Today:  FTC Reschedules Hearing on Vertical Mergers, FCC Rural Health Care Funding In Alaska, FCC T-Mobile Sprint Proceeding, FTC Competition and Consumer Protection

FTC Reschedules Hearing on Vertical Mergers

The Federal Trade Commission announced the agenda for its hearing on vertical mergers that was originally scheduled for September 14, 2018 but was postponed due to inclement weather.  The new hearing date is November 1, 2018, at the Georgetown University Law Center in Washington D.C.  The event will examine vertical merger analysis and the role of the consumer welfare standard in U.S. antitrust law.  See detailed agenda.  The FTC invites public comment on these issues, including on the questions listed below by December 31, 2018.

1. Should the U.S. antitrust agencies publish Vertical Merger Guidelines? What guidance should they provide regarding the assessment of the competitive effects of vertical mergers, including the substantive theories of competitive harm and the treatment of transaction-related efficiencies?  Under what conditions, if any, should the guidelines recognize a presumption of anticompetitive harm? What showing should be required to overcome such a presumption?  Under what circumstances, if any, should behavioral remedies be accepted to remedy the likely anticompetitive effects of vertical mergers?
    
2. Is the “consumer welfare standard” the appropriate standard for evaluating compliance with the antitrust laws? What are alternative frameworks with which to evaluate compliance with the antitrust laws? What are their strengths and weaknesses? Is there empirical support for preferring one standard instead of another standard?

FCC Rural Health Care Funding In Alaska

The FCC announced that it has awarded GCI Communications Corp. (GCI $77.8 million in RHC funding for FY 2017.  This will help health care providers in the state afford the connectivity they need to  deliver critical telemedicine services, while promoting fiscally responsible administration of the Program.  The award was issued after the FCC completed an investigation to ensure that all carriers participating in the program followed program rules.  The investigation was undertaken after the FCC found that two non-Alaska carriers apparently falsified documentation to inflate their rural rates and boost their payments from the program since such payments are based on the difference between the urban and rural rates for the affected services. 

Carriers in Alaska receive over half of all funding from the Telecom Program, reflecting the importance of telecommunications services for the delivery of high-quality health care to the many remote areas of the state.

FCC T-Mobile Sprint Proceeding

The FCC announced that Professor David Sibley is serving as the outside economic consultant for the FCC task force coordinating the agency’s review of the proposed transaction between  T-Mobile US, Inc. and Sprint Corporation. Professor Sibley has been assisting the task force, led by David Lawrence and comprised of personnel from around the Commission, since August 2018. 

FTC Competition and Consumer Protection

The FTC issued a media release for its hearings on competition and consumer protection in the 21st century.  The hearings will continue with discussions on multi-sided platform businesses, acquisitions of nascent competitors, and antitrust in labor markets.  “We are fortunate that Professor Sibley is bringing his considerable economic experience and expertise to bear in this review,” said Chairman Pai. “Rigorous economic analysis plays an important role in all of the Commission’s work and will be essential to a thorough investigation into whether approval of this transaction would be in the public interest.” 

Sibley is the John Michael Stuart Centennial Professor of Economics at the University of Texas at Austin.  Previously, Professor Sibley was Deputy Assistant Attorney General for Economic Analysis in the Antitrust Division of the U.S. Department of Justice, the highest-ranking economics position in the Antitrust Division.  He has consulted extensively for various firms and agencies, both in the United States and abroad, on antitrust and regulatory matters. He has also served as a consultant to the Antitrust Division of the U.S. Department of Justice and the U.S. Federal Trade Commission in several significant merger cases.

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The Regulatory Mix, Inteserra’s blog of telecom related regulatory activities, is a snapshot of PUC, FCC, legislative, and occasionally court issues that our regulatory monitoring team uncovers each day. Depending on their significance, some items may be the subject of an Inteserra Briefing.