Verizon purchase of spectrum highlights need for inventory


While the FCC and Congress hunker down and try to push through a spectrum package involving the auction of spectrum in the television band, one of the major wireless consumers of spectrum just announced a deal to acquire $3.6B worth that was being “warehoused” by cable companies. Inquiring minds want to know just how much more capacity is out there lying fallow.

Verizon is set to invest in well over 100 licenses to operate between 1700 MHz and 2100 MHz, getting the spectrum from three large cable companies: Comcast, Time Warner Cable and Bright House.

Verizon is touting the acquisition as a positive development, which would take spectrum that had been gathering dust in the MVPD’s warehouses and putting it in the hands of the company with the motivation and wherewithal to put it to good use.

Verizon CEO Lowell McAdam told Communications Daily that it is just beginning to discuss the proposed acquisition with the FCC.

“We feel good about it from another perspective,” he told CD, “because as we have talked with the FCC, we have found that one of the problems was there is a lot of spectrum that has been warehoused and this takes spectrum with no plans for commercial service and gets it into the hands of somebody who will use it and allow additional investment and development.”

RBR-TVBR observation: Even though in terms of the national deficit, the incentive auction scheme’s potential cash benefit to the government is a raindrop in the ocean. But it has had the misfortune of being linked to deficit reduction nonetheless, which is preventing a calm and rational approach to difficult and highly technical issues.