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Justice Department Probes Verizon Cable Deal
As Consumer Groups Worry About Competitive Impact
by Karl Bode Tuesday 20-Dec-2011 tags: dsl · competition · business · alternatives · consumers · Comcast · Verizon FiOS
With the AT&T deal shelved, consumer advocates are now turning their attention to Verizon's recently announced $3.6 billion alliance with the cable industry. The deal gives Verizon a significant spectrum boost in addition to an exclusive partnership to sell Verizon LTE services to cable customers. Groups like Free Press have been quick to criticize the deal, worrying that the vague nature of the arrangement could include some provisions that hinder competition. From a statement by Free Press Policy Director Matt Wood:

"Verizon Wireless and its newfound cable allies should stop hiding the ball. Today's filing provides some more details on the license deal that would strengthen the hand of what is already the nation's largest wireless provider. But the document sheds no light on the joint marketing deals that Verizon Wireless is forging with the cable cartel. There may be provisions within these deals that would reduce the participating companies' incentive to compete with one another as they work to resell each other’s products rather than rolling out their own services and battling for customers. Such cooperation all but ensures that consumers would have fewer choices and would have to pay higher prices for broadband, wireless and video services.

The Justice Department is at least interested in some of these possible anti-competitive repercussions, and has started an investigation of the deal. As we've noted previously, one group the deal will impact most is rural DSL providers, many of whom are already at a disadvantage to cable operators in their market due to the relatively inexpensive cost of DOCSIS 3.0 upgrades versus fiber to the home/node upgrades.

Meanwhile in markets where Verizon competes with cable with DSL but hasn't shown an interest in upgrading to FiOS (many portions of upstate NY come to mind), duopoly competition is already tepid and could be made worse by a cozier relationship to cable.

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CaptainRR
Premium
join:2006-04-21
Blue Rock, OH

Competing with DSL?

How about bringing LTE broadband were I am with at&t that even refuses to deploy DSL! There are many areas like mine but they dont look at that part of it.
05678973

join:2011-11-30
Cottontown, TN

Re: Competing with DSL?

Yea...what about homes with no broadband access....as usual they get screwed!!!!!!!!
Automate

join:2001-06-26
Atlanta, GA

Good

I think the FCC should look at the deal also. I don't know how much Verizon has, but I don't think any company should be allowed to have more than 33% of the total wireless phone frequencies.

BF69
Premium
join:2004-07-28
Camden, TN

Re: Good

said by Automate:

I think the FCC should look at the deal also. I don't know how much Verizon has, but I don't think any company should be allowed to have more than 33% of the total wireless phone frequencies.

BAD. If this deal is blocked then kisss OTA TV good bye. Verizon and at&t have been badgering the FCC for take more spectrum from OTA tv. If thios deal helps prevent that then I'm all for it. cable isn't using this spectrum anwyays why should they be allowed to haord it? At&t could have done this type of deal but decided that buying t-mobile would be better. That's their own fault.

NOCMan
MacChatter
Premium
join:2004-09-30
Colorado Springs, CO

Re: Good

This has nothing to do with OTA TV. This is spectrum the cable companies bid on and won to deploy wireless services that they have decided they don't want to get into that business.
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David
Now accepting new patients
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join:2002-05-30
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said by Automate:

I think the FCC should look at the deal also. I don't know how much Verizon has, but I don't think any company should be allowed to have more than 33% of the total wireless phone frequencies.

not your best argument I am afraid.. sprint/clearwire total own 203



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If you have a topic in the direct forum please reply to it or a post of mine, I get a notification when you do this.
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Weasleman

@telus.net

Not anti-competitive

Verizon specializes in wireless. The cablecos specialize in wireline broadband. Don't see anything anti-competitive here.

One question: Is VDSL2 cheaper to deploy on a per customer basis or DOCSIS 3?
NWOhio

join:2011-10-25
Toledo, OH

Re: Not anti-competitive

VZ does NOT specialize in wireless. CellCo Partnership does. which is a joint venture with Verizon and VodaFone.
slckusr
Premium
join:2003-03-17
Maumee, OH
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Reviews:
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Re: Not anti-competitive

said by NWOhio:

VZ does NOT specialize in wireless. CellCo Partnership does. which is a joint venture with Verizon and VodaFone.

christ dude get real, verizon is the public name get over it.Verizon is doing this because thats what the letterheads say.
Mr Matt

join:2008-01-29
Eustis, FL
kudos:1
Reviews:
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We will wind up with an internet trapped in Amber!

First there will be wild enthusiasm, then comes lethargy and then comes the list of reasons why customers will be subject to low monthly allotments with outrageous costs for those who go over their allotment, because we have to protect the network. Wireless would be the best thing since sliced bread if there were enough bandwidth to stream hundreds of HD Movies per cell site. Great deal for Verizon because there will be no investment in infrastructure just cell sites.

dathing

join:2002-01-09
Sykesville, MD

Not much different

So it's not OK for AT&T to buy a company for spectrum....

