Verizon Communications Inc. told federal regulators it would continue to support low-cost wireless service for three years if allowed to buy TracFone, a sign of deepening negotiations in the carrier’s effort to control a giant in phone plans. prepaid cell phone.
“We are very comfortable making that commitment to … continued participation in Lifeline for the next three years in any geography where TracFone offers Lifeline services today,” said Ronan Dunne, Verizon’s chief consumer services officer, in an interview Thursday. The operator will also provide ultra-fast fifth-generation, or 5G, service to Lifeline customers within six months of closing the deal, he added.
Lifeline is a federal subsidy for low-income phone users, such as those receiving Medicaid or public housing funds. The Communications Workers of America union and other public interest groups have criticized the proposed merger partners for failing to spell out specific plans to continue supporting the program.
Verizon agreed last year to buy TracFone for up to $ 6.9 billion, a price that includes $ 650 million depending on certain performance targets. TracFone, a unit of Mexican telecoms operator América Móvil SA B, served nearly 21 million US customers at the end of March through brands such as StraightTalk, Net10 and Simple Mobile. Approximately 1.7 million subscribers use Lifeline through its SafeLink Wireless service.
Mr. Dunne and TracFone CEO Eduardo Díaz Corona discussed their proposed commitments last week in a virtual meeting with the Acting President of the Federal Communications Commission, Jessica Rosenworcel, according to a recent document. Companies sometimes agree to agree to certain regulatory conditions in an effort to speed up the approval of a deal. A Rosenworcel spokeswoman declined to comment on the pending settlement.