Verizon Wireless has agreed to make a $1.25 million “voluntary” payment to the United Stated Treasury in connection with an investigation by the Federal Communications Commission into the carrier not complying with licensing requirements associated with its 700 MHz C-Block spectrum. The requirements in question relate to the license holder providing open access to networks running across that spectrum.
The investigation was triggered by complaints from “a major application store operator block Verizon’s customers from accessing tethering applications from its online market.” According to another complaint received by the FCC, Verizon Wireless was requiring customers looking to access tethering services to sign up for such offerings, at a premium price, directly through the carrier.
In addition to the payment, Verizon Wireless agreed to notify application stores that it no longer objects to tethering applications. The carrier has already begun to move away from the practice with its recently launched Shared Data plans that now include tethering into the offering.
“Today’s action demonstrates that compliance with FCC obligations is not optional,” noted FCC Chairman Julius Genachowski, in a statement. “The open device and application obligations were core conditions when Verizon purchased the C-block spectrum. The massive innovation and investment fueled by the Internet have been driven by consumer choice in both devices and applications. The steps taken today will not only protect consumer choice, but defend certainty for innovators to continue to deliver new services and apps without fear of being blocked.”
The C-Block rules were one of the more contentious aspects of the 700 MHz auction, as Google managed to convince the FCC that open access should be a required part of that band. The FCC agreed to the stipulation if bidding for that spectrum band hit $4.6 billion, which Google made sure it did before dropping out of the auction. Verizon Wireless, which had originally opposed such stipulations, eventually won that license, which included 22 megahertz of spectrum, for $4.7 billion. The C-Block has become the bedrock of Verizon Wireless’ current LTE network build, providing the carrier with a strong coverage footprint.
Verizon Wireless also picked up 700 MHz licenses in the A- and B-Block during the auction that did not come with an open access requirement, but has recently stated it would be willing to sell off those assets should the FCC approve its current bid to acquire 1.7/2.1 GHz spectrum licenses from a variety of sources. The carrier has said that the 1.7/2.1 GHz licenses would allow it to add capacity to the LTE network in dense markets that might cause interference issues with the 700 MHz spectrum.
The interference issue has become a hot topic as reports have been released showing there are interference issues with adjacent television services, while others have countered that claim.
That has not stopped some carriers from rolling out services using A-Block spectrum, including U.S. Cellular, which many see as a prime candidate to pick up additional spectrum assets in that band should Verizon Wireless move forward with a sale. AT&T is rumored to have interest in the B-Block licenses.
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