Technology: Comcast, Time Warner officially give up on wireless
Verizon Wireless' announcement Friday that it was buying the airwaves previously gobbled up by the country's leading cable TV operators confirmed at least one truism: Never count on the cable industry to make a big, bold investment in technology.
It's worth remembering that when Comcast, Time Warner Cable and other top cable operators acquired the spectrum in 2006, they didn't promise to do anything with it. The practically promised the opposite, in fact:
The licenses provide many options and significant flexibility as the SpectrumCo partners evolve their plans for wireless. The members of SpectrumCo did not approach this investment with the intent of becoming the nation's fifth wireless voice provider, but to obtain greater flexibility in developing options for more advanced wireless services. While no plans have as yet been finalized, including no specific plans to build out the networks at this time, in coming months the members of SpectrumCo will fully evaluate all options including possible testing in limited markets.
The press release went on to note how the cablers had gotten the spectrum for a relative bargain. Sure enough, they appear to be selling the licenses at a significant markup, showing again that these guys really know how to extract value from a public resource.
Verizon can (and probably will) put the spectrum to use, so it's got that going for it. Nevertheless, it's disheartening to see cable operators, who are vital suppliers of bandwidth, throw in with another big supplier instead of finding a way to compete. If the Federal Communications Commission approves the transfer, that should drive a stake through the argument (by AT&T and others) that the wireless market is likely to become more competitive.
The deal should also persuade lawmakers to increase the amount of spectrum available for unlicensed uses. The Consumer Federation of America released a study this week estimating that Wi-Fi, Bluetooth and other unlicensed uses of spectrum are worth more than $50 billion to consumers and businesses, or far more than those airwaves could have generated from auction sales.
The Senate Commerce Committee has already approved a bipartisan bill (S 911) to shift more of the spectrum used by television broadcasters to licensed and unlicensed uses. The House Energy and Commerce Committee is considering a Republican alternative that would effectively bar unlicensed uses of this spectrum, which would be a terrible blow to innovation and competition. Here's hoping Verizon's announcement Friday persuades the House to make more airwaves available for the next innovation in unlicensed wireless uses, rather than letting the Verizons and AT&Ts of the world lock them up.
-- Jon Healey
Credit: Justin Sullivan / Getty Images