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The Federal Communications Commission has approved the applications of Deutsche Telekom, T-Mobile USA and MetroPCS (together, the “Applicants”) to the transfer of control of a number of Personal Communications Service (“PCS”) and Advanced Wireless Services (“AWS-1”) licenses and leases, and one lower 700 MHz license to a newly combined entity, ultimately to be named T-Mobile US. Further, the Applicants sought approval to the transfer of control of international Section 214 authorizations held by T-Mobile USA and MetroPCS to Newco. Based on the record and the review of the competitive effects of the proposed transaction, the FCC finds that approval of the transaction will serve the public interest. In considering the applications, the FCC evaluated the likely competitive effects of the proposed transaction at both the local and national levels.
FCC Approves T-Mobile/MetroPCS Merger Statement (Chairman Genachowski) Statement (Commissioner Rosenworcel) Statement (Commissioner Pai) T-Mobile-MetroPCS sails through FCC without even a vote (GigaOm) Merging T-Mobile With MetroPCS Wins Approval From U.S. (Bloomberg) T-Mobile gets federal approval to buy MetroPCS (The Hill)
After a thorough review of the proposed transaction, the Antitrust Division has determined that the combination of T-Mobile and MetroPCS is unlikely to harm consumers or substantially lessen competition and has closed its investigation.
The department considered whether the proposed combination of T-Mobile and MetroPCS might tend to lessen competition substantially in any particular local area, for instance by combining the two carriers with the best local coverage. MetroPCS has a network based on high frequency spectrum (i.e. advanced wireless services (AWS) and personal communications services (PCS) spectrum) that is less able to cover rural areas or penetrate buildings. It does not provide a particularly unique and competitively significant differentiated offering in the regions in which it operates. Each of the markets served by MetroPCS is also served by all four national carriers. Accordingly, the transaction is not likely to lessen competition substantially at local levels. Finally, the proposed combination of T-Mobile and MetroPCS may have a procompetitive impact in that it improves T-Mobile’s scale and spectrum position, particularly since MetroPCS’s spectrum holdings are compatible with T-Mobile’s existing network. The department said that it will continue to monitor competition in the mobile wireless industry and to bring enforcement actions where warranted.
DoJ Approves T-Mobile/MetroPCS Merger
MetroPCS Communications wrote a letter to its shareholders correcting what it says are inaccurate and misleading statements about its proposed merger with T-Mobile USA, as shareholder opposition to the deal grows.
MetroPCS on Friday pushed back the date for its shareholders to vote on the takeover to April 12 from March 28. The letter comes after hedge fund Paulson & Co., MetroPCS's largest shareholder, recently joined fellow hedge fund P. Schoenfeld Asset Management in arguing the new company would have too much debt, preventing it from effectively competing with peers, and the interest being charged by T-Mobile-parent Deutsche Telekom is unreasonable. Furthermore, PSAM asserted, the 26% stake being offered to MetroPCS shareholders values the company at too low a multiple. In its letter, MetroPCS urged shareholders to vote for the deal, saying it was only after a multiyear process that it had decided the deal with T-Mobile was the best strategic alternative. The company said that the economic terms are "compelling," that the deal addresses MetroPCS's critical spectrum needs and competitive disadvantages, and that it will allow MetroPCS to expand into unserved and underserved major metro areas.
MetroPCS Defends T-Mobile Deal
The Federal Trade Commission released new guidance for mobile and other online advertisers that explains how to make disclosures clear and conspicuous to avoid deception.
The new guidance takes into account the expanding use of smartphones with small screens and the rise of social media marketing. It also contains mock ads that illustrate the updated principles. It emphasizes that consumer protection laws apply equally to marketers across all mediums, whether delivered on a desktop computer, a mobile device, or more traditional media such as television, radio, or print. The guidance calls on advertisers to avoid using hyperlinks for disclosures that involve product cost or certain health and safety issues. The new guidelines also call for labeling hyperlinks as specifically as possible, and they caution advertisers to consider how their hyperlinks will function on various programs and devices. The new guidance points out that advertisers using space-constrained ads, such as on some social media platforms, must still provide disclosures necessary to prevent an ad from being deceptive, and it advises marketers to avoid conveying such disclosures through pop-ups, because they are often blocked.
FTC Staff Revises Online Advertising Disclosure Guidelines .com Disclosures: How to Make Effective Disclosures in Digital Advertising (read the guidance) FTC Reboots .com Disclosures: Four Key Points and One Possible Way to Bypass the Issue Altogether (FTC blog) FTC warns advertisers to keep mobile ads clear and truthful (LATimes) FTC releases updated guidance for mobile, online advertisers (The Hill) FTC Updates Guidance for Mobile Ad Disclosures (AdWeek) Feds issue rules for social media and small screen ads — Twitter and bloggers take note (paidContent) FTC Updates Online Ad Guides for Mobile Platforms (B&C)
Level 3 Communications, resolving an investigation into the company’s rural call completion practices, has agreed to meet rigorous, verifiable call completion standards and to provide extensive records that will assist Federal Communications Commission enforcement of rules protecting against failed calls to rural areas. Level 3 will also make a $975,000 voluntary contribution to the U.S. Treasury, and has agreed to make additional $1 million voluntary contributions going forward if it misses specified quarterly benchmarks.
