Dish warns key 5G spectrum 'will be controlled almost exclusively by Verizon' if XO deal approved

Dish Network is lobbying the Federal Communications Commission to deny Verizon's proposed $1.8 billion acquisition of XO Communications' spectrum assets and fiber business, claiming among other things that the deal would have an adverse impact on competition in multiple markets. Verizon announced in February it planned to buy XO's substantial fiber-optic network, which covers 40 major US markets through 1.2 million fiber miles. The move would enable Verizon to deepen its Ethernet penetration to serve its fixed-line customers, and it may allow the carrier to cut the backhaul payments it makes to fiber providers outside its wireline markets as it densifies its cell network, partially through deploying small cells. Verizon's purchase of XO would also enable Verizon to lease XO's local multipoint distribution service (LMDS) spectrum with an option to buy it before the end of 2018. XO has 102 LMDS licenses in 28 GHz and 39 GHz bands that Verizon has said can be used to conduct 5G testing.

"The two transactions would place Verizon, one of the two largest mobile phone carriers in the nation, in control of resources -- specifically XO's fiber network and Nextlink's LMDS and 39 GHz spectrum -- that promise to play central roles in 5G applications and hence will be important to the companies competing against Verizon in the commercial mobile radio service (CMRS) 5G marketplace," Dish said in its petition. "Just as important, the transactions will eliminate current and potential competition between Verizon and XO in the mobile backhaul (both wireless and fiber), Internet transit, and enterprise and wholesale markets." Dish went on to claim that the LMDS frequencies are among the most important "next-frontier" airwaves for 5G, and licensed millimeter wave spectrum in that range "will be controlled almost exclusively by Verizon" should the acquisition go through.