When: Thursday, June 5 at 10 AM ET
Where: CNBC's "Squawk on the Street"

Following is the unofficial transcript of a CNBC EXCLUSIVE interview with FCC Chairman Kevin Martin. During the interview, Martin discusses the Verizon Wireless and Alltell Corp. talks, and the XM-Sirius proposed merger, among other topics.

All reference must be sourced to CNBC.

ERIN BURNETT: JOINING US FOR AN EXCLUSIVE INTERVIEW, FCC CHAIRMAN KEVIN MARTIN. GREAT TO HAVE YOU WITH US.WE APPRECIATE IT.

KEVIN MARTIN: THANKS FOR HAVING ME.

BURNETT: GOOD TIMING FOR US.DAVID (FABER) HAS BEEN REPORTING ON IT FOR THE PAST DAY. YOU HAVE VERIZON BUYING ALLTEL. WHAT'S YOUR REACTION?

MARTIN: NOTHING HAS BEEN FILED WITH US YET. I WOULD SAY THERE'S BEEN A LOT OF ACTIVITY IN THE MARKET ON THE WIRELESS SIDE. WE JUST COMPLETED OUR AUCTION. THERE'S A LOT GOING ON AND A LOT OF ACTIVITY ON THE WIRELESS SIDE.

BURNETT: NO DOUBT THAT A LOT OF THESE BUSINESS PLANS THAT ARE BEING PUT FORTH ARE BEING PUT FORTHWITH CERTAIN ASSUMPTIONS ABOUT HOW THESE COMPANIES CAN MAKE MONEY ON PEOPLE BUYING THE INTERNET AND GETTING THE INTERNET OVER THEIR PHONE LINE OR WHATEVER IT MIGHT BE AND ALL OF THE THINGS UNDER YOUR JURISDICTION WHICH FEEDS TO THE BIG QUESTION WHICH IS DO YOU THINK AMERICANS HAVE A RIGHT TO GET THE INTERNET FOR FREE?

MARTIN: I DON'T KNOW IF THEY HAVE A RIGHT TO GET IT FOR FREE. WE'VE HAD PEOPLE TELL US THAT THEY WOULD BE WILLING TO PURCHASE SPECTRUM AND OFFER A LIFE-LINE BASIC LOWER SPEED SERVICE FOR FREE. AND I THINK THAT'S VERY IMPORTANT. WE GOT A LOT OF BROAD BAND SUBSCRIBERS IN THE UNITED STATES. LARGEST MARKET IN THE COUNTRY -- IN THE WORLD WITH OVER 70 MILLION BROAD BAND SUBSCRIBERS BUT THERE ARE PEOPLE THAT ARE UNABLE TO SUBSCRIBE TODAY OR IT'S TOO EXPENSIVE AND OFFERING A LIFE LINE BROADBAND SERVICE WOULD BE A GOOD THING.

DAVID FABER: CHAIRMAN MARTIN, IT'S DAVID FABER. RETRANSMISSION ALWAYS AN INTERESTING ISSUE. LINN TV RECENTLY A PULL FROM CHARTER. CBS AND ECOSTAR MAY GO AT YET IT. WHERE DO YOU COME DOWN? WILL THE FCC INTERVENE IF WE SEE THESE WARS BETWEEN THE CABLE COMPANIES, THE DISTRIBUTORS OF CABLE TELEVISION AND NETWORKS IN TERMS OF RETRANSMISSION?

MARTIN: BROADCASTERS HAVE ONE OF TWO OPTIONS. THEY'RE EITHER ABLE TO ASK FOR A MUST CARRY RIGHT TO BE CARRIED ON CABLE OR SATELLITE OR OFFER TO NEGOTIATE FOR COMPENSATION. IF THEY CHOOSE TO GO INTO A MARKETPLACE NEGOTIATION, THE COMMISSION STEPS BACK AS LONG AS BOTH PARTIES ARE ENGAGING IN GOOD FAITH NEGOTIATIONS, WE DON'T GET INVOLVED.

FABER: YOU DON'T SEE YOURSELF GETTING INVOLVED SHOULD PEOPLE NOT BE ABLE TO GET THEIR CBS FOR EXAMPLE ON THEIR CABLE NETWORK?

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