Fierce

A new broadband battle is brewing in Missouri as the state’s largest telecommunication companies and cable operators are backing a new bill to limit municipal broadband. The new bill, SB 186, which was introduced by MO State Sen Ed Emery (R-Lamar) seeks to limit the power of municipalities to provide competition to entrenched incumbent service providers. SB 186, according to the Institute for Local Self-Reliance, imposes restrictions on local governments to provide retail and wholesale bandwidth services. “This legislation is trying to cut off communities at every turn by limiting any sort of ‘competitive service,’ whether it comes from public broadband infrastructure investment or a public-private partnership” said Christopher Mitchell of the Institute for Local Self-Reliance. “Missouri should be encouraging investment and local Internet choice, not working with monopoly lobbyists to prevent it.”

Windstream has received all of the state and federal regulatory approvals required for its acquisition of EarthLink, paving the way for the service provider to complete the deal in the first quarter. On Feb. 24, Windstream and EarthLink will each hold special meetings of their respective stockholders in connection with the merger. Windstream also announced that it will hold a conference call on March 1 to review the company's fourth-quarter and full-year 2016 earnings results. The companies first announced the all-stock deal last November. In January, the Federal Communications Commission announced it approved Windstream’s proposed acquisition of Windstream. At that time, the FCC said it did not receive any comments opposing the deal during the public comment period required by law.

It’s no secret that some of the nation’s biggest cable operators are positioning themselves to expand into the wireless market in the coming months. Comcast reportedly plunked down nearly $2 billion as a deposit to participate in the incentive auction that will wrap up in the coming weeks, and Charter Communications has applied for regulatory approval for 5G experiments. Both companies are keeping their cards close to the vest as they plot their strategies, however. Comcast CEO Brian Roberts abruptly cut off a question from analyst Craig Moffett on last month's earnings call, saying only that “We’ll clarify things” at some point in the future. Charter has not been much more vocal about its plans.

[Commentary] Municipal broadband continues to be a hotbed of debate, one that's coming to a head again in Tennessee and Virginia. Each of these states has proposed changes in the laws that govern municipal-run networks. But the question is whether their proposals are a step forward or just another way to protect incumbent telco and cable companies' hold on the broadband market.

In both of these states, incumbent telecom and cable companies like AT&T, CenturyLink and Comcast would like to retain their upper hand. Incumbents continually make two main arguments about municipal broadband: Government-run companies get an unfair advantage and other municipal provider efforts have failed. While there’s no shortage of failed municipal broadband providers like Bristol Virginia Utilities (BVU), there are a number of success stories like Danville (VA), Longmont (CO), and the emerging Roanoke Valley Authority. The new debates that have emerged in Tennessee and Virginia aren’t just about giving consumers the highest speed, but providing connectivity for day-to-day activities like doing school work.

Federal Communications Commission Chairman Ajit Pai has removed business data services (BDS) price reform from its list of active proceedings on proposed rules, marking another sign of the new Republican-dominated leadership’s light-touch regulatory mentality. “The items could be put back on circulation following modifications,” said an FCC official, adding that action is “typical” when a new presidential administration takes office. While the commissioners could revise the BDS rules, if they do they would likely be radically different than what former-FCC Chairman Wheeler proposed. FCC Commissioner Michael O’Rielly also opposed the BDS proposal.

[Commentary] As President Donald Trump settles into his new job there are a number of outstanding issues in the telecommunications industry he will likely address in the coming weeks, months and years. Below are the top seven issues that President Trump will likely weigh in on throughout his administration, as well as speculation on what he might do.

1. Select Federal Communications Commission’s leadership and determine its direction
2. (Almost certainly) repeal network neutrality
3. Act on AT&T’s proposed merger with Time Warner…
4. …and rule on future deals, like a possible Sprint and T-Mobile matchup
5. Finish the incentive auction and formulate an overall spectrum policy
6. Address "unlock the box" and the pay-TV market
7. Create more jobs in telecom

AT&T is progressing with its TDM-to-IP voice service transition in two cities in FL and AL, telling the Federal Communications Commission that on a combined basis 50 percent of total customer accounts have voluntarily migrated to one of the company's next-generation wireline and wireless voice services.

In its latest filing with the FCC, AT&T revealed that voluntary consumer transitions to IP in Carbon Hill (AL) and Delray Beach (FL) increased by 72 percent and 59 percent, respectively. As expected, consumer TDM-based services declined by 36 percent and 38 percent. AT&T reported similar trends with business customers in these two cities. Simple IP business accounts were up 35 percent in Carbon Hill and 48 percent in Delray Beach, while simple TDM business accounts declined 28 percent and 25 percent. Customers who have transitioned to the next-gen IP-based services during the trial reported they have received similar service performance, service quality and customer care to that of TDM-based services.

After touting a steady stream of synergistic benefits from its NBCUniversal division in recent quarterly earnings reports, Comcast could be facing an unanticipated challenge from being tied to the programming conglomerate. Along Donald Trump’s inexplicable march to Jan 20’s inauguration, NBCU has found itself at odds with the president-elect. In short, NBCU has a terrible relationship with an incoming president who seems to hold a grudge.

A decade ago, Trump starred in a hit reality show for NBC, The Apprentice. But last summer, the network’s top entertainment executive, Robert Greenblatt, made a private Facebook post that became public, not calling out Trump by name but presumably referring to the then far-right presidential candidate. “It’s actually corrosive and toxic because his ‘mind’ is so demented; and his effect will unfortunately linger long after he’s been told to get off the stage,” Greenblatt said.

President-elect Donald Trump may not like the idea of AT&T and Time Warner merging, but there may be little he can do to stop it, according to analysts. AT&T’s $85 billion deal for Time Warner is likely to go through, although it may come with concessions, including a possible spin-off of major Time Warner brands, Wells Fargo analyst Jennifer Fritzsche said in a research note. “While we expect there likely will be concessions (possibly a CNN spin-off, and continued infrastructure investment by T), from a legal standpoint, we note that if denied this deal would be precedent setting given the fact that no vertical merger in the TMT space has been denied,” wrote Fritzsche, adding that, while many mergers cut jobs, the small amount of overlap in core business and expertise for AT&T and Time Warner likely means no major headcount reductions.

BTIG analyst Rich Greenfield shared the view that it’s unlikely the merger could be halted. He said that it would be a “novel interpretation of the law” should the deal be blocked.

AT&T, which now owns DirecTV, urged a federal judge to reject the Justice Department’s lawsuit against its DirecTV business, arguing that the lawsuit relies on “only a handful of episodic, separate contacts” comprising nothing more than “industry chatter.” The Department of Justice’s claims are based on “nothing more than industry chatter about high-visibility topics, and cannot be sufficient to plausibly allege an ongoing reciprocal agreement to share competitively sensitive information,” AT&T said in its filing.

Specifically, AT&T said that Judge Michael Fitzgerald should shelve the antitrust charges by the Department of Justice. The company said the government’s lawsuit doesn’t “allege any traditional theory of antitrust liability” and is based on “narrow and generalized allegations of ‘information sharing.’” “Never before has a court found an antitrust violation for the mere sharing of non-price information of the type alleged here, especially when based on such threadbare allegations of an agreement,” continued AT&T in its recent filing, arguing that none of the conversations at issue in the case involved exchanging competitive price information.