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The FCC Four: The Top Special Interests Lobbying the FCC

March was a big month for lobbyists visiting the Federal Communications Commission, which opened the doors to wireless special interest groups for “ex parte” meetings with agency staffers that, in turn, brief the three Republicans and two Democrats that serve as FCC commissioners.

Last month’s ex parte filings reveal strong evidence of a coordinated, well-financed campaign by America’s wireless operators and cable companies to get the FCC to ease off regulations governing forthcoming 5G networks, particularly with respect to where tens of thousands of “small cell” antennas will be installed to deliver the service.

Four industry trade groups and companies are part of the concerted campaign to scale back third party control over where 5G infrastructure will end up. Some want to strip local governments of their power to oversee where 5G infrastructure will be placed, while others seek the elimination of laws and regulations that give everyone from historical societies to Native American tribes a say where next generation wireless infrastructure will go. The one point all four interests agree on — favoring pro-industry policies that give wireless companies the power to flood local communities with wireless infrastructure applications that come with automatic approval unless denied for “good cause” within a short window of time, regardless of how overwhelmed local governments are by the blizzard of paperwork.

Here are the big players:

The Competitive Carriers Association (CCA)

The CCA is primarily comprised of rural, independent, and smaller wireless companies. In short, a large percentage of wireless companies not named AT&T or Verizon Wireless are members of CCA. The CCA’s chief goal is to protect the interests of their members, who lack the finances and political pull of the top two wireless companies in the U.S. CCA lobbyists met ex parte with the FCC multiple times, submitting seven filings about their March meetings.

CCA’s top priority is to get rid of what they consider burdensome regulations about where members can place cell towers and antennas. They also want a big reduction in costly environmental, tribal, and historic reviews that are often required as part of a wireless buildout application. CCA lobbyists argue that multiple interests have their hands on CCA member applications, and fees can become “exorbitant” even before some basic reviews are completed. The CCA claims there have been standoffs between competing interests creating delays and confusion.

Costs are a relevant factor for most CCA members, which operate regional or local wireless networks often in rural areas. Getting a return on capital investment in rural wireless infrastructure can be challenging, and CCA claims unnecessary costs are curtailing additional rural expansion.

NCTA – The Internet & Television Association

The large cable industry lobbyist managed to submit eight ex parte filings with the FCC in March alone, making the NCTA one of the most prolific frequent visitors to the FCC’s headquarters in Washington.

The NCTA was there to discuss the Citizens Broadband Radio Service (CBRS) band, which is of particular interest to cable companies like Charter Communications, which wants to get into the wireless business on its own terms. Cable lobbyists, under the pretext of trying to avoid harmful interference, want to secure a large percentage of the CBRS band for their licensed use, at the expense of unlicensed consumers and their wireless industry competitors.

The cable industry wants CBRS spectrum to be wide, spacious, and contiguous for its cable industry members, which should open the door to faster speeds. The lobbyists want to make life difficult for unlicensed use of the band, potentially requiring cumbersome use regulations or costly equipment to verify a lack of interference to licensed users. They also want their traffic protected from other licensed users’ interference.

CTIA – The Wireless Association

The wireless industry’s largest lobbying group made multiple visits to the FCC in March and filed 10 ex parte communications looking for a dramatic reduction in local zoning and placement laws for the next generation of small cells and 5G networks.

The CTIA has been arguing with tribal interests recently. Tribes want the right to review cell tower placement and the environmental impacts of new equipment and construction. The CTIA wants a sped-up process for reviewing cell tower and site applications with a strict 30-day time limit, preferably with automatic approval for any unconsidered applications after the clock runs out. Although not explicitly stated, there have been grumblings in the past that tribal interests are inserting themselves into the review process in hopes of collecting application and review fees as a new revenue source. Wireless companies frequently question whether tribal review is even appropriate for some applications.

Sprint has had frequent run-ins with tribal interests demanding several thousand dollars for each application’s review under the National Historic Preservation Act (NHPA), which is supposed to protect heritage and historical sites.

