The Federal Communications Commission has approved the merger of Alaska’s two largest cellphone service providers. The companies prefer to call it a joint venture.
The Alaska Wireless Network will be a subsidiary of both GCI and ACS, but GCI will be the majority owner. Customer bills will continue to come from each company.
The move is designed to compete with national providers. GCI Vice-President David Morris calls the joint venture a preemptive move against the larger carriers AT&T and Verizon.
He says that GCI and ACS realized “that building two cell towers , having two switches, having two sets of fiber optic cable to provide the same service, it would be more efficient for us to reduce operating expenses, those capital expenditures, to combine those assets.”
Morris says the new Alaska Wireless Network is for mobile coverage only – not Internet or cable television. He would not says what impact the merger would have on monthly rates.
“If you look at the pricing right now, the local carriers are already less expensive than the national carriers. So, we’ll see,” Morris says.
The merger required approval from both the FCC and U.S. Department of Justice.
Alaska Senator Mark Begich serves on the Commerce Committee, which oversees federal wireless policy. He says the move is not anti-competitive.
“Verizon is going to play big. They’re going to put in a lot of capital. That’s going to create some competition, even more competition than we have today, Begich says. “And after that we have AT&T in there. Then you have three big players.”
As part of the approval, Alaska Wireless has agreed to expand rural coverage. Morris says the new company will provide at least 2-G service in rural Alaska and some areas will get 4-G coverage.