Verizon Acquisition of Cable Spectrum Will be Approved

The U.S. Justice Department will drop its objections to the proposed Verizon purchase of spectrum from leading U.S. cable operators,  after the companies agreed in principle to limit the duration of the joint ventures to five years or less, after which they will have to reapply for antitrust clearance, people familiar with the discussions told the Wall Street Journal. 

Verizon and Comcast have also agreed not to implement the joint marketing agreement in areas where the two companies currently provide fixed network Internet, TV and phone services. As a practical matter, the firms would likely have done so in any case, to avoid drawing regulatory ire, it might be argued.

Under the new plan, Verizon Wireless stores won't sell Comcast's Xfinity service in regions where its parent company, Verizon Communications, already offers its FiOS service, for example.  That will alleviate concerns that the agency marketing deals effectively would end competition between cable and Verizon, in regions where they now compete head to head.

The new concessions mean that, as many had predicted, the agency deals will be aimed at AT&T and other competitors. Essentially, the new way the agency agreements are implemented will mean that cable operators can sell Verizon wireless products to bolster their triple play offerings, except where one of the cable companies competes with a Verizon fixed network. 

In some cases, cable companies will be able to sell Verizon Wireless products, while in other areas they cannot. The revised framework, in other words, does not represent, either for Verizon or the cable operators, a clear "in region only"or "out of region only" framework.