Verizon’s joint marketing pact with the cable providers may be facing some serious scrutiny, but Verizon and its partners don’t seem to have noticed. On Thursday, Time Warner Cable blithely announced they would launch bundled mobile and cable services together in five markets.
The move is the first Verizon Wireless has made with Time Warner to sell each other’s respective wireless and wire line wares, but Verizon and Comcast have already forged ahead on the west coast, working together in Portland, Ore.; Seattle and Spokane, Wash.; and San Francisco. In the Bay Area, Verizon and Comcast struck right in the heart of AT&T’s U-Verse territory, demonstrating just how powerful their tag team arrangement can be.
Time Warner and Verizon Wireless are kicking off their partnership in Cincinnati, Columbus and Toledo, Ohio; Kansas City, Kan.; and Raleigh, N.C., but plan to expand to other Time Warner markets in coming months. As in the Comcast arrangement, customers will be able to purchase a bundle of Time Warner cable TV, broadband and home phone and Verizon mobile services. They’re also sweetening the deal with a $200 prepaid debit card.
The Federal Communications Commission hasn’t yet approved the $3.6 billion spectrum sale the Verizon-cable partnerships hinge on, and the Justice Department is reportedly examining the implications of the pact on mobile and broadband completion. Congress has also gotten involved, calling Comcast and Verizon executives to task on what amounts to a cease-fire in the residential broadband market.
Verizon and the cable operators argue that their cross-selling venture and the spectrum sale are entirely unrelated, which explains why they’re moving forward with their marketing pact while the fate of their financial transaction is still in limbo. Though the FCC has authority on the license transfer, the Justice Department most likely will have to make the call on whether the partnerships amounts to collusion – and that will require an antitrust lawsuit. That leaves Verizon and the cable operators to press ahead until someone tells them they can’t.