FCC rubber stamps $6bn Verizon, TracFone deal
Fourteen months and more than $6 billion later, TracFone Wireless is now part of Verizon.
Verizon's acquisition of the MVNO crossed the final regulatory hurdle on Monday when the US Federal Communications Commission (FCC) gave its approval.
The path is now cleared for Verizon to onboard 20 million TracFone Wireless subscribers, in line with the conditions set out by regulators concerning low-income consumers.
A statement from Kathy Grillo, Verizon SVP & DGC, public policy and government affairs said customers would benefit from "a continued commitment" the federal Lifeline scheme, of which TracFone is a primary provider.
“Verizon welcomes the FCC’s approval today of our TracFone acquisition. The deal will provide customers with the best of both worlds: more choices, better services and new features thanks to Verizon’s investment and innovation. Customers will benefit with enhancements in devices, network performance and innovative products and services -- as well as a continued commitment to Lifeline.
She continued: “We thank Chairwoman Rosenworcel, the Commissioners, and the FCC staff for their leadership and commitment to the public interest. We also want to thank the commissioners, ALJ and staff of the California Public Utilities Commission, as well as many community-based organisations that expressed support for this transaction.
“We will work hard to serve TracFone’s current customers and look forward to serving new ones in this dynamic and fast-growing marketplace,” Grillo's statement concluded.
Verizon first announced its intent to acquire the service provider from América Móvil in September 2020. At the time it said: "Verizon expects to bring its award-winning 4G LTE and 5G networks and other innovative technologies to Tracfone customers, further develop Tracfone’s distribution channels, and expand Tracfone’s market opportunities."
The Justice Department gave its approval for the deal last November, however the California Public Utilities Commission only approved the deal on 18 November this year, after the two parties agreed to additional consumer protection conditions, in part concerning TracFone's 1.7 million Lifeline customers.
Verizon and TracFone set out their commitments to Lifeline in a letter to the FCC earlier this year. Their commitments included:
TracFone will offer Lifeline services for at least three years
TracFone will continue to offer a Lifeline plan at no charge to the consumer
Verizon will actively market and advertise Lifeline services
The reseller agreements Verizon is assuming from TracFone will be honored
5G will be available to Lifeline customers
Verizon will provide quarterly reports so the FCC can monitor Verizon’s compliance with these commitments.
Now the deal is complete, Verizon said it has committed to participate in Lifeline for "at least seven years" and will offer existing TracFone Lifeline rate plans until at least the end of 2024.