Policy

CWA Slams Verizon/SpectrumCo Approval as Job Killer

8/23/2012 5:07 PM Eastern

Reaction from critics of the Verizon/SpectrumCo deal were quick to register their disapproval Thursday after the FCC released the order approving Verizon Wireless' $3.9 billion purchase of spectrum from some major cable operators.

The Communications Workers of America, which had worked hard to block the spectrum sale, said it was a case of government serving the interests of business rather than consumers. FCC chairman Julius Genachowski has repeatedly said he sees the FCC as a consumer-focused agency, and Thursday indicated he thought the deal, with its modifications from Justice and the FCC, was consumer friendly.

CWA did not, using the terms "kill" (jobs) and "harm" (consumers) to describe the deal. "The FCC's decision allowing Big Cable to virtually monopolize wireline and video connections to millions of homes will lead to job loss and hit consumers with higher prices," said the group. "It will slam the door on our country's high speed future because it has destroyed any incentive for Verizon to continue the build out of its high speed FiOS network."

CWA said the FCC and Justice appeared content with an anticompetitive deal that cost jobs and raised prices. Among the conditions were time, and other limits on cross marketing agreements between Verizon Wireless and cable operators, but CWA said they were weak and added it was unclear how they would be enforced.

Free Press was somewhat gentler in its criticism. It gave the FCC and DOJ some credit for addressing some of the worst concerns raised by the group, and was even pleased by some of the order, though it concluded that "consumers would be far better off if this union had never been proposed."

"The best part of today's order is that, after years of turning a blind eye to problems of spectrum hoarding, the FCC has finally recognized the problems that consolidation produces in the market for mobile services," said policy adviser Joel Kelsey in a statement. "If we want the kind of vigorous competition that helps consumers find lower priced services, the FCC must pursue a strategy to allow more efficient, fair and open use of the public airwaves."

Free Press praised the spinoff of some of that advanced wireless spectrum to T-Mobile, which was a condition of the deal, and said he was "pleased" by the "strong data roaming requirements imposed on Verizon. These conditions will help by giving other wireless providers access to the spectrum they need to compete on price with the twin bells, Verizon and AT&T."

Verizon Wireless must abide by the FCC's data roaming order even if the company's court challenge success, much as Comcast has to abide by the FCC's net neutrality rules as a condition of its NBCU purchase, even if those rules also fall in court. Coincidently, it is Verizon, not Comcast, that is also challenging those rules in court.

The Alliance for Broadband Competition was another group that took a half a loaf from the table.

"Our alliance of competitive carriers, trade associations, public interest groups, and other entities continue to have deep concerns about the future of the competitive communications landscape," it said. "While the FCC's Order does not go far enough to ensure a competitive landscape, we are pleased that the Order addresses some of the concerns that we have raised with the Commission over the past several months."

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