Verizon, Cable Deflect Sprint's Backhaul Fears

Verizon Wireless and its new cable partners told the Federal Communications Commission (FCC) that Sprint Corp. (NYSE: S)'s concerns about how their commercial agreements and proposed spectrum deals would affect the cellular backhaul market are much ado about nothing.

In a meeting described in this filing, execs representing Verizon Wireless, Bright House Networks , Cox Communications Inc. , Comcast Corp. (Nasdaq: CMCSA, CMCSK) and Time Warner Cable Inc. (NYSE: TWC) told the Commission that "nothing in the various commercial agreements" between the cable companies and the wireless carrier would change the MSOs' "ability and incentive to continue to compete vigorously and grow their backhaul businesses." They also stressed that the commercial agreements, which let those companies bundle and resell each other's wireless and cable services, do not contain any exclusivity provisions for Verizon Wireless related to backhaul.

Sprint outlined its backhaul-related fears last month, asking for several conditions, including one that would provide it with unrestricted access to existing cable facilities for the installation and attachment of microcells, maintaining that the devices are a vital cog for in its Network Vision strategy and its ability to serve high-demand areas. Sprint also urged the FCC to impose assurances that the cable operators also provide backhaul services on a non-discriminatory basis, fearful that the new partnerships with Verizon Wireless could cause the cable operators to jack up their backhaul rates. Why this matters
The response marks the latest step in the FCC's review process of a spectrum deal that calls for the MSOs to sell their Advanced Wireless Services (AWS) to Verizon Wireless for almost $4 billion. Sprint believes it has a lot at stake on the outcome, in part because it has already awarded some of its backhaul business to Comcast and TW Cable, and could become even more reliant on the cable companies in the weeks and years ahead. The outcome is now also important to T-Mobile US Inc. , which stands to gain some of cable's AWS spectrum, but only if Verizon Wireless can get the cable deals done. For more

— Jeff Baumgartner, Site Editor, Light Reading Cable

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