Verizon Communications’ acquisition of Rural Cellular Corp. (RCC) received conditional approval last Friday by the FCC, which is requiring the merged entity to divest overlapping wireless licenses in six markets to address competitive concerns. Announced last year, the $2.67 billion deal would enable Verizon to extend its reach in rural areas and would also boost Verizon’s subscriber base by an additional 700,000 customers. The FCC’s decision also represents the final regulatory hurdle toward completion of the transaction, which has already received conditional antitrust approval by the Justice Department (DOJ). In accordance with DOJ recommendations, the FCC is requiring Verizon to divest overlapping licenses in three Vermont markets, two Washington state markets, and in one New York market. While praising the divestures as necessary to “improve competition in the affected areas,” FCC Commissioner Michael Copps questioned the decision of his colleagues to include Verizon’s recent 700 MHz auction winnings in the agency’s wireless merger screen. Although the FCC routinely performs a competitive screen for any wireless transaction in which the post-merger entity would own more than 95 MHz of spectrum in a market, the agency decided to apply the screen used for the recent merger of AT&T and Dobson Communications that took into account spectrum won by AT&T in the recent 700 MHz auction. Noting, “the licenses won in our auction earlier this year will not even be available for use until February 2009 and it may be several years before it is ever used commercially by a majority of licensees,” Copps argued: “we have already been cavalier in applying this altered spectrum screen to prior transactions and we ought not put the cart before the horse yet again.” Along the same vein, Commissioner Jonathan Adelstein also asserted that “premature inclusion of this spectrum as part of our evaluation . . . raises concerns regarding increased likelihood of competitive harm in certain overlapping markets.”