Scrutiny has mounted in recent months over Verizon's deal to purchase $3.6 billion of spectrum from SpectrumCo — a joint venture of Comcast, Time Warner Cable, and Bright House — and today at 2PM EST the US Congress' Senate Judiciary Committee will hear testimony from Verizon about the deal. In its testimony today, Verizon plans to argue that its deal will not harm consumers, and it claims that "no customer will see fewer choices or increased prices as a result." The deal includes agreements that will allow the companies to sell Verizon's wireless service directly and to offer service using wholesale Verizon spectrum if they so choose, and that will allow Verizon to offer cable services. Verizon argues that it faces a spectrum crunch by 2014, that it uses spectrum twice as efficiently as T-Mobile, and that aside from this deal, "there's currently no other place to go to buy spectrum." But critics of the deal dismiss Verizon's consumer benefit claims.
Opponents of the deal argue that the mobile broadband market is converging on a duopoly, and point to Verizon and AT&T's profit share and pricing. Policy group Free Press plans to testify against Verizon, claiming that the deal will "divide the market for at-home wireline broadband," and allow Verizon Wireless with the ability to "stave off any serious competition threat in the wireless marketplace." Steven Berry, President of RCA, is set to testify today that "from a wireless industry perspective, Verizon Wireless will continue to grow stronger, the viability of competitors will be further stressed, and four potential new entrants will be eliminated as the march to duopoly continues." Berry argues that "these deals must be conditioned, or they must be stopped" -- otherwise, he says, "new regulations to artificially create the benefits of market competition will be required."
The deal is still subject to regulatory approval from the FCC, and Verizon may need to evade antitrust scrutiny from the Department of Justice, which recently killed the AT&T / T-Mobile merger. And according to Charles Rule, an antitrust lawyer testifying today, the DOJ will be investigating the deal "for several more months."