T-Mobile announced an agreement on Monday to swap hundreds of wireless licenses with Verizon, becoming part of a larger spectrum deal that the smaller carrier has opposed for months.
Verizon is seeking to buy spectrum from a consortium of cable companies. As part of the transaction with T-Mobile announced on Monday, Verizon will trade some of the spectrum it buys from the cable companies.
The deal includes licenses for spectrum in more than 200 markets across the United States, and T-Mobile says it will help boost its networks covering 60 million people in cities including Philadelphia, Washington, D.C., and Detroit.
The deal between Verizon and companies like Cox and Leap has been under scrutiny from regulators and critics who say Verizon could end up controlling a big swath of prime spectrum.
Until Monday, T-Mobile was one of the leading critics, having joined a coalition to oppose the deal and formally asking the Federal Communications Commission to block the deal.
Now T-Mobile is dropping its petition to deny at the FCC as well as all opposition to the Verizon-cable transaction — as long as its spectrum deal is included.
“Our principal concern with the original cable deal was that it would result in an undue concentration of spectrum,” T-Mobile spokesman Tim O'Regan said. “Following regulatory approval of our agreement announced today, we now support approval of Verizon’s transaction, and believe it is in the public interest.”
The move was a major shakeup in the opposition to the Verizon deal, but critics appeared largely unmoved by T-Mobile’s reasoning.
“While it's nice that Verizon will cede a small portion of its vast spectrum holdings to T-Mobile, that does nothing to mitigate the fact that Verizon and cable want to stop competing, stop investing, and stop innovating to the great detriment of consumers and the American economy,” the Alliance for Broadband Competition, which T-Mobile helped found with Sprint and advocacy groups, said in a statement.
Groups like the Competitive Carriers Association acknowledged that T-Mobile’s potential acquisition of the spectrum could sweeten the deal, but Public Knowledge’s Harold Feld accused Verizon of co-opting T-Mobile.
"That Verizon Wireless feels the need to buy off T-Mobile to close its spectrum/marketing deals with the country's largest cable operators underscores just how bad this deal really is for American consumers and competition generally,” Feld said in a statement.