A group of House Democrats on Wednesday called on federal regulators to closely scrutinize Verizon Wireless' bid to buy spectrum from and enter into marketing agreements with a group of cable firms, saying the deals could threaten the competitive goals of the 1996 telecommunications act.
"It was the intent of Congress in the act to promote competition between telephone and cable companies," according to a letter signed by Rep. Ed Markey, D-Mass., a senior member of the Energy and Commerce committee, Judiciary ranking member John Conyers, D-Mich., and five other House Democrats. The letter was sent to Federal Communications Commission Chairman Julius Genachowski and Attorney General Eric Holder.
"Following the enactment of the act, a new boom of innovation and competition was unleashed, resulting in hundreds of billions of dollars of new private sector investment thanks to broadband revolution initiated by the statue. To fulfill the purpose and promise of the act, it is essential that competition and consumer choice continue to animate our nation's communications policies," the lawmakers added.
The lawmakers, however, did not call for the deals to be blocked and instead called on the FCC and Justice Department to examine how the deals will impact telecommunications competition.
Verizon Wireless announced late last year that it would buy spectrum from a joint venture made up of Comcast, Time Warner Cable and Bright House Networks and from Cox Communications as part of a separate deal. Verizon and the cable firms also agreed to enter into joint marketing and technology agreements requiring them to sell each other's services.
Rivals such as T-Mobile USA, which has asked the FCC to block the spectrum transaction, argues that Verizon is warehousing spectrum and trying to keep the cable companies' airwaves from rivals who need it more. Critics of the marketing agreements, which include public interest groups and the Communications Workers of America, worry that Verizon and the cable firms will stop competing against each other to provide wired Internet, video and phone services to consumers.
Verizon has defended the spectrum deal by noting that the cable firms are not using the spectrum now and that, like other wireless carriers, Verizon will be able to put those airwaves to quick use to meet its customers growing demand for wireless technologies. At the same time, both Verizon and Comcast told a Senate subcommittee in March that they would continue to compete aggressively against each other.
The CWA, which represents thousands of Verizon and Comcast workers, held a protest outside the FCC's Washington offices on Wednesday with Verizon workers from five states and the District of Columbia to highlight their concerns with the marketing agreement.
"At a time of high unemployment, it's especially important that the FCC consider the jobs impact of this transaction," CWA Telecommunications Policy Director Debbie Goldman said in a statement. "The deal in its current form would have a devastating impact on communities across the county, as tens of thousands of jobs are lost or not created."