In Houston, Sprint deployed small cells around the NRG Stadium, but found itself paying fees to at least a dozen Indian Tribal Nations as part of the NHPA. The NHPA opens the door to a lot of Native Americans interests because of how the law is written. Any Tribal Nation can express an interest in a project, even when it is to be placed on public or private property that is not considered to be tribal land. In Houston, Sprint found itself paying $6,850 per small cell site, not including processing fees, which raised the cost to $7,535 per antenna location. Those fees only covered tribal reviews, not the cost of installation or equipment. Some tribes offered better deals than others. The Tonkawa Tribe has 611 remaining members, mostly in Oklahoma. But they sought and got $200 in review fees for the 23 small cell sites deployed around the stadium. The Kiowa Indian Tribe of Oklahoma, not Texas, charged $1,500 for the 23 applications it reviewed.

Sprint complains it has paid millions in such fees over the last 13 years and no tribe to date has ever asked to meet with Sprint or suggest one of its towers or cell sites would intrude on historic or tribal property.

“Tribal Nations are continuing to demand higher fees and designate larger and larger areas of interest,” says Sprint. “At present, there are no constraints on the amount of fees a Tribal Nation may require or the geographic areas for which it can require payment for review. The tribal historic review process remains in place even in situations—such as utility rights-of-way—where the Commission has exempted state historic review.”

The CTIA wants major changes to the NHPA and other regulations regarding cell tower and antenna placement before the stampede of 5G construction begins.

Verizon

Verizon has been extremely busy visiting with the FCC during the month of March, filing 10 ex parte communications, also complaining about the tribal reviews of wireless infrastructure.

Verizon argues it wants to expand wireless service, not effectively subsidize Native American tribes.

“The draft order’s provisions to streamline tribal reviews for larger wireless broadband facilities will likewise speed broadband deployment and eliminate costs, thus freeing up resources that can, in turn, be used to deploy more facilities,” Verizon argued in one filing.

Verizon has also been carefully protecting its most recent very high frequency spectrum buyouts. It wants the FCC to force existing satellite services to share the 29.1-29.25 GHz band for 5G wireless internet. Verizon has a huge 150 MHz swath of spectrum in this band, allowing for potentially extremely high-speed wireless service, even in somewhat marginal reception areas.

“Verizon assured the commission that even when sharing with other services, we would be able to make use of the 150 MHz of spectrum in this block to provide high-speed broadband service to American consumers,” said one filing.

Residents Rebel Against Verizon’s “Godzilla” Small Cell Poles, Previewing 5G Battles to Come

Judith Monroy looks up at a recently installed Verizon small cell signal booster (upper right) placed a few dozen feet from her front door. It was accompanied by a 5-foot high utility cabinet (lower left) containing backup batteries to power Verizon’s equipment for up to four hours in the event of a blackout. (Image courtesy: The Press Democrat)

A preview of the possible aesthetics battle of future 5G small cells that are expected to proliferate across America’s cities and towns in the coming years is taking place in Santa Rosa, Calif., where residents and some city officials reacted with surprise when Verizon began attaching “small cell” wireless repeater equipment on 72 city-owned light and utility-owned poles around the city. While not exactly the same at the 5G equipment Verizon is preparing to install in Sacramento to launch its forthcoming fixed wireless service, the similar-sized equipment turned out to look nothing like what was promised by Verizon officials. But city officials learned this only after the project was approved by a 7-0 City Council vote in 2017.

In January, one resident learned about the sudden arrival of Verizon Wireless’ equipment when she opened her front door one morning to confront a utility pole decorated with antenna equipment and a 5-foot high utility box about 30 feet away from her home.

“I’m planning to put this house on the market and the mechanisms on the telephone pole and in the ground are very aggressive and ominous-looking,” said Judith Monroy, 75. “You can’t miss them.”

Within days, someone vandalized the utility box, spray painting the word “no” and “stop this” for all to see.

In many areas, 5G small cells will be installed on utility or light poles in the front yards of residential homes. Wireless companies will want to place equipment on poles that are not obstructed by foliage or tall, nearby infrastructure, which can block signals. Requests for aggressive tree trimming to remove obstacles, within the limits permitted by local ordinances and the policies of the pole owner, are also likely. This is certain to create controversy if property owners find their trees or shrubbery removed or aggressively pruned. But for many others, the appearance of the new equipment is enough to provoke protests.

