Verizon's planned sale of 24 data center sites to Equinix for $3.6 billion is part of the carrier's "three-pronged strategy for connectivity, platforms, and solutions" that could include additional mergers and acquisitions, Macquarie Capital's Amy Yong wrote investors. "Replenishing its cash keeps it on track to reach pre-Vodafone leverage and leaves dry powder for eventual M&A, which we believe could involve Dish" Network, said the analyst. Dish's 80 MHz "could bolster Verizon’s capacity, allowing it to offer unlimited data plans without straining its network," Yong emailed Tuesday evening, after the Equinix/Verizon transaction was disclosed (see 1612060036). Verizon retains 27 other data centers, including a few in Canada and the U.S. and the rest in Europe and Asia-Pacific, a telco spokeswoman said Wednesday. With Stage 3 of the FCC broadcast incentive auction ended after one round and Verizon's down payment in the auction appearing lower than rivals, if the auction is unsuccessful, Dish spectrum could be more valuable, Yong said. Dish declined to comment on the report and Verizon didn't comment. "AT&T’s push into mobile video vis-à-vis DirecTV Now/the pending Time Warner deal could push Verizon to explore more aggressive options. Sling TV could be Verizon’s 'DirecTV Now,' or a way to gain additional scale in mobile video," Yong said: "Similar to AT&T-DirecTV, Sling TV could be offered under zero-rating conditions enhancing its Freebee data offering and as a retention tool" for subscribers.

The Competitive Carriers Association, American Cable Association, NTCA and the Wireless ISP Association encouraged the FCC to extend the exemption for small broadband internet access service (BIAS) providers from the enhanced transparency requirements established by the 2015 net neutrality order, said a Wednesday CCA news release. “The FCC should grant small BIAS providers serving 250,000 subscribers or less a waiver from the enhanced transparency rules before the December 15, 2016 expiration date, to remain in effect until the small provider exemption is addressed through a notice and comment proceeding,” it said. “This important exemption expires next week,” said CCA President Steve Berry. “Even in this time of transition, the Commission needs to reach consensus and protect small providers from the prospect of facing substantial compliance burdens simply because the Commission failed to act as planned.”

FCC Commissioner Mike O’Rielly compared government-owned broadband to Cuban socialism. “Having seen the fates of Cuba and many other socialistic efforts, it seems surprising that some would want to pursue the same outcome for the U.S. communications industry,” the Republican said in an address Tuesday to the New England Ratepayers Association. Recent FCC efforts to promote municipal broadband rallied many communities to start projects, but government-owned broadband networks “are a terrible idea,” he said. “Unfortunately for their citizens, the reality has not lived up to the hype and ratepayers in communities across the country have been left holding the bag when these foolhardy experiments fail.” That’s why some states create laws restricting or limiting community networks, he said. Municipal broadband failures don’t surprise O’Rielly, he said. “Community networks have to attempt to recover high fixed costs over a small customer base, contend with shorter than expected upgrade cycles, and deal with larger than anticipated operating costs, including video program access fees. These problems are compounded when there’s another provider operating that continues to compete and hold market share.” Instead of building networks, localities should promote more private sector investment by easing rights of way, facilitating tower siting and cutting other red tape, he said. He also made some proposals for the incoming GOP-led FCC, as he did at an event in Washington Wednesday (see 1612070040).

The USF contribution factor for Q1 will drop to about 16.7 percent from Q4's 17.4 percent of carrier interstate and international telecom end-user revenue, emailed industry consultant Billy Jack Gregg on Sunday. He said the Universal Service Administrative Co. projected the industry revenue base would fall by $247 million to $13.97 billion in Q1, but USF demand was projected at just $1.98 billion. "The decline in first quarter 2017 revenues continues the downward trend in the USF contribution base, which places upward pressure on the USF assessment factor. USF revenues for the four quarters ending the first quarter of 2017 are $2.641 billion lower than revenues for the four quarters ending the first quarter 2016, a 4.4% decline," he wrote.

The FCC incentive auction's upcoming fourth stage is "critical to measure whether or not we are getting closer for the demand from bidders to eventually exceed the cost of the supply from broadcasters," Citigroup analyst Michael Rollins emailed investors Tuesday. The day before, the commission said Stage 3 ended after one round, getting about half the $40 billion-plus needed to end bidding (see 1612050062). Citigroup expects "the amount sought by broadcasters in Stage 4 to decline substantially," the analyst wrote. Carriers and others bid on 89 percent of licenses available, up from 74 percent in Stage 2, Rollins calculated. "This continues the general trend of reallocating bidding units to smaller licenses." It appears "bigger bidders withdrew the vast majority of the $1.8bn drop in demand from Stage 2 to 3," he said. As part of posted information Monday, the Public Reporting System reminded those participating in the forward auction of the prohibited communications rule: "All applicants remain subject to the prohibition regardless of developments during the auction process, regardless of whether they qualified to bid or remain eligible to bid in the forward auction."

