The FCC on Friday approved the $22 billion merger of CenturyLink and Qwest Communications with several consumer-friendly conditions, including a five-year requirement that qualifying households receive monthly broadband service for less than $10 and computers for less than $150.
The deal, which would combine CenturyLink, the nation's fifth largest telecom carrier, with Qwest, the third biggest, was approved by the agency's five regulators, three Democrats and two Republicans.
The new company will be called CenturyLink.
The agency did not impose a condition requiring the merged entity to abide by it's tough new "network neutrality" regulations even if they're overturned in court -- as it did with the Comcast-NBC Universal joint venture. An agency source said a net neutrality condition was not required because the new entity is not a major distributor of content and is already subject to the stricter rules, as long as they stay on the books.
That didn't sit well with Free Press, a prominent watchdog group that had sought the additional restriction. "Instead of following precedent and ensuring this merger could benefit the public, [FCC Chairman Julius] Genachowski was unwilling to place any conditions on these companies beyond what they agreed to do voluntarily," said Free Press Research Director S. Derek Turner in a statement.
The new company's service territory covers 37 states, including several out West. The merger, announced on April 22, 2010, was touted as an opportunity to expand broadband services over a 173,000-mile fiber optic network.
The Justice Department previously cleared the deal after determining it would not raise any antitrust concerns, government sources said.
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