As 2002 state legislative sessions get under way, sampling of prefiled and newly-introduced legislation indicates early interest in telemarketing, spam, phone rates, and car phone safety, along with other wireless issues.
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LAS VEGAS -- Sirius Satellite Radio’s 2002 rollout plans will have predictable ring of familiarity as new CEO Joseph Clayton told news conference Mon. at Consumer Electronics Show (CES) here that aim would be to repeat successes of 1994 DirecTV launch over which he presided as senior Thomson-RCA executive.
Verizon and Fla. Office of Public Counsel reached $3.1 million settlement of service quality and slamming complaints dating back to 1996. Settlement, which will be considered by Fla. PSC at its Jan. 22 meeting, would require Verizon to pay $2 million penalty to state to close out late repair and installation complaints between 1996 and 1999. It would pay another $1.1 million penalty to state to settle slamming complaints from 1998 against its Verizon Select Services unit. Settlement is well below $19 million penalty Public Counsel originally sought but well above $259,000 fine PSC staff had recommended. Verizon said settlement would allow it to put past behind it so it could concentrate its efforts on service excellence in future.
Stakeholders in NextWave case talked Thurs. about possible options in response to unwillingness of Congress to codify proposed settlement by end of last year. Although FCC and Dept. of Justice supported $16 billion deal with bankrupt carrier that would have required return of auctioned C-block licenses, congressional action was needed to put $10 billion back into U.S. Treasury and allow NextWave to keep $6 billion after taxes. Sources said decision whether to revive proposal in some form was unlikely before end of day, but said negotiations would continue.
SBC Communications will buy 3% stake in Yahoo from SoftBank America, SBC said. SoftBank America is subsidiary of SoftBank, international technology company with origins in Japan. Company holds more than 16% of Yahoo’s stock, making it Yahoo’s single largest shareholder. SBC purchase is intended to strengthen relationship between SBC and Yahoo, companies said.
Librarian of Congress has sent dispute between MPAA and Independent Producers Group (IPG) back to arbitration panel for yet another try at settlement. MPAA and IPG are fighting over 1997 cable royalty funds and how to divide them. Register of Copyrights said neither side had produced reliable evidence to determine how money should be divided, only that MPAA appeared to be owed lion’s share. Copyright Arbitration Royalty Panel (CARP) made original recommendation in April that IPG deserved 0.5% and MPAA rest. But 2 months later Librarian dismissed all of IPG’s claimants with exception of Litton Syndications and asked CARP to adjust accordingly. CARP then awarded IPG 0.212% and MPAA 99.788%. Register of Copyrights has rejected that as well and sent it back to CARP for another try. “Given the lack of reliability of MPAA’s and IPG’s presentations, crafting awards from the current record would constitute arbitrary action,” Register said.
N.J. Board of Public Utilities (BPU) approved 90-day extension of Verizon’s price regulation plan, to March 31, saying it was unable to complete its deliberations on carrier’s proposal for successor price cap program by original plan’s Dec. 31 expiration date. Without extension, Verizon automatically would have reverted to rate-of-return regulation Jan. 1. Verizon cap proposal wouldn’t increase rates for basic services, but would allow more flexibility in pricing competitive services and increase by $20 million carrier’s commitment to provide advanced data services to state’s public schools and libraries.
Covad exited bankruptcy Thurs., eliminating $1.4 billion high-yield and convertible bondholder debt under plan approved Dec. 13 by U.S. Bankruptcy Court, Del. Covad said court approval of plan filed Aug. 15 also satisfied conditions for $150 million funding from SBC that included loan and restructuring of existing resale and marketing agreement. New funding will supplement Covad’s existing cash balance, allowing DSL carrier to finance operations until it’s cash-flow positive in 2nd half of 2003, it said. Under court-approved plan, carrier eliminated debt by paying bondholders combination of $257 million cash and common stock representing 15% ownership of company. Original shareholders retained about 80% of company, Covad said. SBC ownership, now at 5%, didn’t increase as result of bankruptcy plan.
Merger deal announced Tues. night by Comcast Corp. and AT&T comes at time when FCC has no ownership cap in place by which to measure if combination of nation’s first and 3rd largest cable is too big. New company, called AT&T Comcast Corp, will have about 22 million subscribers, be major presence in 17 of nation’s 20 largest cities and be competitor in 41 states. AT&T’s decision, which received unanimous approval by its board Tues., came after Comcast significantly upped its original $44 billion price offered, and rejected, over summer. Under terms of agreement, AT&T will spin off its broadband unit and simultaneously merge it with Comcast. New company assumes nearly $20 billion in debt and other liabilities from AT&T and its subsidiaries, as well as $5 billion of AT&T subsidiary securities held by Microsoft Corp. Microsoft agreed to convert that $5 billion into 115 million shares of new company.
Verizon Wireless outlined revised terms for its acquisition of Price Communications. Deal was announced in Nov. 2000 with $2 billion tag. Verizon Wireless said Wed. it had agreed to combine business operations of Price with certain of Verizon Wireless assets in transaction now valued at $1.7 billion, including $550 million in assumed debt. New agreement replaces one announced last year, Verizon Wireless said. Companies plan to create limited partnership of Price’s wireless operations and certain Verizon assets, with latter controlling and managing partnership. Price has more than 560,000 customers in 16 markets in Ala., Fla., Ga., S.C. Price Communications’ partnership stake will be exchangeable into shares of Verizon or Verizon Wireless based on certain conditions: (1) After Verizon Wireless launches IPO and one year after partnership is formed, Price can exchange its stake for shares of Verizon Wireless at IPO price. If Verizon Wireless IPO doesn’t launch within 4 years of partnership’s formation, Price’s stake will convert into common shares of Verizon. In that scenario, exchange price is collared at minimum of $40 and maximum price of $74 per share. (2) Exchange into either Verizon Wireless or Verizon stock would be subject to “certain lock-up and restricted sale provisions.” Previous deal was stock-for-stock transaction that was conditioned on IPO by Verizon Wireless by Sept. 30, 2001. Due to market conditions, IPO was delayed by Verizon Wireless, which is joint venture of Verizon and Vodafone. Under revised terms, Price plans to contribute all of its wireless business assets, including regional call center in Atlanta. In July, Verizon Wireless had said it was altering original terms of agreement, which had consisted of $1.5 billion in Verizon Wireless common stock, with balance of $2 billion represented by assumption of debt.