FCC Pauses Review of Verizon’s Purchase of XO Communications

Verizon’s planned acquisition of XO seems to have hit a slow patch this summer.  The FCC yesterday hit the pause button on its 180 day review period in a letter posted here, leaving things in a bit of limbo for the moment.

Apparently, the FCC requested information from Verizon and XO in a letter on June 22 with the expectation of getting a response by July 7, but nothing has yet arrived.  What were they asking?  Well here is the letter, which runs through a laundry list of requests for details about the IP backbones of both companies, their interconnection agreements and transit pricing, the fiber overlap with Verizon’s ILEC footprint, Verizon’s plans for XO’s EoC services, whether Verizon will extend its special construction charge to work done on XO assets, and what will happen to VoIP access customers, and a bunch more.  I sure as heck would need extra time to go through all that, but then I’m not a team of Verizon’s lawyers.

Basically, the FCC is taking a hard look at the ILEC buying a CLEC, which shouldn’t surprise anyone.  And other network operators have of course raised concerns over reduced competition, as you might expect.  Dish, for example, doesn’t much like the amount of LMDS spectrum Verizon would be gaining rights to.

I rather doubt we’re at the stage that a pause means anything other than a pause.  Verizon will likely be sending along the necessary responses before long.  They did just finish with that strike and all that, which probably gummed up the works.  It’s just a bit of a different world watching the regulatory wheels churn so slowly on the ILEC side after seeing competitive providers rolling things up in a quarter.

One data point from the letter:  XO has 691 on-net buildings in Verizon territory.  There is apparently some confusion as to how many of those are served by another CLEC or cable operator, 537 or 690.

 

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Categories: CLEC · Government Regulations · ILECs, PTTs · Mergers and Acquisitions