Hoping to gain approval of its bid to buy spectrum for a group of cable companies, Verizon announced on Wednesday that it would sell some spectrum it currently holds if the deals are approved.
Verizon wants the Federal Communications Commission to approve its purchase of 20 megahertz of spectrum from a joint venture that includes Comcast, Time Warner Cable and Bright House Networks, and from Cox Communications as part of a separate deal. Verizon and the cable firms also asked the Justice Department to approve a separate joint marketing agreement to sell each other's services. Verizon says it will use the cable firms' spectrum and additional airwaves it owns now to deploy next-generation 4G LTE (long term evolution) wireless service.
Verizon said Wednesday that if regulators approve the deals, it will sell the A and B licenses for unused spectrum in the 700 megahertz range, which the firm said covers "dozens" of major cities and rural areas including Chicago, Los Angeles, New York and Washington, D.C.
"Since wireless operators, large and small, have expressed concern about the availability of high-quality spectrum, we believe our 700 MHz licenses will be attractive to a wide range of buyers," Molly Feldman, Verizon Wireless vice president of business development, said in a statement. "Moreover, provided our acquisition of AWS spectrum is approved, our open sale process will ensure these A and B spectrum licenses are quickly and fairly made available for the benefit of other carriers and their customers."
Critics of the spectrum and marketing deals worry that the spectrum deals will decrease competition in the wireless market while the marketing deals will give the Verizon and the cable firms little incentive to compete vigorously against each other. They argue that Verizon's announcement Wednesday proves their claim that the firm is "hoarding" valuable spectrum.
"Verizon does not need cable's spectrum. Verizon already controls large swaths of unused beachfront airwaves that it could use to meet future demand," Free Press Research Director S. Derek Turner said in a statement. "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."
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