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News recap: Comcast acquisition gains traction; ACA seeks Title II exemption

In this week's news recap: The net neutrality battle hits smaller cable operators and California has some tough love for Comcast's pending acquisition of Time Warner Cable.

In telecom news, the American Cable Association is asking the FCC  to exempt small and mid-size cable and broadband providers from obligations that would come with Title II reclassification. Meanwhile, California tentatively approved Comcast's acquisition of Time Warner Cable, with conditions.

Gigabit broadband services are picking up steam as AT&T announced it is ready to roll out services in Kansas City, Mo., and CenturyLink plans to expand its deployments.

ACA asks for Title II exemption

The American Cable Association (ACA) is asking the Federal Communications Commission (FCC) to exempt its members from Title II reclassification of broadband services.

The ACA represents several hundred small cable companies, half of which have fewer than 1,000 subscribers. Many of them also offer broadband and video services, which would subject the providers to new net neutrality rules and regulations if the FCC votes for Title II reclassification.

ACA President and CEO Matthew Polka wrote in an editorial for The Hill that smaller providers lack the market power to threaten the Open Internet. He said Title II regulation would create new compliance and reporting obligations, which would lead to high out-of-pocket costs for the smaller providers.

"It could potentially lead to an increase in fees [that]cable broadband providers pay for pole attachments and add new costs associated with complying with enhanced transparency requirements," Polka said.

Although the FCC appears to be pursuing the adoption of Title II regulations for broadband providers, it has also said it won't impose certain Title II rules, such as the requirement to file price tariffs.

Comcast acquisition receives tentative approval

The California Public Utilities Commission tentatively approved Comcast's $45.2 billion acquisition of Time Warner Cable, but Comcast has objected to the conditions of the commission's approval.

The conditions of the acquisition include the combined company promising not to block cities and towns from building their own broadband networks, offering broadband speeds of 25 Mbps within five years, and that improving service reliability.

The commission also said Comcast must improve how the provider brings broadband to low-income residents, setting guidelines that include expanding eligibility, providing free Wi-Fi routers and signing up at least 45% of eligible households within two years.

Comcast Executive Vice President David Cohen said in a statement that the majority of the commission's conditions will benefit consumers, but he objected to some of the requirements.

He said some conditions, like signing up 45% of eligible low-income households, are unrealistic under market conditions. He said such requirements "create a more intrusive regulatory regime where innovative services could be hampered rather than helped."

In addition to state approval, the acquisition must get federal approval.

Gigabit broadband war heats up

Gigabit broadband services are gaining traction as AT&T announced it's ready to sell its gigabit fiber service, Gigapower, in Kansas City, Mo., and nearby suburbs.

AT&T said it is ready to connect the service to homes and small businesses at prices and speeds that match Google Fiber. AT&T will offer an Internet service with speeds of up to 1 Gbps at $70 per month. An Internet and TV package will cost $120 per month. AT&T will also offer an Internet-based phone service for $30 per month, a service that Google Fiber does not offer.

Mike Scott, president of AT&T Kansas, told the Kansas City Star that the carrier is "pleased to be in the ballgame."

CenturyLink is also planning to expand its gigabit service beyond its initial 10-market lineup, which now includes Phoenix, Seattle, Denver and Omaha, Neb.

In an earnings call, CenturyLink executives said the carrier is driving fiber deeper into its networks and is expanding its deployment of Gigabit Passive Optical Network (GPON) technology over fiber lines to deliver consumer and business services.

CenturyLink COO Karen Puckett said the carrier likes "the halo effect" from gigabit service launches in early markets.

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Despite the ill will towards Comcast currently, I'd agree with them that signing up 45% of eligible low-income households is an unrealistic target to set.
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