But it is OK to buy the spectrum from a company, thus preventing competition by putting a lock on that spectrum.

Thin.
WiWavelength

join:2011-11-16
Lawrence, KS

Re: Not much different

said by dathing:

So it's not OK for AT&T to buy a company for spectrum....

Are you not overlooking a few other reasons why AT&T wanted to buy T-Mobile? Infrastructure. Subscribers. Elimination of a national competitor.

AJ

footballdude
Premium
join:2002-08-13
Imperial, MO
said by dathing:

So it's not OK for AT&T to buy a company for spectrum....

But it is OK to buy the spectrum from a company, thus preventing competition by putting a lock on that spectrum.

Thin.

I thought exactly the same thing when this deal was announced. The BBR crowd was screaming like monkeys about the AT&T deal but hardly a word about Verizon.
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whataname

@iauq.com

Re: Not much different

said by footballdude:

I thought exactly the same thing when this deal was announced. The BBR crowd was screaming like monkeys about the AT&T deal but hardly a word about Verizon.

Considering that this is the first story, and that there are already a fair amount of grumbling posts, I would think this is a 100% premature statement to make. Especially considering the scope of the problems for competition are in a completely different scale - not that this deal doesn't have potential issues, but not nearly to the extent that the AT&T/TMobile deal had. Also keep in mind that part of the furor was caused by constant lies, bribery and scandal associated with that deal.
clone

join:2000-12-11
Portage, IN
Well, honestly, it's no secret that a lot of people on here have a grudge against AT&T, and most of them with good reason. I can't say I'm completely unbiased, either, but what Verizon did is purchase spectrum that was currently unused.

The cablecos bought that AWS spectrum in hopes of using it for mobile broadband, but the market has changed since 2006. It makes more sense to let a company that's in the business of wireless services to run it than a company that focuses on wireline services.

And yes, eliminating a mobile competitor is much different than buying wireless spectrum from a company that provides fixed communication services. Why do AT&T apologists always have to try to spin everything like AT&T is the poor underdog. They're not, and everyone knows it. That's why they got smacked down so hard in the T-Mo deal. People are sick of the lies.

If AT&T wants to change people's perception of them, then they need to just get out there and build a damn world-class wireless network and stop bellyaching. Then we can talk.

The cablecos have failed miserably at any attempt to enter the wireless market, anyway, so "Preventing Competition"? Thanks for the laugh.

THAT'S thin. Obvious bell shill.

CooKieCrmbls
ATT Direct
Premium
join:2007-07-30
Kissimmee, FL
Dynamite power tie, dathing... Doesn't seem from your aloofness that you are confusing Energy or Sustainability... Seems your generality torques folks off, though... Touche!

SomeVZGuy

@verizon.net

Master Plan..

This is all part of VZ's master plan to divorce themselves from its unionized workforce. By shifting customers to LTE / 4G wireless broadband as opposed to the now defunct & far superior FiOS product (and the type of revenue stream that only capping can provide), there's less people to share the wealth with - mainly those pesky IBEW / CWA types. Eventually, they'll swoop in to steal CATV customers the same way they're going to do it to the data customers of FairPoint, Frontier, etc. Wirelessly. These guys are the smartest people in the room, don't you know.

After they've got your TV and cellphone service, they'll arrange your cell to ring your home phones or port your POTS to cellular and mail you a little box to connect your wired phones. No installation or repair crews, or customer service reps for that matter. It will be all profit! Those good paying Verizon jobs will be gone as well as the money those workers spent in the community. Employers in communications fields can all offer lower wages as they no longer need to compete with Verizon wage tables to lure potential workers. We'll all be working for minimal wages - and unable to afford the products they market to us. This is just the beginning.
NWOhio

join:2011-10-25
Toledo, OH

Re: Master Plan..

and its their right.
CXM_Splicer

join:2011-08-11
kudos:1
Reviews:
·Verizon FiOS
Although I agree with the end result, I would say that getting rid of the workforce is not the goal but an added bonus. What they really want to get rid of is the infrastructure. Of course, they will still need a substantial fiber infrastructure to support the wireless sites but they will most likely contract maintenance out. They will still need CSR's but certainly less of them and they will probably be in Colombia or Korea.

When the NLRB becomes powerless on January 1st, I think we are going to see a LOT of changes to the workplace. Considering the current state of the country (economy, protests, new detention laws, etc.) I have a feeling things are going to get ugly... all brought to you by the Cock brothers (sp?) and their friends.

