House Democrats Take Interest In Verizon's Airwaves

By Steve Anderson April 27, 2012

The story of Verizon's plans to buy a chunk of wireless spectrum has taken a new turn as Democrats in the U.S. House of Representatives have called for a hearing to discuss Verizon's plans. Specifically, they plan to deal with the implications of Verizon, the current leader in wireless, taking over $3.6 billion in airwaves from cable providers like Comcast and Time Warner Cable.

Verizon's plan could have some very unsettling impacts on the market, according to Democrats, and the hearing would therefore be merited as far as they're concerned.

The initiative was started by California's Henry Waxman and Anna Eshoo, who took their concerns to Michigan Republican Fred Upton, current chairman of the Energy and Commerce Committee, as well as Oregon Republican Greg Walden, chairman of the House Subcommittee on Communications and Technology. They were quick to point out, however, that they had not taken a position on the purchase itself; they simply called for a hearing.

Of primary concern is competition. Critics have previously said that the Verizon deal would concentrate too much wireless bandwidth in Verizon's hands, and result in higher prices via decreased competition, as Verizon would simply have too much bandwidth to allow competitors into the market.

Yet Verizon has already been on record saying extra bandwidth is simply a necessity as more mobile devices emerge into the marketplace, placing greater demands on bandwidth for seemingly everyday applications like streaming video and video chatting.

On this point, major providers would be seen to agree with Verizon. Recent reports suggested T-Mobile was looking to put fully $4 billion into enhancing its network, and Sprint is also embarking on a plan to overhaul and expand its own network coverage. AT&T's plans to expand its network haven't been so publicly announced, but it's a near certainty that they're there. And Verizon's plan to sell some of its current spectrum once the cable deal goes through should give lawmakers some pause in terms of preventing a deal, though T-Mobile had already been seen as saying that the plan to sell wouldn't make matters much better for the competition.

It's a difficult balancing act lawmakers face; people want more bandwidth. The United States, at last report, badly lags behind the rest of the world in terms of speeds and coverage – the kind of thing that requires investment on the part of providers.

But allowing any one provider to get a clear edge will likely result in customers jumping ship and going to that provider, creating an environment that at least looks like monopoly to a casual viewer. More bandwidth is important. More bandwidth in one company's hands could be disastrous.

Edited by Braden Becker

Contributing TechZone360 Writer

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