Country X is about to enter a peace agreement with a group of other countries who find it more appropriate to sell some of their weapons to Country X. Country X promises to sell to Country C a portion of the weapons once the deal with the group of countries goes through. Country X realizes that sooner or later Country C is going to turn those weapons on it, but figures since it is much bigger than Country C, it won’t be a problem.
The United Nations doesn’t like either deal. Wars have a purpose. A good war can promote some higher good like ridding the world of weapons of mass destruction, so the U.N. threatens to bring its full weight against Country X and the smaller group of nations. They must give up their treaty of cooperation and instead enter The Hunger Games and duke it out because war builds character and weeds out the weak, leaving behind a vibrant, robust ecosystem.
Country X can still sell weapons to Country C, of course, because a competition between nations is good for all nations.
That’s basically what the Federal Communications Commission and the U.S. Department of Justice did yesterday when both agencies reported that Verizon and SpectrumCo had agreed to amend their agreement where Verizon would purchase unused spectrum from SpectrumCo. The FCC and DOJ were concerned that an accompanying agreement requiring Verizon resell the cable services of SpectrumCo’s companies would not incentivize Verizon to offer and sell its own video distribution and broadband services in areas where SpectrumCo was located.
The FCC and DOJ want to see Verizon duke it out with the cable company owners of SpectrumCo. The problem I have with the settlement is that the FCC and the DOJ are forcing these companies to go up against each other. If Verizon and the cable companies believed a more effective business plan is for them to collaborate on technology research, who is the government to interject, especially where all the parties are prepared to commit? How can the FCC and DOJ argue that there will be efficiency in the broadband market by forcing parties to compete? Is it the government’s job to make markets and create artificial competition?
Verizon and the cable companies must have determined that the benefits of settlement outweighed the costs of fighting a DOJ lawsuit. Heck. After seeing AT&T forced to stand down from its proposed acquisition of spectrum licenses from T-Mobile, Verizon probably thought it wasn’t worth it. Also, T-Mobile wasn’t about to lose out on more spectrum, even if it has to get it via another DOJ shakedown.
At least the FCC can say that opponents of its decision to block AT&T-T- Mobile were wrong because T-Mobile is still standing.