When some property owners discovered Verizon was also adorning electric utility poles with its cellular equipment, some started referring to them as “PG&E’s Godzilla Poles.”

‘PG&E Pole Godzilla’ (Image courtesy: The Press Democrat)

The utility poles hosting Verizon’s equipment have new “branches” attached several feet below pre-existing utility wiring, onto which small cell antennas are attached.

As more equipment gets installed, the more concerned citizens are phoning up city hall to complain.

Last week, city officials bowed to citizen pressure and temporarily suspended Verizon Wireless’ antenna upgrade program. While some residents cited health and safety fears from electromagnetic radiation — a fear repeatedly debunked — many more were upset by the aesthetics of the equipment and wondered if the city got a raw deal.

“I think it is time to push the pause button on this installation in our neighborhoods,” said John Cushman, a resident of Hidden Valley. “This project has been rushed and the only urgency I can see is financial.”

Verizon is paying the city $350 per pole, an amount some local residents consider absurdly low. As opposition mounted, some uncomfortable members of City Council that originally voted in favor of Verizon’s plan changed their minds, according to The Press Democrat:

Neighbors are not happy about Verizon’s new equipment. (Image courtesy: The Press Democrat)

“I am supportive of putting the brakes on this,” Councilman Tom Schwedhelm said. “I’m not convinced that we’ve done everything that we can so we can look anyone in the face and say ‘Yes it’s safe there. It’s safe to be in front of my house.’ ”

Councilman Jack Tibbetts said he viewed the rollout as a “commercial enterprise” that perhaps was better suited to commercial areas given the city’s stated goal of helping strengthen the city’s wireless infrastructure to foster entrepreneurialism.

“I’d like to see residential zones be carved out in our ordinance,” Tibbetts said to loud applause in a chamber full of people wearing bright yellow stickers reading “Caution: Cell tower microwave frequency hazard.”

But Verizon may have positioned itself to move forward regardless of what the city has in mind.

The company announced it would continue installation at 25 previously approved sites where it already has permits in-hand. Verizon has yet to obtain permits to place equipment at two other PG&E sites and 31 city light poles.

The city will not have much say over pole attachments on PG&E’s infrastructure, which is governed on the state level by the California Public Utilities Commission.

If the city denies Verizon’s request to install its equipment on city-owned light poles, the company could just move those antennas to other PG&E poles nearby instead.

Verizon Begins Wave of Call Center Closures, Layoffs, in Transition to “Home Based Agents”

Phillip Dampier February 26, 2018 Consumer News, Verizon, Wireless Broadband 3 Comments

Verizon has announced a wave of call center closures in several states that will results in layoffs, although some employees will be invited to reapply for their position if they are willing to move to another state or continue their work as a “Home Based Agent” taking customer service calls from a home office.

Verizon is cutting back on customer service call centers, after looking for ways to cut expenses and direct customers to use “self-service” options on Verizon’s website. For those who still want to speak to ‘a real person,’ increased hold times may be the result. Verizon maintains 16 call centers around the country, with at least six scheduled to close and a seventh closure already in progress.

Affected customer service call centers:

