Today’s Regulatory Mix: CPUC Proposes Conditions: Verizon, TracFone Merger
CPUC Proposes Conditions: Verizon, TracFone Merger
The California Public Utilities Commission (CPUC) issued a Proposed Decision under which it would approve Verizon Communications’ acquisition of TracFone Wireless. The CPUC reviews proposed telecommunication mergers and acquisitions to ensure they are in the public interest. Presently, the CPUC finds that the TracFone acquisition fails does not meet this standard. The CPUC indicated the companies would have to adopt a number of specific measures to protect consumers from price increases or service disruptions:
- Verizon and TracFone must participate in the California LifeLine program for as long as they operate in California, and Verizon must offer California Lifeline plans, phones, and devices in its stores.
- To ensure that TracFone maintains a significant level of participation in California LifeLine in future years, TracFone and Verizon must have enrolled at least 200,000 California LifeLine subscribers by June 30, 2023. Additionally, at least 15 percent of those California LifeLine subscribers must be in low-income disadvantaged communities.
- Verizon must provide new phones to current TracFone customers with phones that are incompatible with Verizon’s network, including California LifeLine customers, at no additional cost. In areas where Verizon offers 5G, it must offer these California LifeLine customers 5G-enabled phones.Current TracFone customers that cannot remain TracFone customers because they are not located in an area served by Verizon must be provided free phones.
- In order to facilitate a predictable and timely transition for customers, Verizon and TracFone must migrate all TracFone customers to Verizon’s network within six months following the close of the acquisition, giving priority to TracFone’s current California LifeLine customers.
The CPUC’s Commissioners are scheduled to vote whether to approve the Proposed Decision at the CPUC’s November 18, 2021 meeting.
The Regulatory Mix, Inteserra’s blog of telecom related regulatory activities, is a snapshot of PUC, FCC, legislative, and occasionally court issues that our regulatory monitoring team uncovers each day. Depending on their significance, some items may be the subject of an Inteserra Briefing.