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The Internet Innovation Alliance is a broad-based coalition of business and non-profit organizations that aim to ensure every American, regardless of race, income or geography, has access to the critical tool that is broadband Internet. The IIA seeks to promote public policies that support equal opportunity for universal broadband availability and adoption so that everyone, everywhere can seize the benefits of the Internet - from education to health care, employment to community building, civic engagement and beyond.

The Podium

Blog posts tagged with 'Verizon'

Tuesday, January 14

Playing Both Sides of the Street

By Bruce Mehlman

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Wall Street and K Street are separated by a mere 225 miles, but for many companies they are worlds apart. In particular, industry observers would do well to compare everything said to policymakers with statements by the same competitors made to Wall Street investors. Defense companies, for example, warned policymakers that sequestion would spell the death of the defense industry, yet defense stocks more than doubled since the law prescribing the spending cuts was passed and defense players figured out how to deal with the changes, as they promised Wall Street they would. Telecom companies likewise present sometimes radically-divergent world views on K Street and Wall Street.

Take Sprint. In a January 7 filing at the FCC, Sprint argued that the special access market “in almost every part of the country does not support competition for core DS-1, DS-3 and similarly sized Ethernet channel termination facilities [.]” Sounds pretty dire. Unfortunately, in its conversation with the FCC, Sprint failed to include some other important facts it shared with its understandably-bullish investors. Specifically:

• Two years ago, Sprint entered the market for competitive alternatives for their back haul services to replace incumbent telephone company special access in its network – under the project name “Network Vision.”;

• Sprint initiated a competitive bidding process for its “Network Vision” project that it expected to have 25-30 “significant backhaul providers.”

• Following the competitive bid process, Sprint awarded numerous contracts for their backhaul services to competitive backhaul providers. In fact, in a filing at the FCC, Verizon confirmed that it bid for Sprint’s backhaul business in this process, yet was awarded only 6% of Sprint’s backhaul sites in Verizon’s incumbent telephone company footprint.

• Sprint recently provided details regarding its Network Vision project to the Securities and Exchange Commission, and noted in its 2013 10-K filing that “Network Vision will encompass approximately 38,000 cell sites. We have more than 13,500 sites on-air and have launched LTE in 88 cities. Further deployments of Network Vision technology, including LTE market launches and enhancements of our 3G technology, are expected to continue through the middle of 2014. We expect Network Vision to bring financial benefit to the Company through migration to one common network, which is expected to reduce network maintenance and operating costs through capital efficiencies, reduced energy costs, lower roaming expenses, backhaul savings, and reduction in total cell sites.

• In short, Sprint told the SEC not only that Network Vision was proceeding but that it expected further deployments through 2014.

Investors will reasonably conclude that the market is competitive for what Sprint terms “core DS-1, DS-3, and similarly sized Ethernet channel termination facilities.” And Sprint seems to have a reasonable competitive position and strategy that is proceeding apace. Good news for customers and investors, but tougher news for those aiming to perpetuate the perception that our highly-competitive telecommunications network lacks competition in the special access market.

Monday, January 06

Expecting a Ruling

By Brad

2014 is here, and the year ahead promises to be a big one in tech, beginning with a major court ruling that could shake things up in the next few days. As Kate Tummarello of The Hill reports, the D.C. Circuit Court of Appeals may soon rule on the FCC’s “net neutrality” rules:

Verizon argues the FCC cannot regulate Internet providers like traditional telephone companies and is hoping to triumph over the administration in the second most powerful court in the land.

A decision against the rules would be a blow to President Obama, who made net neutrality a campaign pledge in 2008. It would also erase one of the central achievements of former FCC Chairman Julius Genachowski.

Flashbacks to three years ago, anyone?

Friday, August 30

Potential Deal of the Day

By Brad

Verizon has flirted with purchasing European-based provider Vodafone for years now, and as Ryan Knutson, Spencer E. Ante, and Dana Cimilluca of The Wall Street Journal report, the talks have heated up again:

Verizon Communications Inc. \ and Vodafone Group PLC have rekindled talks about a buyout of the U.K. company’s stake in their U.S. wireless joint venture in a deal that would likely cost Verizon well over $100 billion, people familiar with the matter said.

Vodafone confirmed Thursday that it was in talks with Verizon to sell its stake, but said there is no certainty an agreement will be reached.

With competition in the U.S. hotter than ever, don’t be surprised if similar international deals start taking shape.

