Sorry Verizon, cable deal does endanger competition

Despite their constant denials, Verizon and the cable companies are diminishing competition in wireless, cable and broadband. So says the American Antitrust Institute (AAI).

In a recent white paper, AAI concludes that Verizon's proposed spectrum acquisition and cross-marketing deal “compounds the competitive harm in wireless markets, and also raises significant questions about the continued vitality of competition in wireline broadband and video markets, and of future competition between wireless and wireline services.”

According to the paper, “Where the cable companies compete against Verizon FiOS, it is easy to see how competition over the package of video, voice, high speed broadband, and wireless is diminished when both the cable company and Verizon Wireless offer the same wireless service as part of the package…”

But the authors raise a point that’s been missed by critics previously:

“Even where FiOS is not offered, Verizon Telecom offers landline voice and DSL internet services, which compete against the cable companies’ voice and broadband services... As with FiOS, Verizon will have less incentive to push its own wireline services because it profits from the sale of the cable companies’ services.”

Speed Matters and CWA have opposed the Verizon-cable deal as it is currently written, and the AAI’s research gives us no reason to change that. We urge the FCC and the Department of Justice to either stop the deal or to put meaningful conditions on it that would protect consumers and workers.

American Antitrust Institute (website)

Verizon’s deals with cable companies raise significant competitive issues (American Antitrust Institute, Apr. 2012)

Don’t Let the Verizon/Cable Deal Slam the Door on Our High Speed-Future (CWA news release, Mar. 26, 2012)