It was doubtful from the start that the Verizon-Alltel merger would be blocked by regulatory bodies. Yet, it is still significant to note that the Department of Justice has signed off on the deal. Of course, this is not without qualification. The two companies overlap in 100 markets across 22 states, and will have to divest some of those assets as a precondition to the merger. It looks like Verizon doesn’t have a problem with this, as John Thorne, general counsel for Verizon, noted that the DoJ “did it with terrific speed and thoroughness.” This represents 15 more markets than the 85 Verizon had proposed.
Consumer advocacy groups still oppose the deal, saying that Verizon is essentially buying 13 million customers and creating a lesser level of competition across the wireless space. They certainly aren’t wrong. Wireless spectrum is a finite resource, and by buying Alltel, Verizon is essentially gaining a larger slice of the pie, which is dominated by them and AT&T. The more the power is concentrated, the poorer the experience for the consumer.
The deal still has to pass through the FCC, though there’s little reason to doubt it will pass. A tentative vote is scheduled for November 4.
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