FIBER: Putting Your Gigs to Work
Sprint, T-Mobile Agree to $26 Billion Merger
The boards of Sprint and T-Mobile US struck a $26 billion merger that, if allowed by antitrust enforcers, would leave the US wireless market dominated by three national players. Under the terms of the deal, T-Mobile will exchange 9.75 Sprint shares for each T-Mobile share. T-Mobile parent Deutsche Telekom will own 42% of the combined company and Sprint parent SoftBank Group will own 27%. The remaining 31% will be held by the public. Deutsche Telekom would also control voting rights over 69% of the new company and appoint nine of its 14 directors. The combined company, which would be called T-Mobile, would be run by T-Mobile CEO John Legere. Joining the nation’s third- and fourth-largest wireless carriers would create a wireless provider with nearly 100 million cellphone customers, second only in the US to Verizon. The all-stock deal would combine Sprint, which has a market value of $26 billion, with T-Mobile, which has a market value of $55 billion. The two companies also have about $60 billion of combined net debt. The combined company would have about $74 billion in annual revenue.
“Telecom is a scale business,” said Blair Levin, a policy adviser for the analysis firm New Street Research. “There are huge advantages of scale, and T-Mobile and Sprint have been carrying the cost of a network over a much smaller number of customers.”
The companies must overcome myriad political hurdles — including consumers’ heightened skepticism about the rapid pace of consolidation in the media and telecom industries. From President Trump to Sen. Elizabeth Warren (D-MA), policymakers recently have sounded off against these deals and may train their fire soon on T-Mobile and Sprint’s latest gambit. The Federal Communications Commission and the Justice Department — which will review the newly formalized merger to ensure it protects consumers and competition — declined to comment. Some analysts say the government’s argument for opposing such a merger in 2014 since has proved correct. Preventing consolidation paved the way for T-Mobile to launch its Uncarrier campaign to reshape the wireless industry, said Craig Moffett, a telecom analyst at the research firm MoffettNathanson. The result has been lower prices and more consumer-friendly business practices, such as the end of long-term customer contracts. “The DOJ’s decision to block the transaction has been validated in every conceivable way,” Moffett said. “T-Mobile has not only survived — it has thrived. The market has become more competitive. Consumers have unambiguously benefited from the DOJ’s decision. That poses a problematic backdrop for this merger.” The companies said they hope to close the deal in the first half of 2019.
Why Is FCC Chairman Pai Dragging His Feet?
[Commentary] More than four months after the Federal Communications Commission voted to repeal its network neutrality rules, the rules adopted in 2015 are technically still on the books. And we still do not know when the repeal will take effect. The situation is “highly unusual” according to telecommunications policy expert Harold Feld. The question is, why is FCC Chairman Ajit Pai dragging his feet now when he’s so close to his goal?
Sen Markey, others caution FCC's net neutrality ruling could unduly hurt rural America
Sen Ed Markey (D-MA) continued to rail against the Federal Communications Commission's December decision to undo Obama-era net neutrality protections, arguing that the ruling could especially hurt Americans living in rural communities who face fewer choices when it comes to high-speed internet providers. Sen Markey, who is leading a Senate effort to override the FCC's controversial rollback, joined Sen Amy Klobuchar (D-MN) and other net neutrality advocates in highlighting the challenges rural Americans could face if the internet does not remain "free and open."
AT&T: Transition from Legacy DSL Largely Complete, Fiber Broadband Penetration Nearing 50% in Many Areas
AT&T now has more than five times fewer legacy DSL customers than it did four years ago. Nevertheless, the company saw a net gain of 82,000 broadband subscribers in the first quarter, an achievement that reflects a major shift in the AT&T broadband mix. "[W]e are completing our broadband transition from DSL to IP broadband,” said AT&T Senior Executive Vice President and Chief Financial Officer John Stephens. AT&T uses the term “IP broadband” to refer to services delivered over fiber-to-the-premises (FTTP) and fiber-to-the-node (FTTN) infrastructure. (The company also uses the term “high-speed broadband” to describe those services.)
Suddenly, Time Is Of Essence for Sinclair/Tribune
[Editorial] It makes sense for Sinclair to keep things rolling at the Federal Communications Commission and close on the Tribune merger before a possible adverse court ruling on the FCC's UHF discount, which could come in August or September. I think that Sinclair now understands the urgency. The regulatory and legal picture is complicated. But under all the scenarios, its chances improve the quicker it moves with the Fox deal, the FCC process and the closing.
