Comcast has officially filed its request for the Federal Communications Commission’s approval of its acquisition of Cimco, a CLEC that caters almost exclusively to the small- and medium-size business (SMB) market.
The process is open to comment, in part because federal approval also depends on the approvals of local franchising authorities. Comcast calculates there are 274 local franchising authorities.
The Communications Act of 1934 would prohibit the purchase unless the FCC decides that such a merger is not anticompetitive and that it would serve the public interest. Comcast is arguing that its proposed acquisition of Cimco should be approved on both grounds.
Comcast, as quoted by the FCC, said the proposed transaction has “no anticompetitive effects, because Cimco and Comcast have focused their voice services on different market segments and for the most part do not compete with each other.”
Further, Comcast argues the proposed transaction will help meet “the convenience and needs of the community to be served” because the effect of the transaction would be to: “(i) help Comcast to compete more effectively in the medium-size and enterprise business marketplace, (ii) provide substantial benefits to Cimco’s existing customers, and (iii) promote facilities-based competition.”
Cimco offers various telecommunications services – including local exchange, long distance and data services – in Illinois (particularly in the Chicago metropolitan area), Indiana, Michigan, Ohio and Wisconsin. It also provides interexchange long distance communications services in 40 other states, plus the District of Columbia, and local exchange telephone services to business customers in approximately 298 local service areas throughout the states identified above, in which Comcast or one of its affiliates holds a franchise to offer cable television service, according to the filing.
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