Frontier Communications agreed to buy Verizon's residential, commercial and wholesale wireline operations in California, Florida and Texas for $10.54 billion, Frontier said Thursday. Included in the deal, which doubles Frontier's size, are 3.7 million voice connections, 2.2 million broadband connections and 1.2 million FiOS video connections, a news release said. Subject to regulatory approval, the transaction is expected to close in the first half of 2016. "These properties are a great fit for Frontier and will strengthen our presence in competitive suburban markets and accelerate our recent market share gains,” said Frontier CEO Maggie Wilderotter. The deal further strengthens Verizon’s focus on its core markets, Verizon CEO Lowell McAdam said, promising “a smooth transition” for customers and employees. Verizon also said it will lease the rights to over 11,300 of its wireless towers to American Tower Corp., which will also purchase about 165 Verizon towers for $5 billion. The telco also announced $5 billion accelerated share-repurchase program.
Those opposing USTelecom’s petition for the FCC to reconsider a declaratory ruling strengthening requirements for retiring a service are wrong in saying the change doesn't create substantive requirements for providers, the association said. Under the ruling, providers have to file for Communications Act Section 214 approval from the agency if a community believes services are being changed, not only if a listed service on a tariff is being affected (see 1501260049). That has created “impossibly vague new substantive requirements” that are “a significant burden on providers,” USTelecom said. It said in a filing posted Monday in docket 13-5 that providers “may now have to file for section 214 authority in every instance where they seek to upgrade legacy facilities, or face unpredictable and unknown consequences.”
President Barack Obama’s call to encourage municipal broadband projects (see 1501200060) seems “driven by a desire all too often found in D.C. policy circles to come up with ‘the next big idea’ rather than building upon existing programs to make them work even better,” NTCA CEO Shirley Bloomfield wrote NTIA Administrator Lawrence Strickling, said an ex parte filing posted Friday in dockets 14-115 and 14-116. Leveraging existing federal programs and incentivizing existing providers “already in the broadband business to invest and upgrade their networks should be the path of first resort,” the letter said. “This would represent a much more direct and efficient route toward better broadband than encouraging local governments that already ‘wear many other hats’ to try their hand as start-ups in a communications market that requires great focus and special expertise.”
CenturyLink requested a waiver from filing some special access data before the FCC Jan. 29 deadline. In a petition posted Friday in docket 05-25, the company asked to submit its data container and its response to Question II.A.5 of the data collection Feb. 17. The other information will be submitted by the January deadline, the carrier said. “While CenturyLink is in a position to file the entirety of its submission by the deadline, the additional time requested will enable the company to address a set of recently-discovered errors and omissions in approximately 11 million records that would significantly undermine the accuracy and usability of its submission,” CenturyLink said.
Comment is sought on the Alliance of Rural Broadband Applicants’ Jan. 27 petition for a waiver from letter of credit requirements to receive rural broadband experiment funding, the FCC Wireless Bureau said in a public notice Friday in docket 10-90. Oppositions are due Feb. 6, replies Feb. 13. The alliance represents 40 percent of the experiment’s funding and 60 percent of the census blocks to be served, said the waiver request. FCC requirements that applicants maintain a letter of credit for 100 percent of the funding over the course of the 10-year funding period are “extremely burdensome,” the alliance said. It said the 10-year period is “too long for banks.” Because banks require cash collateral equal to 100 percent of the letter of credit, the alliance said the requirement would “tie up much-needed capital” that can't be used for “network build-out, equipment, maintenance, acquisitions or other assets to enhance and expand broadband deployment.”
Opposition to forbearing from provisions of Title II reveals that the “end game" of broadband reclassification proponents is not to pass rules to ensure an open Internet, "but regulation for regulations sake,” Verizon said in a letter to the FCC, posted Tuesday in docket 14-28. The provisions from which Title II proponents are willing to forbear are “not forbearance at all, or would involve forbearance from only those provisions of little practical consequence,” the letter said. Repeating its opposition to reclassification, Verizon said even “extensive” forbearance” wouldn't solve “the intractable legal problem” that neither the Communications Act nor the Constitution allows the agency to impose common carrier obligations on broadband providers, Verizon said. Title II proponents would “inevitably" also challenge the commission’s forbearance decisions, creating “investment-chilling uncertainty over the scope of future regulation, particularly given the inevitable propensity for regulatory creep,” Verizon said. Approving reclassification at the commission’s Feb. 26 meeting, but delaying forbearance decisions, would only be a “hollow promise of potential forbearance, of uncertain scope, at some uncertain future time,” the company said. “Separate forbearance proceedings would likely take years,” Verizon said, and “would be especially dangerous for the market because the possibility of legacy Title II regulations would hang over the entire industry like Damocles’ sword suspended by a single hair.” Separately, the American Cable Association urged the commission in a letter to the agency made available to us Tuesday to exempt small- and medium-sized broadband providers from any additional transparency requirements. Smaller ISPs “do not have the incentive or ability to engage in unreasonable or discriminatory practices, much less anti-competitive acts, which harm consumers and edge providers,” ACA said in the letter, which hadn't been posted by the FCC by our deadline. Additional disclosure requirements would “not only add untenable burdens on these ISPs, but provide no corresponding benefits for consumers or edge providers,” ACA said. Edge providers “have been shown to possess sufficient tools to alert them to whether an ISP is prioritizing its own content or discriminating against unaffiliated content. These parties have not hesitated to publicize suspected violations widely on the Internet,” the letter said. Consumer Watchdog urged the commission in a letter posted Tuesday not to forbear from 14 Title II sections, particularly Section 222. That section “is perhaps the most important provision from a consumer’s perspective,” the group said. “It was explicitly put in place so that telephone companies could not exploit their copper networks to impact people’s privacy. This vital protection should exist related to private information secured from digital networks.”