Friday, June 21

Keeping Mobile Broadband Booming

By Brad

In an op-ed for The New York Times, Verizon chairman and chief executive Lowell C. McAdam argues that a light regulatory touch has kept America’s wireless industry booming, and that if we’re going to continue leading the world in mobile broadband, that light regulatory touch needs to continue:

Fifty-six percent of American adults have smartphones that give them access to mobile broadband data and video. Our country is the center of a booming mobile ecosystem in which new devices and applications are being used to do everything from personal health monitoring and e-commerce to tracking deliveries and saving energy.

Contrast this with the European Union, where innovation and investment in advanced networks have stagnated under an onerous regulatory regime that limits investment and innovation, and where today only about 2 percent of households have access to broadband networks with 100-megabit-plus speeds. “Once, Europe led the world in wireless communication: now we have fallen behind,” Neelie Kroes, the European Union official responsible for broadband policy, said in a speech in January. “Europe needs to regain that lead.”

Friday, May 17

New Rules for a New Age

By Brad

In a speech before the Media Institute yesterday, Craig Silliman, Senior Voce President of Public Policy for Verizon, argued that outdated regulations risk holding back innovation and investment. It’s a similar argument other telecom providers have made recently. As Silliman told the crowd:

[W]e need to ensure is that we do not let an increasingly outdated regulatory regime for the Internet ecosystem slow innovation and investment. The 1996 Telecom Act succeeded in what it was designed to achieve, but almost two decades later it is leaving the FCC struggling to shoehorn Internet-era technologies into phone-era regulations. I am not suggesting that the answer is to abolish all regulation. But I am suggesting that we need a 21st century policy framework that is designed for 21st century technologies and marketplaces, not 19th century ones.

We need to start by asking the right questions. It has been suggested that a key question for the next FCC chairman will be how to keep the FCC relevant in the Internet era. I believe that is the wrong question. I recognize, of course, that tactical battles to secure budgets and resources are part of any organization or entity, including the federal government. But a strategic view of policymaking starts by asking what objective we are trying to achieve, and then asking whether regulation is needed, why it is needed, and who is best placed to administer it.

The full speech is worth checking out.

Thursday, April 11

Video on the Go

By Brad

Via Sue Marek of Fierce Wireless comes a staggering number from Verizon:

Video accounts for 50 percent of Verizon Wireless’  network traffic today and by 2017 the carrier estimates video will make up two-thirds of all traffic over the network. Speaking at the National Association of Broadcasters conference here yesterday, Verizon Communications CEO Lowell McAdam said that the company’s investment in its LTE network is what is making the delivery of that video possible. “With 3G you have video clips but there is buffering. With 4G you can stream video,” he said.

50% of wireless traffic and counting. Wow.

Friday, February 01

Working Together

By Brad

How important is spectrum to the wireless industry? So important that normally fierce competitors are working together. As Phil Godstein of Fierce Wireless reports:

AT&T Mobility, Verizon Wireless and T-Mobile USA inked an agreement with the Department of Defense to explore the possibility of sharing 95 MHz of spectrum that is currently used by the Pentagon and other federal agencies located in the 1755 - 1850 MHz band.

The announcement comes as the FCC and National Telecommunications and Information Administration encourage spectrum sharing between commercial and government users as one way to meet Americans’ seeming insatiable demand for mobile broadband.

So far, Sprint is sitting out the agreement, though Goldstein notes they will “follow the group’s work.”

Friday, December 07

A Warning on Regulations

By Brad

With Verizon’s challenge to the FCC’s net neutrality order still making its way through the courts, John Eggerton of Broadcasting & Cable reports at least one Commissioner is worried the outcome could lead to more regulation of the Internet:

If a D.C. federal appeals court upholds the FCC’s network neutrality rules, Republican commissioner Ajit Pai expects the Democrat-led commission to expand regulation of the Internet, including into the mobile wireless space and usage-based pricing.

That came in a speech to the Phoenix Center in Washington on Thursday, according to a copy of the text.

Commissioner Pai also stated that any attempt to reclassify broadband under Title II would “dramatically slow broadband deployment.”

Monday, November 19

Regulations and Free Speech

By Brad

As Verizon continues to battle the FCC’s net-neutrality regulations in court, the company has argued the rules are a violation of first amendment rights. This, Brendan Sasso of The Hill reports, is not sitting well with some Democratic House members:

Three top Democrats on the House Energy and Commerce Committee wrote a letter to their colleagues on Friday, calling attention to a “troubling” constitutional argument Verizon has made in its bid to overturn net-neutrality regulations.

Democratic Reps. Henry Waxman (Calif.), Anna Eshoo (Calif.) and Edward Markey (Mass.) warned that Congress’s power to regulate the communications industry would be severely restricted if the court accepts Verizon’s claim that the net-neutrality regulations violate its First Amendment free speech rights.