  • Mankato, Minn. — Originally a call center for Midwest Wireless and Alltel before being acquired by Verizon Wireless, about half of the estimated 600 workers will be invited to continue as Home Based Agents, while others will be laid off or invited to apply for another position if they are within 90 miles of another Verizon call center and are willing to commute or relocate. Just a few years ago, this call center was desperate to hire new workers, handing out lucrative signing bonuses and other incentives. The center is expected to close by this September.
  • North Charleston, S.C. — Formerly a Montgomery Ward department store, Verizon Wireless repurposed the 150,000 square foot facility and hired up to 1,000 workers when it opened in 2004. About 500 workers are being invited to transition into Home Based Agents, “supporting customers the same way and with similar tools as if they were working from a traditional brick-and-mortar call center,” according to a Verizon spokesperson. Verizon will save almost $2 million a year in rent closing the call center. The layoffs and call center shutdown are expected to be complete by September.
  • Huntsville, Ala. — The call center in Research Park will be shuttered “in the coming months,” with workers invited to participate in the Home Based Agents program. Verizon claims it will cover “most” of the equipment and supplies needed to work from home, and will pay a stipend of $65 a month for internet access. But other ongoing home office-related expenses, including electricity, furniture, insurance, and other related costs will the employee’s responsibility.
  • Albuquerque, N.M. — Verizon Wireless will shut down its 197,000 square foot call center by October 2019, with workers selected for its Home Based Agents program transitioned out of the building by May of 2019. At least 1,000 workers are likely affected. The call center cost $30 million to open in 2006 and by 2009 employed 1,600 workers.
  • Hilliard, Ohio — A Verizon call center that formerly absorbed a lot of displaced Verizon call center employees across the region is itself shutting down by November of this year. Qualified workers are invited to continue as Home Based Agents. Verizon employees complain Home Based Agents lack job security and are usually among the first to be laid off in any future downsizing actions. Some recommend relocating to another call center instead of working from home.
  • Little Rock, Ark. — Verizon has informed its 600 Little Rock call center employees they are shutting down the office by this October, and workers that want to stay with Verizon will be able to transition to a work-at-home model or apply for a job elsewhere in the company.
  • Franklin, Tenn. — Already downsizing, this call center will be shuttered sometime this year, with workers invited to apply for the Home Based Agents program. But some workers with experience working from home warn there are significant downsides: “You can’t relocate to another call center or move to the Home Based Agents program if you are on ‘corrective action’ (for attendance or performance),” said one worker. Those employees will lose their jobs and receive severance packages. “Moral of the story, don’t let yourself get an attendance warning for your kids having the flu [thinking] ‘I will [accept a write-up]’ because if your center closes, you cannot relocate.”

Verizon spokesperson Jenny Weaver told the Albuquerque Journal a very different story about home agents.

“At other places, we’ve found it’s a satisfaction driver for employees,” Weaver said. “Happy employees translates to happy customers, so we’re excited about this.”

Verizon Thumbs Its Nose at FCC: Will Lock Smartphones Despite Agreement Prohibiting It

Verizon Wireless, ignoring its agreement with the Federal Communications Commission not to lock handsets, will soon stop selling unlocked phones, at least temporarily preventing customers from taking their phones to another carrier or overseas without Verizon’s consent.

Verizon’s ‘SIM Lockdown’ is expected to begin later this year in a move Verizon is calling a “theft control measure.”

Verizon Wireless is the only major carrier that does not lock its smartphones, but that policy was agreed to as a condition of its acquisition of 700 MHz spectrum licenses in 2008, which included a prohibition on phone locking. But Verizon seems to think its new locking policy doesn’t break any rules or that nobody will care.

“We’re taking steps to combat this theft and reduce fraud. These steps will make our phones exponentially less desirable to criminals,” Tami Erwin, executive vice president of wireless operations for Verizon, said in a statement to CNET.

After the change takes effect, Verizon Wireless customers will find their new handsets locked and unable to be used with other carriers until activated on a new or existing Verizon Wireless account. After that, Verizon says it will still keep the phone locked for an unspecified waiting period to prevent cell phone thieves from stealing a phone, activating it with a stolen identity, and then selling it for profit. Verizon won’t say exactly when customers will be able to get their devices unlocked.

With an industry friendly Republican majority on the Federal Communications Commission, Verizon may be attempting to test the waters to see if it can successfully walk away from its agreement with the FCC without penalty or even win itself a waiver. But FCC rules don’t appear to give Verizon the leeway it needs to unilaterally act:

§ 27.16 Network access requirements for Block C in the 746-757 and 776-787 MHz bands.

(a)Applicability. This section shall apply only to the authorizations for Block C in the 746-757 and 776-787 MHz bands assigned and only if the results of the first auction in which licenses for such authorizations are offered satisfied the applicable reserve price.

(b)Use of devices and applications. Licensees offering service on spectrum subject to this section shall not deny, limit, or restrict the ability of their customers to use the devices and applications of their choice on the licensee’s C Block network, except:

(1) Insofar as such use would not be compliant with published technical standards reasonably necessary for the management or protection of the licensee’s network, or

(2) As required to comply with statute or applicable government regulation.

