What $3.9 billion Verizon/cable spectrum deal means to you (FAQ)

The FCC approved Verizon's $3.9 billion bid to buy wireless spectrum from a group of cable companies. But what does the final deal hashed out with regulators mean for consumers?

by Marguerite Reardon
August 25, 2012 11:57 AM PDT


The Federal Communications Commission just gave the final approval for Verizon Wireless to purchase the biggest hunk of spectrum outside of a full company merger in U.S. history. So what's it all mean?

In December, Verizon proposed buying 20 MHz of wireless spectrum from a consortium of cable operators known as SpectrumCo, which included Comcast, Time Warner Cable, and Bright House Communications. It also struck a separate but similar deal to buy spectrum from cable operator Cox Communications.

The deal was controversial for two main reasons. First, it would have allowed Verizon to effectively double its spectrum holdings in the AWS-1 block. Many feared this would give Verizon too much control of a scarce resource at a time when other wireless operators without as strong a spectrum position also need access airwaves to deploy competing 4G services.

The second issue many consumer advocates had with the deal concerned a commercial arrangement that would allow cable operators to resell and market Verizon Wireless services and also allow Verizon to resell and market cable service. This concerned regulators and consumer advocates because it might kill competition in the wired broadband market.

After working closely with regulators, Verizon struck a deal with T-Mobile to sell it some spectrum, alleviating those concerns. And it worked with the Department of Justice to alter its commercial agreement to help protect broadband competition.

While regulators say they are satisfied with the protections put in place via conditions placed on the deal, what does it all really mean for consumers? What is likely to change in the near term as well as in the long term?

CNET has put together this FAQ to help explain what you can expect.
Now that the FCC has approved the deal between Verizon and the SpectrumCo cable companies what happens next? Are there any other approvals necessary?

The FCC was the last regulatory agency that had to sign off on the deal. The Department of Justice announced its support of the amended deal last week. Now Verizon and the cable companies are free to proceed with their transaction.

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