»topics.nytimes.com/topics/refere···dex.html

footballdude
Premium
join:2002-08-13
Imperial, MO

Re: Master Plan..

said by CXM_Splicer:

I have a feeling things are going to get ugly... all brought to you by the Cock brothers (sp?) and their friends.

Lol. You don't even know how to spell their name, but you know how to hate them. The term 'led around by the nose' seems to apply here.
CXM_Splicer

join:2011-08-11
kudos:1

Re: Master Plan..

Hahaha Yes, because with the entire Internet a my fingertips I am somehow unable to find the correct surname spelling for a couple of dicks. Please go forthwith to Wikipedia and look up Satire.
toolman90

join:2007-08-10
Cincinnati, OH
Reviews:
·Time Warner Cable

No competitive impact or anti trust violation

There is no competitive impact or anti trust violation. Cable companies are selling their frequences that they previously used for the failed Clearwire venture, to offer their mobile internet service. They made a deal with Verizon Wireless to sell their spectrium, in exchange for use of their towers for their wireless internet service.
WiWavelength

join:2011-11-16
Lawrence, KS

1 edit

Re: No competitive impact or anti trust violation

Double post deleted.
WiWavelength

join:2011-11-16
Lawrence, KS
said by toolman90:

There is no competitive impact or anti trust violation.

Ah, that is yet to be determined. This transaction/partnership could have a "competitive impact," could be an "anti trust violation" because it could concentrate too much supply (spectrum) in the hands of VZW and/or foster collusion among VZ and its would be cable competitors.

said by toolman90:

Cable companies are selling their frequences that they previously used for the failed Clearwire venture, to offer their mobile internet service.

SpectrumCo has nothing to do with Clearwire. SpectrumCo holds AWS 2100+1700 MHz licenses. Clearwire holds BRS/EBS 2500-2600 MHz licenses and leases. Those are two completely different spectrum bands.

AJ
toolman90

join:2007-08-10
Cincinnati, OH

Re: No competitive impact or anti trust violation

To me anti competitive means taking out another competitior not aquiring more speectrum for wireless service. I was under the impression that the spectruem was used for clearwire by the cable companies apparently I was wrong.
tmc8080

join:2004-04-24
Brooklyn, NY
Reviews:
·Optimum Online
·Verizon FiOS

recognition of a problem? 6 years later..

Verizon's acquisition of frequencies for LTE is of no surprise on their intent to build a national wireless network. What is disturbing is the lack of true competition in the market.

However, to NOW 6 years later recognize that telco vs cableco competition is dysfunctional outside the Verizon (WIRED) footprint is quite acting like a till of the hun by the DOJ. This comes YEARS after when they had ample time to weigh in on the AT&T / Bell South merger and all the repercussions that lack of competition by AT&T's upgrade path & decisions unfolded. DSL in any real-world form for the vast geography of the USA is far from a match made in heaven.. That's why Verizon eventually abandoned it's use for a triple play network-- which was the intent of the FCC '96 legislation (to encourage the biggest wired players to build [keyword for AT&T: FUTUREPROOFED!] DEEP LAST MILE AND/OR COMPLETE FIBER network solutions)... apparently AT&T never got that memo and was allowed to swallow Bell South lock-stock-and-barrel. Fast forward to today and AT&T's greed was allowed to fester by attempting to acquire Tmobile perked up the ears about the looming dysfunction in the Wireless market which they thought was remedied by lifeline service subsidy AND the prepaid market... a rose colored glasses fantasy to be sure.. afterall, congress was busy letting the banks & oil companies trash the US economy!

20mhz isn't as big a land grab as you might think. that said, there are other minority carriers such as Sprint, Metro PCS, Leap and others who DO NOT have the resources and/or spectrum to build a similar national network and suffer customer-wise outside their well established service areas (densely covered green zones on their coverage maps). The FCC should be making equitable spectrum available for purchase in adjacent blocks for these carriers for 4g data to supplement gsm/cdma which has been in OVERSUPPLY for about 5 years. The need for spectrum lies in the customer's demand for DATA/INTERNET service which is where the next logical battle for spectrum/market share/customers will rage (or not). Most of the problems are about money, FCC red tape, and finding a way to funnel this spectrum to those specific carriers without trying to show favoritism (in a way that AT&T and Verizon will cry foul with their lawyers). AT&T and Verizon walked away from the majority of the spectrum auctions with over 100 megahertz each which is about what they have today and oodles more which they SIT ON AND DON'T USE-- so the auction model will have to reform if you want fairness back in wireless asset distribution.
hoyleysox

join:2003-11-07
Long Beach, CA

Vague and full of inuendo

Freepress makes a weak attempt to persuade about what they think VZ and the cable "cartels" should do accept for lower prices.

joshuaren

@ascentdata.com

VZW vs. AT&T

the reason why this is okay and the AT&T deal wasn't is simply because I like Verizon.

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