There is "no good reason" for the FCC to switch local number portability administrators, but a transition “will be costly and could have dire consequences,” officials from the current LNPA, Neustar, told FCC Chief of Staff Ruth Milkman and Chairman Tom Wheeler’s wireline aide Daniel Alvarez, said an ex parte filing posted Tuesday in docket 09-109. Porting would be delayed, calls wouldn't complete, and identifying the cause of the malfunctions will be “time-consuming and leave customers with impaired service,” said Neustar CEO Lisa Hook, Len Kennedy, general counsel, and Scott Deutchman, deputy general counsel, at the Thursday meeting. "Neustar's argument is that it is too entrenched to be replaced -- even though it failed to offer a competitive bid," said Wiltshire Grannis telecom lawyer John Nakahata, who represents Telcordia. Telcordia was recommended to receive the LNPA contract. "Competitive bidding -- which Neustar once endorsed -- requires changing the incumbent when they lose. It is time for the FCC to finish the selection process and honor the results of competitive bidding, to the benefit of consumers and service providers."
Verizon agreed to a $5 million settlement with the FCC to resolve an inquiry into whether the company failed to investigate low answer rates in 26 rural areas around the country, the Enforcement Bureau said Monday. Verizon will pay a $2 million fine and commit to spend $3 million over the next three years to improve rural call completion, an agency news release said. Enforcement Bureau Chief Travis LeBlanc said, “Phone companies are on notice that the FCC will hold them accountable for failures to investigate and ensure that calls go through to the rural heartland of the country.” Verizon failed to investigate evidence of low completion rates “over a period of many months” in 2013, the release said. Verizon said in a statement that its networks are “highly reliable and successfully complete calls to all destinations -- including rural areas.” The company has been working with the agency and rural partners to analyze and test the completion of phone calls in rural areas, the company said. The consent decree puts in place a formal plan to do the analysis. The settlement "is an important reminder that rural areas like Vermont deserve equal access to quality communications services," said Senate Judiciary Committee ranking member Patrick Leahy, D-Vt., in a statement. "Vermonters rightly expect that when they pick up the phone, their calls will go through." Improving rural call completion rests on providers tracking "whether calls are completing and to investigate why calls may be failing," said NTCA CEO Shirley Bloomfield in a statement, applauding the enforcement action.
The FCC plans to fine Advanced Tel of Simi Valley, California, $1.6 million for failing to make required payments to USF and other federal telecom programs, the Enforcement Bureau said in a news release Monday. “All phone companies are required to participate in universal access programs so that consumers everywhere have access to critical telecommunications services,” Enforcement Bureau Chief Travis LeBlanc said. “Service providers who flagrantly avoid these responsibilities damage these programs and the public interest, and we demonstrate today that we will hold them accountable.” The carrier did not make payments to USF and the Telecommunications Relay Service Fund, as well as the Local Number Portability Administration, and federal regulatory fees, the release said. Advanced Tel did not immediately comment.
FCC Chairman Tom Wheeler “has made it clear” that his agenda is to increase the benchmark for broadband deployment to 25 Mbps download and 3 Mbps upload, and then use the higher standard to “justify reclassification of broadband under Title II” of the Communications Act and pre-empt state laws posing obstacles to municipal broadband, said TechFreedom President Berin Szoka in a letter to the agency, posted Friday in docket 14-28. Wheeler may also use a finding that broadband is not being deployed sufficiently under the higher standards to “justify blocking (or at least heavily conditioning)" Comcast's planned buy of Time Warner Cable, Szoka said. The FCC is expected to approve an annual report on the progress of broadband deployment, which calls for the higher standards, as well as issue a notice of inquiry on how to increase deployment at its Jan. 29 meeting (see 1501070046). Pre-emption from municipal broadband laws will be taken up at the Feb. 26 meeting (see 1501140048). Concern that the higher speeds will be used to justify other steps was also reflected in a letter from NCTA to the commission, also posted in the docket Friday. The commission “should make it clear,” as it has in previous Broadband Progress Reports, that the speed benchmark “has no regulatory significance," NCTA said. Attempting "to graft this reporting benchmark onto other contexts -- e.g., determining support levels under the Connect America Fund ... or deciding which entities should be subject to open Internet rules -- would present inevitable tensions given the divergent legal standards and regulatory objectives at play,” NCTA said. Increasing the benchmark from 4 Mbps download/1 Mbps isn't legally or factually supportable, the letter said, and there's "no basis in the record" to justify using that standard to evaluate whether broadband is being deployed in a "'reasonable and timely'" fashion. The agency didn't comment.