Verizon CEO suggests using mobile television to get FCC approval of cable deal

If Lowell McAdam, CEO at Verizon, gets his way, his company would launch an integrated mobile television service where cable, wireless and FiOS customers could watch paid programming on mobile devices by the end of the year.

Speaking to the “Wall Street Journal,” McAdam raised the prospect of the mobile video service in an effort to persuade the FCC to approve its proposed cable provider spectrum deal. An “integrated service,” he called it, where paid TV subscribers could watch content on a device like a phone or tablet would be a companion part of the deal, where either company could sell a service from the other.

“Technically, I think we could have something out that would be the beginnings of an integrated offering in time for the holidays,” said McAdam, according to the Journal.

Verizon wants to buy spectrum for about $3.9 billion from cable operators including Comcast and Time Warner Cable. As part of the deal, the cable companies would create a joint venture and set up reseller agreements with Verizon.

A limitation of some cable TV providers' mobile viewing services is that it’s contingent on being on the same Internet connection as the main TV service. The Verizon deal would allow users to move more freely beyond the home. McAdam also suggested an “à la carte approach” where users could pick only the channels they want to watch, a first for the cable industry.

McAdam’s gesture appears to be an attempt to appease government officials concerned about the competitiveness of the deal. Officials at the Department of Justice officials are investigating the spectrum purchase for a possible collusion effect that would cripple competition in video and wireless.

Concerns have been raised that Verizon might be using a similar tactic employed by AT&T in its unsuccessful attempt to win approval for its attempted T-Mobile merger. The carrier promised rewards such as job creation and repatriation that, to regulators, not only defied the established logic of such deals.

McAdam did not mention the mobile digital television effort of broadcasters, who have not been able to do a deal with Verizon or any other major wireless carrier. Presumably, Verizon would go it alone if they create such a service.