tinitrd ~tatcs ~rnetc WASHINGTON. DC 20510 The Honorable Eric Holder Attorney General U.S. Department of Justice 950 Pennsylvania Avenue, N.W. Washington, D.C. 20530 The Honorable Julius Genachowslci Chairman August 7, 2012 Federal Communications Commission 445 12th Street, S.W. Washington, D.C. 20554 Dear Attorney General Holder and Chairman Genachowslci, We write concerning the proposed spectrum purchase and other commercial agreements between Verizon Wireless ("Verizon") and several cable companies that are Lmder review at the Department of Justice, Antitrust Division, and the Federal Communications Commission. As members of the Senate Committees on the Judiciary and Commerce, Science and Transportation, we support robust enforcement of antitrust laws and the efficient utilization of spectrum. We urge the Department and the Commission to evaluate the transactions at issue based upon established facts and legal principles, and to regard with scrutiny speculation about the transactions and the parties that is not borne out by credible evidence. One of the transactions at issue involves the transfer of spectrum licenses from the cable companies to Verizon. The cable companies have not utilized their licenses to provide services to the public, so the transfer will put this spectrum - a scarce resource in high demand- to better use. We m·ge the Department and Commission to give strong consideration to that public benefit, in particular in light of the Administration' s stated desire to free more spectrum for use. We believe tl1e public is best served by a free market in spectrum licenses, which depends upon the government freeing spectrum for sale and permitting a robust secondary market to operate. Critics of the transaction have expressed concern about increasing concentration in spectrum license ownership. The Department and Commission should thus take care to evaluate concerns in light of established legal precedent and available evidence about the transaction and the impact it will have. TJ1ey should also take into account Verizon' s recently-announced plans to auction certain spectrw11 licenses and swap others with its wireless competitor T-Mobile, should the transaction be approved. 0966 Some have expressed concern about a proposed transaction under which Verizon and the cable companies would partner to offer consumers a "quadruple play" oflandline and wireless telephone, Internet and cable television. They speculate that this will inhibit competition in the cable market by reducing the incentive ofVcrizon's parent. Vcrizon Communications Inc., to sell or expand its FiDS service. The Department and Commission should evaluate lhe economic reality of Verizon Communication's investment in FiDS based on the evidence before Ihem. They should also consider the additional competition that will result from the potential market entry orthe cable companies as wireless providers. In writing this letter, we are mindful of the proper role of Congress and the authority vested in the Department and the Commission to review the aspects of the transactions before them. We trust that the Department and the Commission will conduct a thorough review of tile transactions based on established facts and legal principles. Sincerely. United States Senator PATTOO~ United States Senator United States Senator HM DEMINT United States Senator ff'-('::~--:;1-t.L MIKE LEE United States Senator