Friday, August 24

Spectrum Deal Gets the Thumbs Up

By Brad

Last week, Verizon’s bid to purchase spectrum from cable companies got the nod from the Justice Department. Yesterday the FCC weighed in. Via Brendan Sasso of The Hill:

The Federal Communications Commission (FCC) has approved Verizon’s $3.6 billion purchase of cellular frequencies from the nation’s largest cable companies.

The five commissioners voted unanimously to approve the deal on Tuesday, and the order was publicly released on Thursday.

Approval didn’t come free from hitches, however:

FCC Chairman Julius Genachowski said the original deal “posed serious anti-competitive concerns and would not serve the public interest.” But he decided to approve it after the companies agreed to a series of concessions.

Genachowski argued that the “substantially modified transaction” will give customers access to more spectrum for mobile broadband, while preserving competition.

Friday, August 17

Approval From the DoJ

By Brad

After months and months of lobbying and negotiations, Verizon has received a nod of approval from the Justice Department for its $3.9 billion spectrum deal with cable providers. Sinead Carew and Jasmin Melvin of Reuters report:

The U.S. Department of Justice said on Thursday it would approve the spectrum sale, and the head of the Federal Communications Commission said the commission should also give the deal the go-ahead.

The spectrum purchase will give Verizon Wireless additional capacity to help it cope with rising demand for video on mobile devices and data services such as Web surfing.

Approval for the deal came with conditions, however:

The Justice Department said on Thursday that it wanted changes to Verizon Wireless’s commercial agreements with the cable companies under which they planned to market each other’s services and form a technology joint venture.

For example, the Justice Department said in a settlement proposal it filed that Verizon Wireless should not be allowed to market cable company products in areas where its parent, Verizon Communications Inc, sells FiOS television and Internet services that compete with those of cable providers.

The department also said that it would limit the duration of the proposed technology venture so that it would not “dampen the companies’ incentives to compete against one another.”

It also said that the companies should tweak their service resale agreement so that cable companies would be allowed to sell services from Verizon Wireless rivals after five years.

Friday, August 03

Rough Road to Approval

By Brad

It’s not secret that the explosive growth of mobile broadband has forced wireless providers to search for more spectrum due to looming capacity constraints. For Verizon, that search has led to a proposed deal with cable companies, but as Diane Bartz of Reuters reports, the company’s road to regulatory approval is a rocky one:

Verizon Wireless may need to agree to tough conditions to win approval for its deals to buy spectrum from cable companies and market each others’ products, according to three sources knowledgeable about the negotiations.

The Justice Department and Federal Communications Commission are reviewing plans by Verizon Wireless, the biggest U.S. mobile provider, to buy spectrum from a consortium of cable providers, including Comcast (CMCSA.O) and Time Warner Cable (TWC.N), for about $3.9 billion. The transactions were proposed in December.

While the Justice Department and FCC appear prepared to approve the spectrum portion of the deals with minor adjustments, antitrust regulators have sought strict limits on controversial side deals.

Thursday, July 05

Dropping the Challenge

By Brad

When the FCC announced its net neutrality rules two years ago, major Internet provider Verizon was quick to challenge them in court, pushing for a lighter regulatory touch. On the other end of the spectrum, advocacy group Free Press was also quick to challenge the rules, long calling for the FCC to enact expanded regulations.

Now, Brendan Sasso of The Hill reports, the group has dropped its court challenge in order to “direct our resources elsewhere in the continued campaign to preserve the open Internet.”

Tuesday, July 03

Challenging the FCC

By Brad

Verizon is still seeking FCC approval for its proposed spectrum deal with cable companies, but that’s not stopping the wireless provider from continuing to fight the Commission’s net neutrality rules in court. As The Hill‘s Brendan Sasso reports:

In Monday’s filing, Verizon argued that instead of “proceeding with caution” in light of the Comcast ruling, the FCC adopted rules that “go even farther than its prior action and impose dramatic new restrictions on broadband Internet access service providers.”

“Here again, the FCC has acted without statutory authority to insert itself into this crucial segment of the American economy, while failing to show any factual need to do so,” Verizon wrote.

The company argued that Congress never authorized the FCC to regulate Internet access and that the agency acted without sufficient evidence to suggest the rules were necessary.

Verizon claimed that the rules violate its First Amendment free speech rights.

According to Sasso, the FCC’s legal response to the suit should arrive in September.

