Verizon and Straight Path Communications paid a $614.3 million fine to the Federal Communications Commission (FCC).
The FCC had accused Straight Path of holding 1,000 spectrum licenses but never using them. Straight Path had agreed to sell these licenses and remit 20% of the proceeds to the US Treasury. The payment of the $614.3 million penalty has resolved this investigation. The payment was termed as the largest civil penalty paid to resolve an FCC investigation.
Straight Path had already paid $15 million to the US Treasury while also surrendering about 20% of its licenses to the FCC. The current penalty is in addition to this previous payment.
These spectrum licenses are said to be essential for the emerging 5G wireless technology which will help bring in high-speed networks.
Verizon completed the acquisition of Straight Path Communications for $3.1 billion on Wednesday. Straight Path will now become a wholly-owned subsidiary of Verizon. Following the completion of the transaction, Straight Path’s shares were delisted from the NYSE.
AT&T, which had offered $1.6 billion for Straight Path, was outbid by Verizon last April.
Some of the spectrum licenses are said to be essential for the emerging 5G wireless technology
Concerns were raised against the handover of a large number of spectrum licenses to Verizon through Straight Path as it was said that this would harm the efforts of the competition to establish new technologies.
There were recommendations for the auction of these licenses stating that they could be made available to all carriers in a fair manner while also creating revenue for the government.
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