FCC Approves Verizon-Frontier Transfer of 4.8 Million Lines
The FCC approved the 4.8 million-line transfer from Frontier to Verizon. The transaction, approved Friday, will bring “broadband to millions of consumers and small businesses and anchor institutions in 14 states,” the commission said in a news release. Frontier’s voluntary commitments include offering new broadband deployment with actual speeds of at least 1 Mbps upstream and providing the FCC with data on its deployment progress “at an unprecedented level of detail,” the commission said.
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The regulator hasn’t changed the conditions in the deal since Wednesday, the last time both companies submitted letters outlining their voluntary commitments, an FCC official said. “When parties file a list of conditions they commit to, it’s unusual for them to be changed,” another official said.
On May 20, Frontier presented 29 commitments, including submitting an operations support system to the FCC and any affected state commissions if Frontier transitions from any of the support systems transferred from Verizon within three years after the closing date. The plan targets any available new broadband Universal Service Fund support to areas not served by competitors. Among Verizon’s commitments were agreeing to weekly conference calls for competitive local exchange carriers to address wholesale issues from the time the order is issued to when the deal is completed. FCC approval “will allow Verizon to accelerate its focus on wireless, broadband and global IP networks for its customers,” Senior Vice President Kathleen Grillo said. For Frontier, “the next step is to continue our testing of systems,” training new and current employees and planning, said Frontier Senior Vice President Steven Crosby.
FCC Chairman Julius Genachowski noted “the important commitments Verizon and Frontier have made to ensure a smooth transition of their operations support systems,” he said. “No transaction is without risk and this one has its fair share.” Based on the FCC’s review, “we conclude that on balance the likely public-interest benefits outweigh the potential public-interest harms.” By our deadline, the order approving the deal hadn’t been released by the FCC.
There’s some concern from competitors who harkened back to similar transactions between Verizon and FairPoint and a telco in Hawaii. The acquiring companies “failed to maintain adequate wholesale operations support system functionalities,” said lawyer Thomas Jones of Willkie Farr, representing Integra, tw telecom and other CLECs. “We wish that the FCC had adopted more robust conditions to address this risk, including for example a requirement that a third party review the sufficiency of the Frontier wholesale OSS post-transaction.”