Windstream Accuses Level 3 of Owing Millions for 'Services Rendered'

Windstream says conditions should be imposed if the FCC approves the CenturyLink-Level 3 merger to prevent practices “contrary to the public interest and fair and reasonable competition."

Edward Gately, Senior News Editor

March 15, 2017

2 Min Read
CenturyLink Level 3 logo

Windstream has joined Frontier Communications in asking the Federal Communications Commission to attach conditions if it approves CenturyLink’s planned acquisition of Level 3 Communications.

In an FCC filing, Windstream said Level 3 in particular has been “unreasonably refusing to pay or delaying payment on millions of dollars for services rendered by Windstream.”

“In addition, since the announcement of the acquisition, Windstream has received a significant number of rate increase notices from Level 3 that are inconsistent with the company’s past practices,” it said. “Like Frontier, Windstream is concerned that the combined entity will use its augmented scale and market power to engage increasingly in these and other practices that are contrary to the public interest and fair and reasonable competition, and are detrimental to Windstream’s continued effort to invest in its network to provide robust and affordable broadband service, particularly in rural and high-cost areas.”

The Commission should adopt conditions to ensure that Level 3 and the combined entity cannot engage in unreasonable bill payment practices, and to prevent it from “using their market power in the business data services (BDS) market to engage in extortionate price increases,” Windstream said.{ad}

Like Frontier, Windstream said it has experienced some improvement in Level 3’s practices since the announcement of the CenturyLink merger and submission of applications to the FCC.

“However, Windstream has concerns that this better behavior will not continue voluntarily if the transaction is approved,” it said. “Moreover, Windstream does not at present have concerns with CenturyLink’s bill-payment practices, but Windstream is concerned that the combined company, which will have greater scale and increased market power, will assume the more problematic practices of Level 3.”

In response to Frontier and now Windstream’s FCC filings, CenturyLink issued the following statement: “We respect the FCC comment process, which gives interested parties the opportunity to offer their comments. We believe that this transaction meets the public interest requirements and will strengthen the nation’s IP infrastructure and provide competitive alternatives for the enterprise business segment.”

Level 3 declined comment.

Windstream said if the Commission decides to grant approval, it should mandate that: Level 3 is required to immediately pay all outstanding amounts as required by the service providers’ applicable tariffs or other contracts; Level 3 or the combined entity must remain current on all billed charges; and the combined entity must adhere to CenturyLink’s best practices.

In addition, to prevent the combined entity from using its market power to raise prices unreasonably, the Commission should mandate that: the combined entity continue to provide the contract rate for a facility purchased under contract, even after the initial purchase term expires; and the combined entity permit wholesale customers to continue to lease these facilities on a month-to-month basis after the initial term has been fulfilled.

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About the Author(s)

Edward Gately

Senior News Editor, Channel Futures

As news editor, Edward Gately covers cybersecurity, new channel programs and program changes, M&A and other IT channel trends. Prior to Informa, he spent 26 years as a newspaper journalist in Texas, Louisiana and Arizona.

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