Verizon closer to securing approval for cable spectrum deal

10 July 2012 | Kavit Majithia


US regulator the FCC is set to approve Verizon Wireless’ plans to acquire spectrum from cable companies, according to reports.

Verizon Wireless announced a deal back in December 2011 to buy spectrum from a cable consortium of operators, which includes Comcast and Time Warner for approximately $3.9 billion.

Reuters reports the company still has to convince the Justice Department in the US that the deal will not have a detrimental effect to consumers with regards to pricing.

Sources close to deal claim the FCC has taken a lead role in assessing the bid, and is preparing to approve it. If approved, the US telco will have an edge over its rivals in the wireless space, and has been seeking approval for the deal on the grounds that it will transfer some airwaves to smaller wireless companies to maintain competition.

Last month, Verizon announced a spectrum sharing deal with Deutsche Telekom’s T-Mobile USA, which led to the German telco dropping its opposition to Verizon’s cable spectrum bid.

Despite gaining ground with the FCC, reports suggest the Justice Department is wary that collaboration between the largest telco in the US, Verizon, and the largest cable company in Comcast, would result in an aggressive marketing campaign by the two companies.

There is a fear that this could mean higher internet and wireless package prices for consumers.