CWA applauds FCC for further investigation of Verizon-TracFone deal and its impact on Lifeline customers

CWA praised the FCC this week for taking a critical step to evaluate the consumer impacts of Verizon’s proposed acquisition of the prepaid wireless company TracFone. In new information requests issued to Verizon and TracFone on April 14, the FCC required the companies to disclose crucial details around Verizon’s plans for the takeover, including specifics on how it plans to transition TracFone’s approximately 1.7 million low-income subscribers of the Lifeline program to its network.

“CWA and a growing coalition, including seventeen state attorneys general, have been urging the FCC to more closely scrutinize how Verizon intends to serve TracFone’s millions of low-income families who rely on the Lifeline program,” said Brian Thorn, senior researcher, CWA. “We applaud the FCC’s decision this week to seek critical information needed to evaluate this deal and ensure it is in the best interests of consumers.”

In its information request, the FCC explicitly asks whether Verizon plans to continue to offer all current TracFone Lifeline plans to new and existing customers, whether it plans to change any terms and conditions of those plans, and Verizon’s intentions for its plan pricing compared with current TracFone plans. In addition, the FCC is inquiring into Verizon’s plans to offer improved terms and conditions in Lifeline service plans, such as higher speeds, increased data allowances or allowed voice minutes or texts, and whether Verizon plans to increase the price of the service offering. 

The FCC is also seeking a more detailed proposal on how Verizon intends to migrate current Lifeline customers to its network and its timeline for doing so, and documents presented to Verizon’s Board of Directors and investors around the proposed acquisition. The FCC's request for information, including asking Verizon to quantify the public interest benefits it is claiming, reflects the complexity of this transaction and need for close public scrutiny, despite Verizon's repeated attempts to avoid accountability.

TracFone currently serves approximately 22 percent of total Lifeline subscribers in 43 states and the District of Columbia. By contrast, Verizon only offers its mobile wireless service to Lifeline customers in parts of four states. While the $6.9 billion deal was unveiled in September, Verizon has yet to make binding commitments that TracFone subscribers will not lose service, nor has it committed to continuing to provide services for Lifeline and prepaid customers, including non-English-speaking customers.

Links:

FCC seeks more details from Verizon in TracFone deal (CWA, Apr. 16, 2021)

FCC  information requests issued to Verizon and TracFone (FCC, Apr. 14, 2021)