Charter Communications has refused to cooperate in a review to determine if the company is meeting its merger obligations to customers in California.

The Public Advocates Office of the California Public Utilities Commission reports that Spectrum was required to offer at least 300 Mbps internet service to all households in its California service area by December 31, 2019. It was a key condition required of the cable company to win approval of its 2016 merger with Time Warner Cable. But after getting its merger, Charter officials have stopped cooperating with the Public Advocates Office, which is required to submit annual progress reports on Charter’s compliance.

“Charter’s reports thus far have consisted only of bald assertions, without any supporting household data, that it is providing download speeds of up to 300 Mbps to a certain percentage of households and, as stated in its 2017 report, 400 Mbps to a certain percentage of households,” the Public Advocates Office wrote in a Notice of Ex Parte Communication.

“Charter has refused to provide all data requested by the Public Advocates Office, making it impossible for the Public Advocates Office and the Commission to verify whether Charter is, in fact, in compliance with [its merger obligations},” the Office stated. “[I]f Charter fails to comply with merger conditions, the Commission may pursue appropriate enforcement remedies, including the imposition of fines.”

The Public Advocates Office won the granting of a motion to compel Charter Communications to provide the information, signed by Administrative Law Judge Karl J. Bemesderfer.

Officials in the Justice Department are asking T-Mobile and Sprint to spin off a portion of their networks to lay the foundation to create a new national wireless carrier, with its own network, as a deal condition for approving their $26.5 billion merger.

Bloomberg News reports the launch of a new “fourth largest” U.S. wireless company would help win Justice Department approval for the merger deal, according to unnamed sources. Such a network could be created with the spinoff of Sprint’s Boost Mobile, a prepaid MVNO dependent on Sprint’s wireless network. Since a considerable percentage of Sprint’s existing network was expected to be scrapped after the merger won approval, Sprint could theoretically give up part of its network that would have been deemed redundant anyway to appease regulators. But Wall Street is unlikely to approve of the prospect of creating a new competitor, especially in a transaction designed to reduce the number of wireless competitors in the United States.

Boost Mobile, according to Reuters, could be worth $3 billion in a sale — potentially more if an already-built wireless network is included in the deal.

Critics wonder why the Justice Department would approve a deal merging T-Mobile and Sprint at all if officials were worried about reducing the number of wireless options for consumers. Industry observers suspect T-Mobile and Sprint would be unlikely to support such a network spinoff plan, and the resulting emergence of a new carrier likely to be even smaller than Sprint would leave it in a difficult position in a marketplace that would be dominated by three much larger national carriers planning to spend billions to develop 5G networks.

A source told Bloomberg News Justice Department antitrust chief Makan Delrahim “still wants four carriers” and remains unmoved by T-Mobile and Sprint’s arguments that combining operations would lead to more competition and lower prices for consumers. 

Many state attorneys general remain opposed to the merger, fearing that it will lead to less competition and higher prices.  They are waiting for the Justice Department to make its decision before contemplating lawsuits to block the merger if the deal wins approval in Washington.

(Reuters) – A group of potential buyers are preparing bids for prepaid wireless brand Boost Mobile in an upcoming sale valuing the offshoot of U.S. wireless carriers T-Mobile US Inc and Sprint Corp at up to $3 billion, interested buyers told Reuters.

The $26 billion deal between T-Mobile and Sprint won approval from the U.S. Federal Communications Commission last week after the two carriers offered concessions. It included the sale of Boost to reduce the combined company’s market share in the prepaid wireless business, where customers pay for phone service at the beginning of the month and are not required to pass a credit check.

While the deal awaits a ruling from the U.S. Department of Justice, interested parties are already preparing bids. The sale process is expected to begin after the Justice Department’s review.

Q Link Wireless, a prepaid brand and the third-largest provider of federally assisted wireless plans, is putting together a package to bid for Boost with private equity backing and could pay between $1.8 billion to $3 billion, founder and Chief Executive Issa Asad told Reuters.

The price will depend on the quality of Boost’s customers, such as their level of churn, or the rate of customer cancellations, the devices they are using, and what type of phone plan they are on, none of which the companies have disclosed, he said.

This month, analysts at Cowen estimated Boost has 7 million to 8 million customers and a transaction could be valued at $4.5 billion if the deal included wireless spectrum, or the airwaves that carry data, and facilities. Sprint has not disclosed the number of Boost customers.

Stephen Stokols, chief executive officer of prepaid wireless company FreedomPop, said an undisclosed private equity group he is speaking with have placed Boost’s future value at about $4 billion, such as in an initial public offering.

While FreedomPop is not a bidder, Stokols said he is advising a private equity group preparing a bid. If that bid succeeds, he believes the group would combine their acquisition with FreedomPop and have him lead a combined company with the Boost assets.

Peter Adderton, founder of Boost Mobile who sold the U.S. business to Nextel in 2004, which was then acquired by Sprint, has also said he is interested in buying back Boost. He declined to comment on his valuation for the business.

Adderton said he and his lawyers have urged regulators to require T-Mobile and Sprint to also divest wireless spectrum to ensure Boost will be a viable competitor in the market.

Adderton added that regulators must also ensure the new T-Mobile does not employ anticompetitive practices to harm Boost, and the contract between the companies should be non-exclusive, which would allow Boost to buy network access from other carriers.

