Martin Alone on Revised Spectrum Screen in Sprint-Clearwire Deal
Other commissioners have rejected FCC Chairman Kevin Martin’s proposal for a revised spectrum screen as part of the order approving the Sprint Nextel-Clearwire WiMAX transaction, we've learned. An order circulated by Martin proposed adding EBS/BRS holdings to the types of spectrum the FCC includes in its screen, but the other four commissioners oppose that, FCC officials said. As a result, a revised screen likely won’t be part of a final order on the deal, set for a vote Tuesday.
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The FCC performs a detailed competitive analysis of markets where merging companies have 95 MHz or more of cellular, broadband PCS, SMR and 700 MHz spectrum. But the screen does not include the 2.5 GHz spectrum held by Sprint and Clearwire. The new Clearwire partnership would have 112.5 MHz of EBS spectrum nationwide, AT&T said a July filing, which asked the FCC to update the spectrum screen. While the order circulated by Martin approved the transaction, a revised screen could have a negative effect on future deals, commissioners feared.
The Sprint-Clearwire deal has received less attention in recent weeks than other major orders scheduled for Tuesday’s meeting, notably intercarrier compensation/universal service overhaul, the white spaces order and Verizon Wireless’s acquisition of Alltel. But like the other orders, it was the subject of meetings at the FCC before the commission cut off lobbying Tuesday night.
Top Clearwire officials met Tuesday with Martin and his top advisors about the deal, Clearwire said in an ex parte. Attending the meeting for Clearwire were Chairman Craig McCaw, CEO Ben Wolff and Gerry Salemme, executive vice president, it said. “Clearwire described the substantial benefits of the proposed transaction, including the potential New Clearwire’s alternative broadband platform to increase competition, offer consumers more choices, stimulate innovation, and enhance U.S. leadership in wireless broadband technology and deployment.”
Clearwire warned Martin that “the current status of the financial markets” could mean the companies could have trouble closing the deal if a vote is delayed, the company said in the filing. Clearwire officials also reiterated their opposition to including 2.5 GHz spectrum in a spectrum screen. Clearwire also reported on similar meetings with the four other commissioners and their legal advisors.
Meanwhile, FCC officials said Friday that commissioners have agreed to strip universal service requirements from orders on the Verizon Wireless-Alltel and Sprint-Clearwire deals. Broad intercarrier-USF overhaul appeared in doubt Friday, though discussions were continuing over the weekend. “We don’t know how it’s going to synch up with what we're going to do industry-wide on universal service,” an agency official said. “I would be shocked if there are three votes to impose universal service conditions on either of those mergers.”