Senators Weigh Verizon-Cable Spectrum Deals

Sen. Kohl holds out judgment on MSO pacts

Sen. Herb Kohl (D-Wis.), the influential lawmaker who blasted the AT&T and T-Mobile merger, remains undeclared about his intentions on Verizon's pending spectrum deal with four cable companies.

"We have strong concerns. We aren't passing on it, or we wouldn't have had this hearing. But there's no letter to the Department of Justice yet," Kohl told Adweek following a two-and-a-half-hour hearing before his Subcommittee on Antitrust, Competition Policy and Consumer Rights. "It's too soon. This was a time to listen," Kohl added. 

Verizon's $3.9 billion deal for spectrum, which includes a joint venture and cross-marketing agreements with Comcast, Time Warner Cable, Bright House and Cox Cable, has been almost as controversial as AT&T's failed attempt to buy T-Mobile. But unlike the AT&T deal, the impact of the Verizon-cable agreements is less clear-cut because Verizon plans to cross-market services with its former rivals and create a joint venture to develop new ones.

"Many now wonder if these agreements … amount to a truce between one of the two largest phone companies and over 70 percent of the cable TV industry," Kohl said in his opening statement.

At least one member of the subcommittee has already made up his mind that the Verizon-cable deal as it stands is a problem for competition in the wireless business. "I'm skeptical," said Sen. Al Franken (D-Minn.). "It's almost like you guys got in a room and threw in the towel on competition."

Though Congress has no authority to block deals, it does wield influence. "We hope regulators at Justice and the Federal Communications Commission will examine the record from this hearing as they decide whether to approve this deal and in what form," said Kohl at the conclusion of a hearing.


Publish date: March 21, 2012 © 2020 Adweek, LLC. - All Rights Reserved and NOT FOR REPRINT