The current sale agreement is devoid of details, but with the right terms, “we can create a dynamic player that will compete in the market,” Adderton said of Boost.

T-Mobile and Sprint did not immediately respond to requests for comment.

Reporting by Sheila Dang; Editing by Kenneth Li and Lisa Shumaker

Charter Spectrum customers in New York State: today is the final day to claim free services as part of the state’s $174 million settlement with the cable operator.

About 700,000 customers, mostly in downstate New York, should have already received $62 million in refunds averaging $75 per household in the form of a bill credit. But many more are still qualified for up to three months of HBO or six months of Showtime for free. At the end of the term, services will automatically deactivate so you will never be billed for them.

The offers:

• Current subscribers who subscribe to both internet and cable television from Spectrum will have a choice of either three (3) months of HBO OR six (6) months of Showtime. (Note: This benefit is available to subscribers who do not already subscribe to both of the offered services through Spectrum.)
• Internet only subscribers will get one (1) month of Spectrum TV Choice streaming service—in which subscribers can (depending on their location) access broadcast television and a choice of 10 pay TV networks—as well as access to Showtime for one (1) month.

You can determine which offer you qualify for, if any, on your March 2019 billing statement, available from Spectrum’s website. Or call 1-833-422-8795 and you can learn more about what is available to you and select the free service of your choice. The deadline is today, May 30.

If you are new to Spectrum or already subscribe to HBO and Showtime, you will not qualify for either settlement. Neither will ex-customers that disconnected service.

New York Attorney General Leticia James is interested in learning your views and experiences on the settlement offer. After calling Spectrum, visit here to complete a survey.

Frontier Communications is selling its wireline and fiber assets in Idaho, Montana, Oregon and Washington in a $1.35 billion all-cash deal with two private investment firms.

Frontier will continue operating its FiOS and traditional landline networks in the four states until the transaction closes with regulator approval.

The buyers are WaveDivision Capital, a private investment firm run by the founder of Wave Broadband, an independent broadband provider serving the Pacific Northwest and Searchlight Capital Partners, a Wall Street investment firm seeking to “accelerate value creation” for its investors. The new owners plan to launch a new company to service existing Frontier customers and will honor existing contracts and service commitments.

“The sale of these properties reduces Frontier’s debt and strengthens liquidity,” said Dan McCarthy, Frontier’s president and CEO, in a statement. “We are pleased to have a buyer with extensive experience building and operating advanced fiber-based communications assets in these regions. We will be working very closely with the new owners to ensure a smooth, successful transition for our customers and the communities we serve.”

About 150,000 fiber, 150,000 copper and 35,000 fiber video customers are impacted by the sale in the four affected states. Frontier’s service area in the region is made up of large former Verizon service areas, many upgraded to fiber-to-the-home service, and a significant number of rural telephone exchanges operating with traditional copper wire networks. WaveDivision Capital claims it wants to invest in Frontier’s existing network to upgrade service and potentially retire additional copper infrastructure in favor of fiber.

Frontier service areas in Oregon, Washington, and Idaho.

“We are excited to transition these operations to a local ownership team and to invest in building out the network of next generation fiber throughout our region,” said Steve Weed, CEO of WaveDivision Capital, and founder and former CEO of Wave Broadband. “We are big believers in the Northwest’s future growth opportunities and that future runs on broadband. As the former leaders of another successful Northwest internet provider, Wave Broadband, we know what it takes to bring fiber and other advanced services to residential and business customers, give them choices, and keep them happy.”

Frontier, which has been struggling with a tremendous debt load and underinvestment in its network, sees the sale as a way to improve its balance sheet and cut both debt and expenses. The Pacific Northwest is a difficult region to serve because it is sparsely populated and can be a high cost area because of difficult terrain or long distances between customers. Although Frontier had committed to spending on upgrading its fiber customers, it promised little for its copper wireline customers still relying on low-speed DSL. Weed says his company hopes to change that.

“Our plan is to invest further in our markets, specifically by extending fiber to more homes and businesses, to bring them the high speeds they want,” Weed said in a statement.

Frontier’s Montana operations are in the northwest corner of the state, near the Kootenai National Forest.

The transaction is subject to regulatory approvals by the Federal Communications Commission, the U.S. Department of Justice, the Committee on Foreign Investment in the United States (CFIUS), applicable state regulatory agencies, and certain local video franchise authorities where Frontier FiOS operates. Frontier expects little opposition to the deal.

Weed’s involvement in Wave Broadband is no more, but at the time he left the company, Wave had reached 140 cities and towns in Washington, Oregon, and California. Wave was formed in 2003 with a series of strategic acquisitions of “distressed” independent cable systems and those owned by pre-bankruptcy Charter Communications, Northland Communications, and Cedar Communications. In May 2017, Wave Broadband was sold to TPG Capital for $2.36 billion, and today operates under TPG’s leadership with its close cousins RCN and Grande Communications.

Weed has a reputation for successfully deploying fiber networks in a region where capital can be difficult to find and easy returns on investment are rare, so there is considerable good will he will successfully upgrade Frontier service areas that have been neglected for years.

Although the transaction could deliver temporary fiscal relief for Frontier, shareholders remain displeased with the current leadership team at the company, and there are still significant signs Frontier remains in serious financial and operational distress, especially because of its ongoing customer losses. Frontier is likely to be pressured to find other sales opportunities, assuming it can find willing buyers.