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TheStreet Open House

Verizon Wireless Dance May Draw In Apple, Google (Update 1)

Updated to reflect calls for comment from Apple, Google and Microsoft in final paragraph.

NEW YORK ( TheStreet) -- Verizon's (VZ) $3.6 billion purchase of wireless spectrum with cable providers signals that the dance for market position may quickly draw in Apple (AAPL), Google (GOOG) and Microsoft (MSFT) .

Verizon's deal - along with moves by AT&T (T) to lock up T-Mobile and Sprint's (S) reselling marriage with Clearwire (CLWR) -- reveals that once fierce competitors are turning into partners out necessity to tie up spectrum capacity as it becomes more scarce.

On Friday Verizon bought $3.6 billion worth of wireless spectrum from Comcast (CMCSA) and Time Warner Cable (TWC) and Bright House Networks, which along with marketing partnership agreements between the competitors, sent ripples through the telecommunications and cable worlds.

That's because the deal had huge implications on how other carriers and cable companies can partner to gain competitive footing in the increasingly data heavy wireless world where not all profits have been tapped.

The deal has three major impacts:

  • Acquiring spectrum to handle smartphone data loads signals a further wireless market share push by industry leader Verizon, just as competitor AT&T struggles to add capacity through a now-antitrust blocked T-Mobile merger.
  • It limits the options for industry bantams like Sprint and a standalone T-Mobile to find growth partnerships, just as the marketing arrangements in the deal remove cable's interest in reselling programs from Clearwire and Dish (DISH).
  • Finally, the move hastens the step of industry lockups, while cash rich powerhouses like Apple, Google and Microsoft consider finding a partner for a wireless entrance before the realignment dance stops.

"Verizon just ran off with the last pretty girl in the bar," wrote Craig E. Moffett in a Friday note assessing the impact of Verizon's AWS spectrum purchase and its marketing lockup with the largest cable provider in the U.S. and powerhouse Time Warner Cable.

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