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Back Local News Docomo-MCV deal gets FCC nod

Docomo-MCV deal gets FCC nod

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Agreement expected to be finalized May 22

THE Federal Communications Commission has approved NTT Docomo’s proposed acquisition of MCV Guam Holdings, leaving just one last step toward the deal’s completion.

FCC’s Wireless Telecommunications Bureau, the International Bureau and the Media Bureau gave a thumbs-up to the carriers’ transfer application on Friday after concluding that “approving the transaction will serve the public interest, convenience and necessity.”

Jay R. Shedd, president of Docomo Pacific, said the next step goes to the final settlement between NTT Docomo and Seaport Capital, which owns MCV.

“We are expecting everything to be closed by May 22. So that’s when we expect everything to be finalized,” Shedd said. “NTT Docomo is making the acquisition, not Docomo Pacific. They are going to change the business entity name but I am not sure how it will all end up.”

No public harm

FCC green-lighted the Docomo-MCV purchase agreement after getting clearance from the Department of Justice, the Federal Bureau of Investigation, and the Department of Homeland Security on April 24. The federal agencies reviewed the transaction for any potential national security and public safety concerns.

“We find that the transaction is unlikely to result in any public interest harms,” FCC said.

According to the agreement signed on Aug. 27, 2012, Docomo will acquire all of the stocks of MCV. Once the deal is finalized, MCV and its subsidiaries will become wholly owned subsidiaries of Docomo Pacific.

“Upon consummation of the transaction, the resulting entity will have a market share in the U.S. interstate interexchange market of less than 10 percent and will provide competitive telephone exchange services or exchange access services exclusively in geographic areas served by a dominant local exchange carrier in the United States that is not a party to the transaction,” the FCC said.

Cheaper bundles

Docomo’s impending takeover of MCV, which has been approved by the Public Utilities Commission, is touted to result in lower telecommunication service rates for consumers on Guam and the Northern Mariana Islands.

One Economy Corporation and One Global Economy have endorsed the proposed acquisition, saying it “does not raise competitive concerns.”

One Economy said the transaction “will likely lower consumer costs because Docomo Guam could offer bundled service options in competition with the incumbent local exchange carriers.”

One Economy cited its research indicating that cost is an important factor preventing residents, especially in the CNMI, from obtaining Internet services.

Citing FCC’s own survey, One Economy noted that consumers who purchase Internet service though bundles pay $8.55 less per month for service as compared to buying it as a standalone product.

One Economy expects Docomo to be able to offer competitive bundles that could result in significant savings for Guam and CNMI consumers.

MCV currently provides cable television and telecommunications services to business and residential customers in Guam.

Although MCV is also authorized to provide telecommunications services in the CNMI, the company currently provides only cable television service on Saipan, Tinian and Rota.

Docomo currently provides facilities-based wireless services in both jurisdictions.

“Docomo Pacific is pleased that the FCC has approved its application. As the commission's order affirms, this acquisition will serve the public's interest in diversified products and services on Guam and the CNMI. Much work lies ahead, but we are very excited,” Shedd said.

In their joint petition, Docomo and MCV said the merged entity will “continue to offer and expand cable television, high-speed data, and telephone services to customers through upgrades to its network, which currently passes 50,000 residential homes.”

No condition

One Economy has recommended that FCC place a condition on the merger to require Docomo “to implement training and awareness programs for older residents and immigrants to Guam and the CNMI in order to increase broadband use and adoption in the home.”

But FCC decided not to impose the condition on the proposed transaction.

“One Economy does not argue that the transaction will cause any public interest harms with regard to broadband use and adoption, and we find nothing in the record to suggest that it would do so. Indeed, One Economy states that the transaction will likely lower broadband costs for consumers, which we conclude should lead to greater broadband adoption,” the FCC said.

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