A tech initiative at the University of Colorado plans a broadband event with FCC Chairman Tom Wheeler and FTC Chairwoman Edith Ramirez -- weeks after the presidential inauguration of Donald Trump, who will name others to run those agencies (see 1611180019 and 1611140066). CU's Silicon Flatirons program said Tuesday that Wheeler and Ramirez would be among those speaking at its Feb. 12-13 conference on broadband migration and the "First Principles of Information Policy." Ramirez is to give an "overview address" Feb. 12 at 10:30 a.m. MST, and Wheeler will give a closing keynote at noon the next day. Other participants include Comcast Senior Executive Vice President David Cohen, FTC Commissioner Terrell McSweeny, Deputy Assistant Attorney General-Litigation, Antitrust Division Jonathan Sallet, who used to be FCC general counsel, plus Mark Jamison, a member of Trump's FCC transition team. Also set to be there are some linked to Democrats, including Nielsen Executive Vice President-External Affairs Karen Kornbluh, a possible contender for FCC chairwoman if Hillary Clinton had won the presidential race (see 1611070063). Ramirez and Wheeler are confirmed to speak at the conference, and if things change, Silicon Flatirons' website will be updated, the initiative's Managing Director Anna Noschese emailed us. If Wheeler steps down as FCC member before the event, he will still take part in it, said a spokesman for that agency.

Senate Commerce Committee GOP telecom policy director David Quinalty questioned the FCC approach on cybersecurity issues Tuesday during a Media Institute event (see 1612060055). He pointed to the collaboration of such government agencies as the Department of Homeland Security but said the FCC approach seems more inclined toward mandates, whether in reporting or regarding equipment. He said he sees no directive to the agency on cybersecurity regarding any of these actions. “We would be remiss if certain agencies were to go far afield” and start “freelancing,” said Quinalty, who works for Chairman John Thune, R-S.D. Commerce Committee staffers from both chambers dubbed the cybersecurity concerns an important issue to watch next Congress. “Legislation doesn’t necessarily need to take the form of mandates,” said David Goldman, counsel to House Commerce Committee ranking member Frank Pallone, D-N.J., speculating on the possibility of providing incentives. “It’s a tough issue to legislate on,” said Kelsey Guyselman, Republican counsel for the House Commerce Committee. FCC Chairman Tom Wheeler has been backing off a controversial draft policy statement on cybersecurity that would have allowed confidential industry meetings with the agency on the subject (see 1611300063). As of Friday, that draft was on circulation, said the list last updated that day, though some expect it may be removed. One issue Hill speakers differed on was how much the next Congress might address media ownership. It “hasn’t been as hot a topic” in the Senate in recent years, Quinalty said. But Guyselman said “it’s something I anticipate we’ll continue to look at,” citing the attention from incoming House Commerce Committee Chairman Greg Walden, R-Ore., who has led the Communications Subcommittee for years. “Do the results still make sense? … It’s not like it used to be.” Pallone is “paying attention” to the state of the media since the elections, Goldman said. “He’s very concerned about the state of the press.” Pallone would be on the lookout for any changes that would diminish “dissenting voices” in the market, Goldman said.

Wireline and wireless telcos and others asked the FCC to repeal various rules as part of its latest "biennial review" of telecom regulations. USTelecom said the FCC had given "short shift" to its statutory biennial review mandate despite rapidly changing technology and markets. "This biennial should be a searching review and reevaluation of the Commission’s legacy rules to ensure that they do not interfere with the drive to build and upgrade broadband infrastructure," USTelecom said in a filing posted Tuesday in docket 16-132 on Wireline Bureau rules. The ILEC trade group also made filings in dockets 16-128 and 16-131, and others filed in docket 16-138. Also filing were CenturyLink, CTIA, Mobile Future, Verizon, Sprint, Fast DAS and United Utilities. Republican Commissioners Ajit Pai -- who many expect to be the next FCC chairman, at least on an acting basis -- and Michael O'Rielly recently said the agency should be more assertive in its regulatory review (see 1611030042).

The Trump administration should preserve the FCC Lifeline program, create multilingual emergency alert system warnings and address employment discrimination in the communications industry, according to a list of 12 "imperatives" from the Multicutural Media Telecom and Internet Council to the president-elect's transition team Friday. Other imperatives included appointing an FCC that includes diversity concerns in its rulemakings, maintaining free data programs, and banning prison phone rate overcharging. Acting on the imperatives is "vitally important" to fixing the "dismally disproportionate levels of participation among diverse groups" in the communications industry, said MMTC in a release Monday. The group also wants a '"Glide Path' for the Short-Term Survival and Long-Term Humane Decommissioning of the AM Band in a Manner that Preserves Minority Ownership."

The Communications Security, Reliability and Interoperability Council will meet Dec. 21, the FCC said in a notice in Tuesday's Federal Register. The meeting will be CSRIC's seventh under its current charter, which charges the council to work on issues such as cybersecurity and wireless alert platforms. CSRIC's charter is to expire March 18. The meeting is to begin at 1 p.m. in the Commission Meeting Room at FCC headquarters.