The Department of Justice's antitrust division is investigating Verizon Wireless' proposed deals to acquire Advanced Wireless Services spectrum licenses from Comcast, Time Warner Cable, Cox Communications and Bright House Networks, according to published reports.
Comcast, Time Warner Cable and Bright House on Dec. 2 announced a landmark agreement with Verizon Wireless, under which the MSOs are proposing to sell the carrier 122 AWS licenses for $3.6 billion. In addition, the cable companies will resell Verizon Wireless products and services and vice versa. Cox announced a similar deal with Verizon Wireless last Friday, with a proposal to sell its AWS holdings for $315 million.
The DOJ's probe is focused on whether the deals would give Verizon Wireless too much power in the wireless market, as well as whether the marketing agreements between the carrier and the cable companies violate antitrust laws, Bloomberg reported Tuesday, citing an anonymous source.
"My understanding is that it's the deal that we're looking at. We're looking at the proposed deal," DOJ spokeswoman Gina Talamona told Reuters.
Verizon spokesman Ed McFadden said in an email, "We've received no information on which to comment." Verizon Wireless, the largest mobile carrier in the U.S., is a joint venture of Verizon and the U.K.'s Vodafone.
In October 2006, SpectrumCo -- a joint venture comprising Comcast, TWC, Cox, Bright House and Sprint Nextel -- paid $2.37 billion for 137 AWS licenses in an FCC auction. Sprint exited the venture in 2007, while Cox sold its SpectrumCo stake in 2009 and retained AWS licenses in its cable footprint. Excluding the Cox licenses, the total SpectrumCo paid was $2.2 billion.
Verizon Wireless and the cable companies earlier this week applied to the FCC for permission to transfer the licenses, arguing that the FCC's review should be expedient and limited since there are no anticompetitive effects. They also said that the spectrum transfers "comply with all Commission rules, require no waivers, and will not result in any violation of the Communications Act or any other applicable statutory provision."
Separately, AT&T on Monday announced that it was abandoning its $39 billion bid to acquire T-Mobile USA.
-- John Eggerton contributed to this article.