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AT&T has made another acquisition

South of the Border, AT&T Strikes Again

Showing just how intent they are on their Mexican invasion, AT&T has made another acquisition just nine days after closing its purchase of Iusacell. This morning they announced a deal to purchase Nextel Mexico from NII Holdings, following through on rumors of their interest since fall.

They will be paying $1.875B for all of NII’s wireless properties in Mexico, including the spectrum, network assets, retail stores, and subscriber base of 3M. All of those will be combined with Iusacell and integrated into AT&T’s dream of a North American network spanning a population of 400M. According to AT&T, the Nextel Mexico assets will be particularly useful in expanding its reach in the country beyond the major metro areas.

Still in the wind are the assets that America Movil plans to spin off to please regulators. AT&T still could take a swing at those, although they are clearly not waiting to see what Carlos Slim plans to divest himself of to the competition he has worked so hard to limit.

The deal for Nextel Mexico will have to get approval not just from regulators but from a bankruptcy court back in New York, where NII Holdings is restructuring.

FCC Order Increases E-rate Program by $1.5 Billion Annually

New FCC Order Increases E-rate Program by $1.5 Billion Annually, and Introduces a Number of New Changes Including “Equalizing” Treatment of Lit and Dark Fiber

On December 19, the FCC released the text of its Second Report and Order in its E-rate modernization proceeding. The new Order increased the annual spending cap on the E-rate program by an additional $1.5 billion—taking the cap from $2.4 billion to $3.9 billion per year starting in the 2015-2016 funding year. This increase was expected after its prior order in July announced a new two-year initiative to fund deployment of WiFi but stopped short of raising the cap. The FCC predicts that requests for funding will “not . . . immediately” reach the new cap, although it notes that it is not possible to “perfectly predict” what levels of funding school and libraries will seek in upcoming funding years. (The new Order also extends the $1 billion annual WiFi initiative for an additional three years, without explicitly noting whether those funds are subject to the overall cap.)

Among the key assumptions driving the FCC’s cost model are that there will be ever-increasing demand for bandwidth (driven in part by the FCC’s new speed goals), and that build-out costs for E-rate supported services will range from $600-800 million annually. It predicts that increased demand for bandwidth will continue to increase by “up to” 50% annually, which will only be somewhat mitigated by a 10% predicted annual decline in per megabit pricing. Other assumed mitigating factors are cost savings the FCC hopes to achieve through its recent reform efforts, including the phase out of voice services. Elimination of support for voice services is estimated to save the program approximately $3 billion over the next five years.

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New 629 Area Code for Tennessee area 615

The Tennessee Regulatory Authority (TRA) ordered an area code overlay adding the 629 area code to the 615 area. This affects the north-central portion of the state of Tennessee serving communities such as Franklin, Gallatin, Hendersonville, Lebanon, Murfreesboro, Nashville and Springfield.

Prior to March 28, 2015 – No Impact: Customers will continue to be able to complete calls to others in the 615 area using 7-digits, 10-digit or 1+10-digit dialing pattern. Although the permissive period ends February 27, 2015 (calling for mandatory 10-digit dialing), EarthLink has configured our switches to continue to allow our customers within the 615 area code to dial 7-digits to reach others within the 615 area code.

March 28, 2015 & After: Impact New customers in the above-named communities will be assigned the 629 area code beginning March 28, 2015. Customers with 615 area codes attempting to reach persons within the new 629 area code will need to utilize 10-digit or 1+10-digit dialing.

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SIP Trunking for Your Business

Did you know that SIP trunking deployment was up 50% in North America in 2013? It is replacing costlier and less flexible voice solutions at an ever-growing rate. SIP trunking supports the move to an all-IP network and delivers other benefits, including:

  • Cost savings that can be achieved within the first few months of switching to SIP trunks
  • Scalability and flexibility to deliver the call capacity you need
  • Support for alternate routing and disaster recovery plans
  • Enhanced collaboration and responsiveness via unified communications

If you have any questions about SIP trunking, please feel free to contact me. I look forward to learning more about your network needs.

Nicky Smith, President/CEO

Level 3 to Buy TW Telecom for $5.7 Billion

Level 3 Communications Inc. (LVLT -5.83%) agreed to buy business Ethernet provider TW Telecom for about $5.7 billion in cash and stock, a deal that would expand the metropolitan footprint of the long-haul Internet carrier.

The deal values TW Telecom at $40.86 a share, a 12% premium to Friday’s close. Shareholders would receive $10 in cash and 0.7 share of Level 3 for each share of TW Telecom.

TW Telecom shares rose in early trading to approach the offer price.

Level 3 Chief Executive Jeff Storey pointed to TW Telecom’s extensive local operations, which he said would complement Level 3’s global assets. Level 3, an operator of Internet networks that help companies send videos or other content more quickly, has network and data centers in more than 60 countries, along with global subsea networks.

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