8/25 FCC Reply with Public Knowledge Opposing Verizon Purchase of Straight Path Spectrum

Regulatory/Legislative Filings
Aug. 25, 2017

The Open Technology Institute at New America filed reply comments with Public Knowledge Opposing Verizon's proposed acquisition of Straight Path Communications, arguing the Federal Communications Commission should not approve the merger because the companies have failed to show that the deal is in the public interest.  Below is a summary of the reply comments:

Introduction and Summary:

Public Knowledge and New America’s Open Technology Institute file this Reply in the above-captioned proceeding in response to the Joint Opposition to Petitions to Deny (“Joint Opposition”) submitted by Verizon Communications Inc. (“Verizon”) and Straight Path Spectrum, LLC (“Straight Path”) (collectively, “Applicants”). At present, the Federal Communications Commission (“Commission” or “FCC”) should not approve the transfer of control of wireless licenses held by Straight Path to Verizon because the Applicants have failed to demonstrate that the proposed transaction is in the public interest.

The Applicants have not met their burden of proof to demonstrate that the transaction would serve the “public interest, convenience, and necessity.” Neither the Applicants’ Public Interest Statement nor Joint Opposition provide any commitments or specific public interest benefits that would occur if the application were to be granted. The only benefit the Applicants claim is some future deployment of 5G wireless services, without specifying how this would be a public interest benefit as opposed to a profitable business venture. The Applicants are the only voice in the record in support of their position.

While the alleged public interest benefits are underwhelming, if not entirely absent, there are many public interest harms that would result from granting the transaction. The record overwhelmingly supports denial of the Verizon/Straight Path application. The proposed transaction would limit 5G competition and innovation in the millimeter wave (“mmW”) bands by allowing Verizon to exceed the mmW spectrum threshold. Further, granting the application would unjustly enrich Straight Path, undermining the FCC’s credibility with regards to future enforcement of its build-out requirements.

Extensive evidence exists in the record to support the denial of the application. To the contrary, the Applicants have not demonstrated with any detail how this acquisition would benefit the public and advance the Commission’s goals of promoting universal service and competition. Lastly, the parties do not sufficiently address the substantive concerns raised by commenters and petitioners. Therefore, the Verizon/Straight Path application should be denied.