deployment of mobile services on the new spectrum. It will have to offer service to at least 30% of the population covered by the cable spectrum within three years and to 70% within seven years.

Verizon also agreed to continue to offer data roaming to competitors at reasonable rates for five years in areas where it has acquired new airwaves.

FCC Chairman Julius Genachowski said the deal had posed "serious anti-competitive concerns." But the conditions agreed to by Verizon would erase those worries and would "put valuable wireless spectrum to use while preserving broadband competition, to the benefit of consumers and our economy."

Verizon Wireless Chief Executive Dan Mead said the company would "work aggressively" to put previously unused spectrum to use quickly.

Consumer groups, which opposed the deal, said the conditions improved it. But they were still concerned about the effect on competition.

"Consumers already face limited options when choosing a broadband and wireless provider — oftentimes down to one provider in a market," said Parul P. Desai, policy counsel for Consumers Union. "It is time that we start finding ways to bring competition back to the market, rather than limiting the consequences of less competition."

jim.puzzanghera@latimes.com

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