Kaplan Extends the Clock on Review of Verizon/Cable Transactions
The FCC Tuesday effectively suspended for 21 days the 180-day clock on its review of Verizon Wireless’s buy of AWS licenses from SpectrumCo and Cox. Opponents of the deals had asked the FCC to stop the clock because of problems they have had gaining access to documents and working their way through the massive record. Wireless Bureau Chief Rick Kaplan said in a letter posted on the FCC website he had little choice. The clock is non-binding, but still closely watched. Tuesday was officially day 103 of the commission’s 180-day review.
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"None of the Applicants completed a responsive production by March 22,” the due date for submissions at the FCC, Kaplan wrote. “Indeed, nearly two-thirds of the responsive documents the Applicants have submitted to date were submitted after April 6, and more than half of the Applicants’ total production was submitted after April 19.” Verizon Wireless responded to agency information requests with just 4,000 documents as of April 5, soaring to 50,000 documents by April 27, Kaplan wrote. “Cox and Bright House Networks did not submit the great majority of responsive documents in proper form until April 24.”
Applicants’ “untimely productions have delayed staff’s review of the proposed transactions by at least three weeks,” Kaplan wrote. “Other parties’ document reviews have been affected as well.” Kaplan said he did not “anticipate further extension of the 180-day period on account of the matters discussed” in the letter. He also acknowledged a commitment by Verizon to work with those reviewing the documents filed to make sure they can get the information they are seeking (see related story this issue).
"Verizon Wireless strongly believes it has made the case that putting unused spectrum to use to meet consumer needs is in the public interest,” Verizon said in response to the development. “This brief extension keeps the review process moving and on track, while providing additional time for parties to review the submitted documents.”
"The commission benefits most when all of the stakeholders have an opportunity to review all of the documents on the way in,” Free Press Policy Director Joel Kelsey said in an interview. “This provides a bit more opportunity for that to happen, which is a good thing.” Also important is that the FCC be “vigilant” in following up on questions that have been raised,” he said.
"We expect the Commission to take whatever time it needs for all interested parties to conduct a complete and thorough review of the voluminous documents submitted and for the Commission to consider carefully in their deliberations the arguments of the transaction opponents,” said Public Knowledge Legal Director Harold Feld in a written statement. “More than 50,000 documents have already been filed and if those raise new questions or issues, we expect the Commission staff to extend again the time for their review. At the end of the day, protecting the public interest in a transaction that could well reshape the communications industry in this country is more important than meeting an arbitrary deadline for reviewing a transaction."
The Communications Workers of America, which asked the FCC to halt the clock, hailed the announcement. “Today’s FCC decision simply shows that as federal regulators look more closely at this proposal, the more they are seeing the potential problems,” said CWA Telecommunications Policy Director Debbie Goldman. “CWA and many other national groups are saying it’s important that all the facts regarding the impact of this proposed merger -- particularly ones concerning pricing and competition -- see the light of day.”
Free State Foundation President Randolph May said he hopes the FCC will still move quickly to finalize a decision. “Without commenting specifically on this particular action, I will say that the agency in general takes too long in reviewing proposed transactions,” May said. “In today’s fast-changing marketplace, the commission needs to act with greater dispatch. So the agency needs to get the clock running again soon and keep it running."
Deal proponents still expect the FCC to complete its review within six to nine months of when it was announced, an industry executive said.
Verizon agreed in early December to pay some $3.6 billion for 122 AWS licenses from SpectrumCo (CD Dec 5 p1), a venture of Bright House Networks, Comcast and Time Warner Cable, and later that month to pay another $315 million for 30 AWS licenses from Cox Communications.