Don’t go there.
Frontier Communications and Verizon are trying to make the same argument that Comcast made, and lost, when it tried to restrict the California Public Utilities Commission’s review of its proposed mega-merger to some very narrow, telephone-centric considerations.
In this case, Frontier wants to buy out Verizon’s wireline systems in California. The CPUC’s office of ratepayer advocates is urging the commission to decide if that’s in the public interest, in part, on whether it’s good or bad for the broadband market here. In reply comments, Frontier says that’s out of bounds…
[California public utilities law] expressly prohibits the Commission from regulating broadband and IP-enabled services, and nothing in [federal law or the FCC’s decision to impose common carrier rules on broadband] overrides the California legislature’s explicit limitation upon this Commission…the FCC’s recent order again confirmed that broadband Internet access services are inherently interstate services for regulatory purposes. In short, the Commission does not have jurisdiction to regulate broadband or VoIP or to impose conditions related to broadband or VoIP in its consideration of this Transaction.
In the long run, there are really two questions to answer: does the CPUC think it has that authority, and do the courts agree? So far, all we know is that some commissioners, to one degree or another, think that authority exists. But so far, the commission as a whole hasn’t baked that principle into an official decision. It still might. On 25 June 2015, a formal rejection of the Comcast deal – largely on those grounds – is scheduled for consideration. The outcome won’t matter overly much to Comcast, at least not immediately, but how commissioners vote should let Frontier and Verizon know where they stand.
The filing was made in the name of both Frontier and Verizon, but I’m attributing the comments to Frontier. That’s partly due to the CPUC’s online attribution, although it might be a truncation of convenience, and partly because it’s a well reasoned and written document, completely unlike the whack-job logic and infantile whining obtuse and petulant verbiage I’ve come to associate with Verizon’s style. But read it for yourself, YMMV.