WASHINGTON-The Federal Communications Commission saw its review of telecommunications mergers curtailed by a Senate committee last week just as it was succeeding in extracting 26 merger conditions from SBC Communications Inc. and Ameritech Corp., and it approved the transfer of Aliant Communications Inc.’s licenses to Alltel Corp.
The Senate Judiciary Committee voted unanimously to institute a “shot clock” on FCC merger reviews. Under the bill, the FCC would have six months to review mergers valued at more than $15 million and three months for smaller mergers. A majority of the commission could extend these deadlines by 60 or 30 days, respectively. The FCC has taken more than a year in reviewing the SBC/Ameritech merger.
The bill was passed after Sens. Mike DeWine (R-Ohio) and Herbert Kohl (D-Wis.) and Sen. Orrin Hatch (R-Utah), chairman of the Judiciary Committee, reached a compromise.
The merger commitments extracted from SBC/Ameritech go directly to the question of local exchange competition. Hatch said he does not think the FCC should be reviewing competition issues.
SBC and Ameritech have agreed to 26 conditions-with attached fines of potentially $2 billion-in an attempt to have their merger approved by the FCC. The FCC announced the conditions, which focus on local exchange competition, at a press conference last week. SBC and Ameritech were expected to deliver the details of the proposal in an amended application for license transfer by the end of the week. Transferring control of communications licenses is a key portion of the merger process.
The conditions were in response to an April 1 letter sent by FCC Chairman William Kennard to SBC Chairman Edward E. Whitacre Jr. and Ameritech Chairman Richard C. Notebaert, saying the license transfer could probably not be approved without conditions.
The FCC will put the detailed proposal out for public comment and should reach a decision soon, said Robert Atkinson, deputy chief of the FCC’s Common Carrier Bureau. The Department of Justice approved the merger in March but state regulators in Illinois and Indiana are still reviewing it.
The FCC’s approval of the Aliant/Alltel license transfers is different than a merger review, said FCC Commissioner Harold Furchtgott-Roth. Although he agreed with the license transfer, he argued in a separate statement that a merger constituted much more than simply transferring the communications licenses. Furchtgott-Roth also railed against what he termed “the ad hoc process for reviewing license transfers.”