In its consent decree with the Enforcement Bureau, Level 3 has agreed to:
- Complete long-distance calls to incumbent local exchange carriers in rural areas at a rate within 5% of that in non-rural areas over a two-year period.
- Report compliance with the 5% benchmark every quarter, beginning in January 2014.
- Pay an additional $1 million voluntary contribution if it misses the 5% benchmark in any quarter.
- Develop scorecards for intermediate providers that Level 3 uses to route calls, assessing their performance in the areas of post-dial delay in connecting calls, network failure, and call completion rates.
- Identify problematic routes to intermediate providers monthly.
- Cease using poorly performing intermediate providers.
- Assist the Enforcement Bureau in other investigations by providing data concerning the performance of intermediate providers.
Level 3 Agrees To Adopt Rigorous New Call Completion Standards And Provide Rural Call Completion Data, Resolving FCC Investigation In the Matter of Level 3 (read the Order) In the Matter of Level 3 (read the Consent Decree) Statement (Commissioner Clyburn)
The Federal Communications Commission’s Wireline Competition Bureau seeks nominations for the following board member positions on the Board of Directors of the Universal Service Administrative Company (USAC). The terms expired on December 31, 2012.
- Representative for state telecommunications regulators (position currently held by Ronald A. Brisé).
- Representative for rural health care providers that are eligible to receive supported services pursuant to § 54.601 (position formerly held by Jay H. Sanders).
- Representative for information service providers (position currently held by David P. McClure).
- Representative for schools that are eligible to receive discounts pursuant to § 54.501 (position currently held by Sheryl R. Abshire).
All nominations must be filed with the Office of the Secretary by March 26, 2013.
FCC Seeks Nominations for Four Board Members Positions on The Universal Service Administrative Company Board of Directions
The proposed universal service contribution factor for the second quarter of 2013 will be 0.155 or 15.5 percent. Total Projected Collected Interstate and International End-User Telecommunications Revenues for Second Quarter 2013: $16.151649 billion.
Proposed Second Quarter 2013 Universal Service Contribution Factor
Relatively unsophisticated hackers could eventually disrupt insecure computer networks running parts of vital functions like the power grid, a US intelligence official said in an annual assessment of world-wide threats that gave cybersecurity top billing.
The increasing risk of cyberattacks on critical U.S. infrastructure edged aside al Qaeda and terrorism, which were described as increasingly diffuse threats more likely to harm U.S. interests abroad than at home. The annual assessment was provided by Director of National Intelligence James Clapper. Cyberattacks from "less advanced but highly motivated actors" could still do great harm, Mr. Clapper said in prepared testimony for the Senate Intelligence Committee, because of the effects on computer networks connected to the one under attack. The report cited cyberassaults last year on the websites of U.S. banks and a more destructive attack on a Saudi oil company that destroyed 30,000 computers as examples of the kinds of disruptions already taking place.
US Official Cites Cyberattack Risks Intelligence Director Warns of Cybersecurity Threats (B&C)
President Barack Obama will talk with House and Senate Republicans and Democrats in four separate meetings over the next three days and stemming gun violence and passing cybersecurity legislation will be among the topics of conversation. In a briefing with reporters, White House press secretary Jay Carney said that among his priorities will be "efforts to move forward on actions to reduce gun violence" and "the need for Congress to take action on cybersecurity."
President Will Make Personal Pitch for Cybersecurity Legislation
More government programs violated data security law standards in 2012 than in the previous year, the White House has informed Congress. At the same time, computer security costs have increased by more than $1 billion, according to the executive branch’s yearly report on compliance with the 2002 Federal Information Security Management Act.
Inadequate training was a large part of the reason all-around FISMA adherence scores slipped from 75 percent in 2011 to 74 percent in 2012. Agencies reported that about 88 percent of personnel with system access privileges received annual security awareness instruction, down from 99 percent in 2011. Meanwhile, personnel expenses accounted for the vast majority -- 90 percent -- of the $14.6 billion departments spent on information technology security in 2012. Agencies spent $1.3 billion less on IT security in 2011. Other factors that led to lower FISMA marks in 2012 the major departments are not using smartcards to restrict network access and are not automatically configuring system settings. About 57 percent of user accounts require tokens to log on, down from 66 percent in 2011. A decrease in smartcard usage at the Pentagon and significantly lower usage at the Agriculture Department contributed to the decline.
Federal Cybersecurity Misses Targets in Annual Report