AT&T Inc., the largest U.S. phone company, won approval from U.S. regulators for its $1.93 billion purchase of Qualcomm Inc. airwaves three days after the rejection of its plan to buy T-Mobile USA Inc.
The sale of frequencies covering 300 million people was cleared yesterday, the Federal Communications Commission said in an order published on its website. AT&T can’t use the airwaves in a way that interferes with other wireless carriers, the agency said.
Given the conditions imposed, the proposed deal “would not result in competitive harm that would outweigh the public interest benefits of this transaction,” the FCC said in the order. The agency said the deal would support “our goal of expanding mobile broadband deployment throughout the country.”
FCC Chairman Julius Genachowski recommended on Nov. 22 that fellow commissioners approve the airwaves sale. On the same day he moved to oppose AT&T’s proposed merger with smaller wireless competitor T-Mobile. AT&T abandoned on Dec. 19 the T-Mobile purchase designed to increase its airwaves holdings.
Qualcomm and Dallas-based AT&T didn’t immediately comment on the approval. AT&T Chief Executive Officer Randall Stephenson in a statement this week had called on policy makers to “allow the free markets to work” so more airwaves are available and called for the FCC to “expeditiously” approve the acquisition of Qualcomm airwaves.
AT&T agreed in December 2010 to the purchase of the frequencies, which Qualcomm acquired for a mobile-television service it later closed. The Justice Department ended its review of the Qualcomm sale in February, the San Diego-based chipmaker said in a Nov. 23 filing.
Buying the spectrum “is critical” to help AT&T meet burgeoning demand for wireless Internet service as consumers increasingly adopt tablet computers and smartphones, AT&T and Qualcomm said in a March 21 FCC filing. The airwaves purchase won’t harm competition, the companies said in the filing.
The transaction “would diminish competition in the already overly concentrated wireless marketplace,” the Rural Cellular Association said in a March 11 filing.
Rural phone companies asked the FCC to use the Qualcomm deal to ensure their customers can use AT&T airwaves.
Customers’ data connections may not work when they travel away from home when their phones can’t operate on airwaves assigned to dominant wireless carriers AT&T and Verizon Wireless, Steven Berry, president of the Rural Cellular Association, said in an interview before today’s approval. The Washington-based group represents carriers including U.S. Cellular Corp. and Atlantic Tele-Network Inc.
AT&T “doesn’t need this spectrum to improve its own offerings,” said Matt Wood, policy director of Florence, Massachusetts-based Free Press, a nonprofit dedicated to promoting media diversity. “AT&T can and should upgrade its own networks to provide better service to customers.”
The sales agreement with AT&T was set to expire Jan. 13, with either party able to extend it for 90 days, Qualcomm said in a Nov. 2 filing.
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