(c)Technical standards. For purposes of paragraph (b)(1) of this section:

(1) Standards shall include technical requirements reasonably necessary for third parties to access a licensee’s network via devices or applications without causing objectionable interference to other spectrum users or jeopardizing network security. The potential for excessive bandwidth demand alone shall not constitute grounds for denying, limiting or restricting access to the network.

(2) To the extent a licensee relies on standards established by an independent standards-setting body which is open to participation by representatives of service providers, equipment manufacturers, application developers, consumer organizations, and other interested parties, the standards will carry a presumption of reasonableness.

(3) A licensee shall publish its technical standards, which shall be non-proprietary, no later than the time at which it makes such standards available to any preferred vendors, so that the standards are readily available to customers, equipment manufacturers, application developers, and other parties interested in using or developing products for use on a licensee’s networks.

(d)Access requests.

(1) Licensees shall establish and publish clear and reasonable procedures for parties to seek approval to use devices or applications on the licensees’ networks. A licensee must also provide to potential customers notice of the customers’ rights to request the attachment of a device or application to the licensee’s network, and notice of the licensee’s process for customers to make such requests, including the relevant network criteria.

(2) If a licensee determines that a request for access would violate its technical standards or regulatory requirements, the licensee shall expeditiously provide a written response to the requester specifying the basis for denying access and providing an opportunity for the requester to modify its request to satisfy the licensee’s concerns.

(e)Handset locking prohibited. No licensee may disable features on handsets it provides to customers, to the extent such features are compliant with the licensee’s standards pursuant to paragraph (b)of this section, nor configure handsets it provides to prohibit use of such handsets on other providers’ networks.

(f)Burden of proof. Once a complainant sets forth a prima facie case that the C Block licensee has refused to attach a device or application in violation of the requirements adopted in this section, the licensee shall have the burden of proof to demonstrate that it has adopted reasonable network standards and reasonably applied those standards in the complainant’s case. Where the licensee bases its network restrictions on industry-wide consensus standards, such restrictions would be presumed reasonable.

Verizon’s old unlocking policy.

Verizon does not need to lock phones to control stolen device trafficking. An earlier initiative by the wireless industry tracks stolen phone IMEI and other identification numbers that are needed to activate service. If a carrier gets a request to activate service on a phone or device with a suspect IMEI number, the carrier can refuse service, rendering the phone useless on the stolen goods market. But Verizon may have other motives in mind.

“This is going to make it harder for rivals to poach subscribers from Verizon,” Avi Greengart, an analyst at Global Data, told CNET, because customers bringing their Verizon smartphones to other carriers may find they cannot use them on the competitor’s network. The phones also won’t work if a customer travels abroad and uses a SIM card purchased in the destination country, which could offer substantially lower rates than Verizon’s international calling and data plans or roaming.

Few consumers would be willing to buy new phones for $600+ just to switch carriers, a fact Verizon is likely well aware will keep customers loyal to them.

The Great Telecom Merger Carousel: Altice <-> Sprint <-> T-Mobile <-> Charter

A last-ditch effort last weekend by executives of SoftBank and Deutsche Telekom to overcome their differences in merging Sprint with T-Mobile USA ended in failure, killing Wall Street’s hopes combining the two scrappiest wireless carriers would end a bruising price war that had heated up competition and hurt profits at all four of America’s leading wireless companies.

Now Wall Street, hungry for a consolidation deal, is strategizing what will come next.

Sprint/T-Mobile Merger

In the end, SoftBank’s chairman, Masayoshi Son, simply did not want to give up control of Sprint to Deutsche Telekom, especially considering Sprint’s vast wireless spectrum holdings suitable for future 5G wireless services.

The failure caused Sprint Corp. shares and bonds to plummet, and spooked investors are worried Sprint’s decade-long inability to earn a profit won’t end anytime soon. Sprint’s 2010 Network Vision Plan, which promised better coverage and network performance, also helped to load the company with debt, nearly half of which Sprint has to pay back over the next four years before it becomes due. Sprint’s perpetual upgrades have not tremendously improved its network coverage or performance, and its poor performance ratings have caused many customers to look elsewhere for wireless service.

