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Verizon Wireless Must Clear Justice Roadblock in Cable Deals

By Josh Long
July 13, 2012 - News

Verizon Wireless is facing heat from U.S. antitrust officials in Washington, D.C., over concerns co-marketing agreements between the mobile-phone giant and cable companies could hurt competition.

Those concerns are holding up Verizon Wireless' related multibillion-dollar deal to acquire spectrum from cable companies, The Wall Street Journal reported.

Sources told the Journal antitrust officials have made it clear they aren't like to clear the airwaves deal unless changes are made to alleviate concerns over the cross-marketing agreements. Justice Department officials are said to be worried that the agreements mean the companies have agreed not to compete for Internet users in each other's territories and could leave many Americans with a single option for broadband service.

Verizon Wireless and the cable companies – including Comcast – have agreed to co-market each other's landline phone, Internet, television and wireless services. Some critics have told the Federal Communications Commission that the collaborative effort could hurt competition and that Verizon Wireless' parent, Verizon Communications, will rely on the agreements rather than continue to build out its high-speed "FiOS" network, which competes with the cable companies.

Meanwhile, several sources told the Journal that FCC Chairman Julius Genachowski is preparing to recommend approval of the spectrum license transfers. Verizon Wireless has agreed to acquire 122 spectrum licenses from a cable consortium that includes Bright House Networks, Comcast and Time Warner Cable. Cox also is selling 30 licenses to Verizon Wireless.

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