Chairman Pai Defers Cambridge Analytica Investigation to FTC
Federal Communications Commission Chairman Ajit Pai has said the FCC does not plan to investigate reports that Dish, Tivo and ComScore may have given Cambridge Analytica "the specific viewing habits of many subscribers in the United States." Chairman Pai says the Federal Trade Commission should instead be the one investigating and added that he has forwarded the issue to the FTC. He said he was sure an inquiry would be in good hands. Chairman Pai told Rep Debbie Dingell (D-MI) that it was unclear whether Dish shared individual, personally-identifiable information or only "aggregate data which does not identify particular persons." He also said the FCC had limited authority given that neither TiVo nor ComScore were satellite companies or cable operators.
Charter to Hill: Opt For Opt-In For All
Charter is ramping up its call for online privacy legislation that applies opt-in requirements on the sharing of personal info, no matter who is doing the sharing. That came in a letter to the Hill from Charter EVP Catherine Bohigian, which followed Charter CEO Tom Rutledge's blog two weeks ago calling for an opt-in regime for all. It also follows Hill hearings with Facebook CEO Mark Zuckerberg three weeks ago and a concomitant boost in Hill sentiment for regulating edge players whose power has grown from "garage" to gargantuan.
Where in the world? Warning letters address geolocation and COPPA coverage
Under the Children’s Online Privacy Protection Rule, online services touted as ways to keep kids connected need to comply with key parental notice and consent provisions of COPPA – especially when they’re collecting children’s geolocation. That’s the message of two warning letters just sent by Federal Trade Commission staff. But the letters send another important message about the reach of COPPA. Gator Group Co., Ltd., is a company based in China that advertises a device and an app called the Kids GPS Gator Watch, marketed as a “child’s first cell phone.” Among other things, it gives a user the capability to track the child wearing the watch, enable remote voice monitoring, and set an alarm if he or she leaves a geo-fenced safe zone. Stockholm, Sweden-based Tinitell, Inc., markets a mobile phone and app “designed for kids, with calling and smart location features.” Also worn like a watch, the product lets users locate the child, call the child, add contacts, etc. But according to the letters from FTC staff, both Gator Group and Tinitell appeared to collect children’s precise geolocation, but may not have provided direct notice to parents of their information collection practices. What’s more, it doesn’t look like the companies comply with the COPPA requirement that they get verifiable parental consent before collecting, using or disclosing children’s personal information.
Facebook's deserted island
Facebook is used to being the cool kid. But now it’s eating lunch alone: Companies are trying to figure out how to be as un-Facebook-like as possible. Several tech companies, including Apple, IBM and Salesforce, have publicly differentiated themselves from Facebook. Now that lawmakers are getting more interested in regulating tech, other companies are considering launching their own campaigns to stay as far away as possible from Facebook's privacy drama.
FCC Proposes $5.3 Million Fine On Phone Company For Slamming, Cramming & Providing False Evidence
The Federal Communications Commission proposed a $5,323,322 fine against Tele Circuit Network Corporation. The Duluth (GA)-based phone company apparently switched consumers from their preferred carrier to Tele Circuit without their permission, misled consumers into believing that telemarketing calls were from the consumer’s current carrier, provided fabricated verification recordings of consumer consent to the FCC, added unauthorized charges to bills, and failed to fully respond to a Commission. The FCC alleges that Tele Circuit’s telemarketers misrepresented their identities by stating that they were calling on behalf of the consumer’s current service provider. The telemarketers also apparently discussed a fictitious government program for low-income individuals and senior citizens as a way to solicit consumer consent.
Benton (www.benton.org) provides the only free, reliable, and non-partisan daily digest that curates and distributes news related to universal broadband, while connecting communications, democracy, and public interest issues. Posted Monday through Friday, this service provides updates on important industry developments, policy issues, and other related news events. While the summaries are factually accurate, their sometimes informal tone may not always represent the tone of the original articles. Headlines are compiled by Kevin Taglang (headlines AT benton DOT org) and Robbie McBeath (rmcbeath AT benton DOT org) -- we welcome your comments.
(c)Benton Foundation 2018. Redistribution of this email publication -- both internally and externally -- is encouraged if it includes this message. For subscribe/unsubscribe info email: headlines AT benton DOT org
Benton experts make knowledge and analysis accessible to include more people in communications policymaking.
Kevin Taglang
Executive Editor, Communications-related Headlines
Benton Foundation
727 Chicago Avenue
Evanston, IL 60202
847-328-3049
headlines AT benton DOT org