Investors are also concerned Sprint will struggle to pay its current debts at the same time it faces new ones from investments in next generation 5G wireless technology. Scared shareholders have been comforted this morning by both Son and Sprint CEO Marcelo Claure in an all-out damage control campaign.

Son has promised the now-orphaned Sprint will benefit from an increased stake in the company by SoftBank — a signal to investors SoftBank is tying itself closer to Sprint. Son has also promised additional investments to launch yet another wave of network upgrades for Sprint’s fourth place network. But nothing is expected to change very quickly for customers, who may be in for a rough ride for the immediate future. Son has already said his commitment to raise Sprint’s capital expenditures from the current $3.5-4 billion to $5-6 billion annually will not begin this year. Analysts claim Sprint needs at least $5-6 billion annually to invest in network improvements if it ever hopes to catch up to T-Mobile, AT&T, and Verizon Wireless.

Masayoshi Son, chairman of SoftBank Group

“Even if the next three-four years will be a tough battle, five to 10 years later it will be clear that this is a strategically invaluable business,’’ Son said, lamenting losing control of that business in a deal with T-Mobile was simply impossible. “There was just a line we couldn’t cross, and that’s how we arrived at the conclusion.”

During a call with analysts on Monday, Sprint’s chief financial officer Tarek Robbiati acknowledged investors’ disappointment.

Investors were hoping for an end to deep discounting and perks given to attract new business. T-Mobile’s giveaways and discounting have reduced the company’s profitability. Sprint’s latest promotions, including giving away service for up to a year, were seen by analysts as desperate.

Son’s own vision plan doesn’t dwell on the short-term, mapping out SoftBank’s progress over the next 300 years. But for now, Son is concerned with supporting the investments already made in the $100 billion Vision Fund Son has built with Saudi Arabia’s oil wealth-fueled Public Investment Fund. Its goal is to lead in the field of next generation wireless communications networks. Sprint is expected to be a springboard for those investments in the United States, supported by the wireless company’s huge 2.5GHz spectrum holdings, which may be perfect for 5G wireless networks.

But Son’s own failures are also responsible for Sprint’s current plight. Son attempted to cover his losses in Sprint by pursuing a merger with T-Mobile in 2014, but the merger fell apart when it became clear the Obama Administration’s regulators were unlikely to approve the deal. After that deal fell apart, Son has allowed T-Mobile to overtake Sprint’s third place position in the wireless market. While T-Mobile grew from 53 million customers to 70.7 million today, Sprint lost one million customers, dropping to fourth place with around 54 million current customers.

Son’s answer to the new competition was to change top management. Incoming Sprint CEO Marcelo Claure promptly launched a massive cost-cutting program and layoffs, and upgrade-oriented investments in Sprint’s network stagnated, causing speeds and performance to decline.

Claure tweetstormed damage control messages about the merger’s collapse, switching from promoting the merger’s benefits to claims of relief the merger collapsed:

  • “Jointly stopping merger talks was right move.”
  • Sprint is a vital part of a larger SoftBank strategy involving the Vision Fund, Arm, OneWeb and other strategic investments.”
  • “Excited about Sprint’s future as a standalone. I’m confident this is right decision for our shareholders, customers & employees.”
  • “Sprint added over 1 million customers last year – we have gone from losing to winning.”
  • “Last quarter we delivered an estimated 22% of industry postpaid phone gross additions, our highest share ever.”
  • “Sprint network performance is at best ever levels – 33% improvement in nationwide data speeds year over year.”
  • “We are planning significant investments to the Sprint network this year and the years to come.”
  • “In the last 3 years we’ve reduced our costs by over $5 billion.”
  • “Sprint’s results are the best we’ve achieved in a decade and we will continue getting better every day.”

In Saturday’s joint announcement, Claure said that “while we couldn’t reach an agreement to combine our companies, we certainly recognize the benefits of scale through a potential combination. However, we have agreed that it is best to move forward on our own. We know we have significant assets, including our rich spectrum holdings, and are accelerating significant investments in our network to ensure our continued growth.”

“They need to spend (more) money on the network,” said William Ho, an analyst at 556 Ventures LLC.

