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GCI Advances Plan to Take On Verizon's Alaska Push

Fri, 08/24/2012 - 7:20am
Maisie Ramsay

Alaska wireless operator General Communications, Inc. has kicked off a plan that could help it head off looming competition from Verizon Wireless.

GCI filed a formal application with the FCC this week to create a joint venture with Alaska Communications Systems Group. Together, the companies plan to operate a new statewide network through the new company, named Alaska Wireless Network.

The joint venture was announced in June but the companies have only now filed their application with the FCC, beginning the official process to close the deal. The FCC is giving parties until Sept. 21 to file opposition to the transaction, with replies to those due Oct. 1. The final round of comments is due Oct.11.

Under the terms of the arrangement, GCI will buy $100 million worth of assets from Alaska Communications and contribute them to the joint venture. GCI will own two-thirds of the company, while Alaska Communications will hold the remaining portion. Both operators are contributing spectrum, cell sites, towers, backhaul and switching systems.

The operators have not specifically said they will construct an LTE network, but their FCC application states the transaction "would enhance their ability to provide advanced wireless broadband services, including Long Term Evolution (LTE)." Each company will still offer wireless service under their own brand, and do not plan to transfer retail customers to the joint venture.

The joint venture comes as Verizon Wireless is preparing to enter the Alaska market through a partnership with Matanuska Telephone Association (MTA). The regional operator is leasing Verizon 700 MHz spectrum spanning 34,000 square miles, which it will use to construct an LTE network providing service to both its own customers and Verizon's. The tie-up, arranged through Verizon's rural LTE program, was announced in March. Verizon said at the time it was in the process of  building out its LTE network in Alaska, but did not say when the MTA deployment would be complete.

Verizon could be a formidable competitor to GCI and Alaska Communications. The operator carries a broader line of wireless devices than the regional providers, and its LTE network covers three-quarters of the U.S. population.

AT&T is currently the only national competitor in Alaska.

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