AT&T Buy of Qualcomm Spectrum Another Step Toward Wireless Duopoly, Critics Say
The Rural Telecommunications Group, the Rural Cellular Association and public interest groups separately asked the FCC to reject AT&T’s application to acquire six D block and five E block licenses in the Lower 700 MHz band from Qualcomm. Several smaller carriers said the transaction should be approved, but only if the FCC takes other steps to promote competition. AT&T announced the $1.93 billion deal in December. Qualcomm originally bought the spectrum for its mobile TV service, which it’s shutting down.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
RTG said AT&T’s acquisition of more 700 MHz spectrum would be anti-competitive. “If the transaction is approved, AT&T and Verizon will control all of the cellular and 700 MHz band licenses (a.k.a. ‘beachfront spectrum') in most of the largest markets in the country as well as many rural markets,” RCA said. “Such duopolization to date has resulted in anticompetitive harm to wireless carriers and their customers, and has had the effect of driving some smaller carriers out of business.” RTG said if the FCC decides to approve the deal, it should at the least require AT&T to offer data roaming “on reasonable terms and conditions (including rates) and on any compatible air interface technology,” prohibit handset exclusivity agreements with AT&T and require that all wireless devices be interoperable across the 700 MHz band.
"Put simply, the wireless industry is marching towards duopoly,” RCA said. “AT&T’s pattern of spectrum acquisition to date already has created or imminently threatens significant harm to competition industry-wide, including foreclosing actual and potential competitors from acquiring needed spectrum; impairing device interoperability; and limiting the ability of consumers to enjoy the seamless voice and data roaming that they demand.”
A coalition of public interest groups led by Free Press said the FCC should instead reallocate the Qualcomm spectrum to unlicensed use. “The burden of proof in this proceeding lies with the applicants, who have failed to show that the proposed transfer serves the public interest,” the groups said. “The risks posed by the transaction are too great, and its potential benefits are too few, too speculative, and will take too long to take effect.” Consumers Union, the Media Access Project, Public Knowledge and the New America Foundation’s Open Technology Initiative signed off on the filing.
T-Mobile said the proposed deal emphasizes the importance of the FCC making additional spectrum available to other carriers for wireless broadband. If the commission approves the transaction it should also “expeditiously complete its ongoing spectrum inventory and immediately commence proceedings to reallocate spectrum that it identifies in the inventory as appropriate for reallocation; work with NTIA to achieve the reallocation of government spectrum for commercial use, beginning with the 1755-1780 MHz band; and issue a Notice of Proposed Rulemaking to open discussion on service and auction rules for the Upper 700 MHz D Block,” T-Mobile said.
U.S. Cellular supported the transaction but with conditions. USCC requested that the FCC set power and height limits for transmitters used by AT&T. “USCC expects that this alteration of height and power will mitigate interference into the Lower 700 MHz A block receive band, as claimed by AT&T Mobility, and, in addition, will have operational benefits for all licensees of Lower 700 MHz 3GPP Band Class 12 spectrum including USCC,” the carrier said.
Dish Network also opposed the deal, saying it will “hinder competition and fail to provide adequate public interest benefits.” Cellular South urged the FCC to impose conditions similar to those advocated by RTG if it approves the transaction. The Wireless Bureau sought comment on the deal Feb. 11 and petitions to deny were due Friday.