CNBC reports Sprint’s end of its T-Mobile merger deal has hammered the company’s stock. What does Sprint do now? (1:30)

Sprint/Altice Partnership

Sprint executives hurried out word on ‘Damage Control’ Monday that Altice USA would partner with Sprint to resell wireless service under the Altice brand. In return for the partnership, Sprint will be able to use Altice’s fiber network in Cablevision’s service area in New York, New Jersey, and Connecticut for its cell towers and future 5G small cells. The deal closely aligns to Comcast and Charter’s deal with Verizon allowing those cable operators to create their own cellular brands powered by Verizon Wireless’ network.

An analyst at Cowen & Co., suspected the Altice deal may be a trial to test the waters with Sprint before Altice commits to a future merger between the two companies. Altice is hungry for expansion, currently owning Cablevision and Suddenlink cable operators in the U.S. But Altice has a very small footprint in the U.S., leading some analysts to believe a more lucrative merger might be possible elsewhere.

Sprint/Charter Merger

Charter Communications Logo. (PRNewsFoto/Charter Communications, Inc.)

Charter Communications stock was up more than 7% in early Monday morning trading as a result of speculation SoftBank and Charter Communications were restarting merger talks after a deal with T-Mobile collapsed.

CNBC reported that Mr. Son was willing to resume talks with Charter executives about a merger between the cable operator and Sprint. Charter executives have shown little interest in the deal, still distracted trying to merge their acquisitions Time Warner Cable and Bright House Networks into Charter’s current operation. Charter’s entry into wireless has been more tentative, following Comcast with a partnership with Verizon Wireless to resell that considerably stronger network under the Charter brand beginning sometime in 2018.

According to CNBC, John Malone’s Liberty Media, which owns a 27% stake in Charter, is now in favor of a deal, while Charter’s top executives are still opposed.

CNBC reports Charter and Sprint may soon be talking again about a merger between the two. (6:33)

Dish Networks <-> T-Mobile USA

Wall Street’s merger-focused analysts are hungry for a deal now that the Sprint/T-Mobile merger has collapsed. Pivotal Research Group is predicting good things are possible for shareholders of Dish Network, and upgraded the stock to a “buy” recommendation this morning.

Jeff Wlodarczak, Pivotal’s CEO and senior media analyst, theorizes that Sprint’s merger collapse could be good news for Dish, sitting on a large amount of unused wireless spectrum suitable for 5G wireless networks. Those licenses, estimated to be worth $10 billion, are likely to rise in value as wireless companies look for suitable spectrum to deploy next generation 5G networks.

Multichannel News quotes Wlodarczak’s note to investors:

“In our opinion, post the T-Mobile-Sprint deal failure there is a reasonable chance that T-Mobile could make a play for Dish or Dish spectrum as it would immediately vault the most disruptive U.S. wireless player into the leading U.S. spectrum position (w/ substantially more spectrum than underpins Verizon’s “best in class” network),” Wlodarczak wrote. “This possible move could force Verizon to counter-bid for Dish spectrum (or possibly the entire company) as Dish spectrum is ideally suited for Verizon and to keep it out of T-Mobile’s hands.”

AT&T/DirecTV Buyout of Dish Network

Wlodarczak has also advised clients he believes the deregulation-friendly Trump Administration would not block the creation of a satellite TV monopoly, meaning AT&T should consider pairing its DirecTV service with an acquisition of Dish Networks’ satellite TV business, even if it forgoes Dish’s valuable wireless spectrum.

“AT&T, post their Time Warner deal, could (and frankly should) be interested in purchasing Dish’s core DBS business taking advantage of a potentially more laissez faire regulatory climate/emergence of V-MVPD’s, to significantly bolster their DirecTV business (and help to justify the original questionable DirecTV deal) by creating a SatTV monopoly in ~10-15M US households, increased programming scale and massive synergies at a likely very attractive price.”

Such a transaction would likely resemble the regulatory approval granted to merge XM Satellite Radio and Sirius Satellite Radio into SiriusXM Satellite Radio in 2008. Despite the merger, just months after its approval, the combined company neared bankruptcy until it was bailed out with a $530 million loan from John Malone’s Liberty Media in February 2009. Liberty Media maintains an active interest in the satellite radio company to this day.

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