FCC Wireless Chief Meets T-Mobile on Verizon Deal With Cable

A U.S. official leading regulatory review of Verizon Wireless’s proposed $3.6 billion purchase of airwaves from cable companies met with T-Mobile USA Inc. executives at the company’s headquarters and heard criticism of the deal.

Rick Kaplan, chief of the wireless bureau of the Federal Communications Commission based in Washington D.C., met April 19 at T-Mobile’s suburban Seattle offices in Bellevue, Washington, where he spoke with Chief Executive Officer Philipp Humm, according to an April 20 filing posted on the agency’s website. Kaplan also spoke to the Washington Technology Industry Association trade group while in the Seattle area.

Verizon, the largest U.S. mobile provider, announced in December the purchase of unused airwaves from a group led by top U.S. cable company Comcast Corp. (CMCSA) and No. 2 Time Warner Cable Inc. (TWC) The companies pledged joint marketing on the deal, which faces FCC and Justice Department review.

T-Mobile, the No. 4 U.S. mobile provider, asked regulators to block Verizon’s purchase, saying it would result in too concentrated ownership of airwaves for mobile calls and data. The Deutsche Telekom AG (DTE) unit was a the target of a failed takeover bid last year by No. 2 U.S. wireless carrier AT&T Inc. (T)

Verizon hasn’t used some airwaves it holds, and buying more from cable companies would add to “unused spectrum inventory,” T-Mobile executives including Humm told Kaplan, according to the filing. Verizon’s plan announced April 18 to sell other airwaves if its deal with cable companies succeeds “does not mitigate” harm caused by the deal, T-Mobile executives said.

‘Ignores Facts’

T-Mobile “ignores facts on the ground, the state of the wireless marketplace and the needs of consumers who will clearly benefit from this purchase of spectrum,” said Ed McFadden, a Washington-based spokesman for Verizon, in an interview.

Opponents have said the deal with Comcast and Time Warner would bring less competition and higher prices. Verizon says the spectrum purchase will bring it airwaves needed to meet soaring demand from smartphones and data-hungry tablet computers such as Apple Inc. (AAPL)’s iPad.

The FCC also is examining Verizon Wireless’s proposed $315 million airwaves purchase and cooperation agreement with Cox Communications Inc.

Verizon Wireless, based in Basking Ridge, New Jersey, is 55 percent-owned by Verizon and 45 percent-owned by Vodafone Group Plc (VOD), based in Newbury, England.

To contact the reporter on this story: Todd Shields in Washington at tshields3@bloomberg.net;

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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