Smaller wireless carriers should be dancing in the streets tonight after a federal appeals court rejected Verizon's arguments against the Federal Communication Commission's wireless data roaming rules.

Wireless spectrum's David vs. Goliath saga (Credit: James Martin/CNET)

Earlier today, the U.S Court of Appeals in Washington, D.C., upheld rules that the FCC had enacted a year ago that will require large wireless operators such as AT&T and Verizon Wireless to strike "commercially reasonable" roaming deals on their 4G LTE networks with any wireless operator interested in using a competitor's network to expand territory.

Verizon took issue with these rules, which are similar to rules the FCC adopted in 2007 that require voice roaming. And the carrier sued arguing the FCC did not have the authority to enact these rules since it doesn't have the authority to regulate the Internet. The court rejected this argument and told Verizon that if it doesn't like these rules, it doesn't have to build a network using the government's licenses.

While the ruling is certainly a victory for the FCC, which had its jurisdiction and authority questioned as part of the lawsuit, it's also a big victory for the hundreds of smaller wireless operators around the nation that are trying to compete against the two dominant wireless carriers in the U.S.