By Greg Bensinger
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones) -- Verizon Communications Inc. (VZ) said its $3.9 billion deal to buy a block of wireless airwaves, or spectrum, from a group of cable companies would benefit the public by bringing more mobile service to a broader swath of Americans as data-hungry iPhones and tablet computers force capacity constraints.
The telecommunications company faces opposition from rival T-Mobile USA, which said last month in a Federal Communications Commission filing that the sale would damage competition and allow Verizon to "accumulate even more spectrum on top of an already dominant position."
Verizon announced the deal as regulatory opposition mounted against AT&T Inc.'s (T) planned $39 billion takeover of T-Mobile, leading to the merger's collapse late last year. Analysts anticipate less resistance to the Verizon deal because the spectrum has been largely unused and wouldn't involve the transfer of customers.
The Verizon spectrum deal is at the center of a debate about how the scarce commodity should be apportioned among the largest carriers as the FCC nears authorization to auction off television airwaves. Carriers have argued vigorously for access to new spectrum as more consumers dial up high-definition video and download music and photos to their devices.
In an FCC filing released Monday, Verizon said the deal with Comcast Corp. (CSCSA), Time Warner Cable Inc. (TWC), Bright House Networks LLC and Cox Communications Inc. would help relieve the nation's congested networks. Verizon "faces spectrum constraints in its network in some areas as early as 2013 and in many more by 2015," according to the filing.
Verizon also said the FCC should drop its review of a separate marketing agreement in which its Verizon Wireless subsidiary and the cable companies would cross-promote their products in stores. The carrier noted the Justice Department is reviewing the marketing accord and that the FCC hasn't historically weighed in on such arrangements.
A Verizon spokesman declined to comment beyond the filing, and FCC representatives weren't immediately available.
Verizon Communications, which co-owns Verizon Wireless with Vodafone Group PLC (VOD, VOD.LN), recently added 31 cents to $38.99.
-By Greg Bensinger, Dow Jones Newswires; 212-416-4676; firstname.lastname@example.org
(END) Dow Jones Newswires
March 05, 2012 12:20 ET (17:20 GMT)
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