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Posted at 11:29 AM ET, 02/22/2012

Critics tell FCC to block Verizon deal with cable firms

(Justin Sullivan - GETTY IMAGES)
T-Mobile and public interest groups on Tuesday urged the Federal Communications Commission to block Verizon Wireless’ spectrum and marketing deal with cable firms, saying the transaction would lead to less competition and higher wireless service fees for consumers.

In filings late Tuesday at the FCC, T-Mobile said the $3.9 billion sale of airwaves to Verizon by cable firms would create “excessive concentration” in the wireless market. Verizon Wireless is the nation’s biggest wireless service provider with more than 100 million subscribers.

Several public interest groups including Public Knowledge asked the FCC to block the deal, expressing concern over a a unique cross-marketing agreement between fierce rivals in the business of supplying wireline Internet connections into homes.

Verizon Wireless defended the deal, saying it needs more spectrum to bolster its networks.

“It will put spectrum to work to meet growing demand, and we believe the transfer is in line with goals in the FCC’s National Broadband Plan,” Verizon said in a statement.

Through the deal, Verizon Wireless and cable companies have begun to cross-promote each other’s services so that they can offer what is known as “quadruple plays” — bundles of landline phone, wireless, cable television and high-speed Internet connections to consumers.

That portion of the deal is being investigated by the Justice Department, which is also reviewing the deal, because of concern Verizon Communications may let its FiOs wireline television and Internet service atrophy.

The marketing arrangement “gives rise to serious concern that not only will these providers decline to compete further with one another, they will actively collude with one another," the public interest groups said in a joint filing.

The Communications Workers of America labor union told the FCC that it does not oppose the sale of spectrum to VerizonWireless because if feels unused airwaves should be quickly put to use to handle the capacity problems faced by consumers.

But it asked the FCC to ensure Verizon keep up its television and landline Internet service to areas it covers and to expand it to cover nearly the whole nation. Verizon Communications has said it won’t expand beyond its current footprint of about 14 million homes.


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By  |  11:29 AM ET, 02/22/2012

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