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FCC clears ‘substantially modified' Verizon AWS deal

Fri, 08/24/2012 - 3:02pm
Maisie Ramsay, Wireless Week

The FCC has officially approved Verizon Wireless' AWS deal, sealing a transaction that gives the operator a substantial amount of spectrum for its LTE network.

The commission released its final order clearing the spectrum sale yesterday. The document formalizes a number of Verizon's voluntary commitments around divestitures, network construction and data roaming.

The move was expected after Commission Chairman Julius Genachowski voiced his support last week. The Justice Department also reached a settlement with Verizon at the same time, clearing the government's antitrust review.

Genachowski said the transaction, which allows Verizon to acquire $3.9 billion worth of AWS spectrum from four cable operators, was "substantially modified" from its original version.

Along with the AWS transaction, the FCC also cleared a smaller transaction between Verizon and Leap Wireless International.

Verizon's purchase of more than 150 AWS licenses from Cox Communications, Comcast, Time Warner Cable and Bright House Networks compliments its existing AWS holdings, giving it a nationwide footprint in the band. It plans to use the AWS spectrum to add capacity to its LTE network.

Under the FCC's conditions, Verizon must meet build-out requirements to provide service to at least 30 percent of the population covered by the AWS licenses within three years, and expand service to 70 percent within seven years. Verizon must offer data roaming to its competitors "on commercially reasonable terms and conditions" for the next five years.

It will also provide semi-annual reports about trends in its DSL customer base as it moves forward with plans to cross-sell services with the cable companies it is buying the AWS spectrum from.

Finally, Verizon is being required to complete its spectrum swap with T-Mobile USA within 45 days after the close of the AWS deal. The license exchange spans 218 markets and will give T-Mobile spectrum covering 60 million people in several top markets.

The DOJ's conditions require Verizon to significantly scale back its partnerships with the cable operators.

Now that the book is closed on the AWS deal, Verizon said it will move forward with its promised sale of its lower 700 MHz A block and B block licenses. The operator reports that 65 companies are interested in the licenses. Verizon is using its 700 MHz C block spectrum for its LTE network, but has not put its A block and B block licenses to use.

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