Monday, June 25

Spectrum Swap

By Brad

With its spectrum deal with cable companies still receiving government scrutiny, Verizon has announced a proposed swap of airwaves with competitor T-Mobile. As Brendan Sasso of The Hill reports:

The deal includes some of the spectrum that Verizon is trying to buy from a coalition of cable companies, including Comcast and Time Warner. Verizon and T-Mobile will only complete their deal if regulators first approve the Verizon-cable transaction.

By selling some spectrum to T-Mobile, the smallest national carrier, Verizon could boost its hopes of winning regulatory approval for its $3.6 billion deal with the cable companies.

Friday, June 08

A Slow Process

By Brad

Yesterday, Verizon CTO Tony Melone criticized the FCC’s pace when it comes to freeing up much-needed spectrum for wireless. As CNet’s Marquerite Reardon reports:

Melone said the FCC needs to speed up the process for approving spectrum sales and license transfers in the secondary market. He used his company’s own bid to buy wireless spectrum from a consortium of cable companies—collectively known as SpectrumCo—as an example. In December, Verizon promised to pay $3.6 billion for nearly 20 MHz of wireless spectrum in the AWS band.

The FCC and Department of Justice are reviewing the transaction, which also includes a co-marketing deal, which some critics say is anti-competitive. The agencies have been reviewing the deal since December when it was announced and are expected to finish up their inquiry by the end of July.

Melone said that he thinks the process, which is expected to take a little over six months, is too long. And he said it’s a barrier to getting unused wireless spectrum into companies that can put it into use. And he criticized the agency for taking too long to evaluate the transaction.

Given the increasing demand for mobile broadband — and the FCC’s own warnings that we will soon be hitting a “spectrum crunch” — it’s easy to see why Melone and other wireless providers are frustrated with the slow pace of the Commission’s process.

Thursday, May 24

A Close Examination

By Brad

As Verizon’s $3.6 billion proposal to purchase spectrum from various cable companies continues to be examined by both the FCC and the Justice Department, The Hill‘s Andrew Feinberg reports Sen. Heb Kohl, head of the antitrust subcommittee of the Senate Banking Committee, wants the deal to be run through with a fine-toothed comb:

In a letter addressed to FCC Chairman Julius Genachowski and Attorney General Eric Holder, Kohl makes clear that he’s not prejudging the deals to be unlawful under the Communications Act or antitrust laws. But he also makes clear that he believes the transactions should be “examined closely” because they present “serious competition concerns.”

Wednesday, March 21

Before Testifying Before the Senate

By Brad

In anticipation of the Senate Judiciary Subcommittee on Antitrust, Competition Policy, and Consumer Rights hearing on the proposed spectrum deal between Verizon and cable companies, Comcast’s Executive Vice President David Cohen has previewed his testimony on the company’s public policy blog:

The spectrum license transfers are consistent with the Communications Act, FCC rules, and the antitrust laws. They also will further the spectrum policy goals of Congress, the Administration, and the National Broadband Plan. Neither the License Assignment nor the Commercial Agreements reduce or harm competition in any product or geographic market. In fact, the agreements will offer further competition and innovation in the marketplace.

Friday, March 16

A Day Before the Senate

By Brad

Broadcasting & Cable’s John Eggerton reports  a date for a hearing on Verizon’s proposed spectrum deal with cable companies has been set:

The Senate Judiciary Committee’s antitrust subcommittee, chaired by Herb Kohl (D-Wis.), has slated its planned hearing on Verizon’s purchase of cable spectrum for March 21. The hearing title sets up the debate: “The Verizon/Cable Deals: Harmless Collaboration or a Threat to Competition and Consumers?”
According to the hearing notice, the witnesses will include top execs from Verizon and SpectrumCo principal partner, Comcast, as well as academics and public interest representatives.

Friday, March 09

Debating a Spectrum Deal

By Brad

While efforts to allocate more spectrum for wireless use are moving forward at a relatively slow pace, The Hill‘s Brendan Sasso reports one company’s efforts to bolster its amount of spectrum is facing hurdles with the FCC:

The Federal Communications Commission (FCC) announced Thursday it will probe portions of the agreement between Verizon and a coalition of cable companies to cross-sell each other’s services as part of its broader review of the companies’ spectrum deal.

“After an initial review of the proposed spectrum license transfers as well as the commercial agreements between Verizon Wireless and several cable companies, the Commission staff has concluded that portions of the commercial agreements are inseparable from the proposed license transfer and related wireless competition issues,” an FCC spokesman said. “Consequently, those portions of the commercial agreements will be examined within the license transfer proceeding.”

Earlier this week, Sasso also writes, Verizon argued the FCC “lacks the legal authority to review the commercial deals.” The commission, obviously, disagrees. Stay tuned…

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