Pacific Dataport questions FCC safeguards on GCI's $310 million Quintillion purchase

Pacific Dataport, an Anchorage broadband company, told Federal Communications Commission staff last week that the conditions the agency attached to GCI's $310 million purchase of Quintillion may not guard against anticompetitive conduct.

Shawn Williams, Pacific Dataport's vice president of government affairs and strategy, met with FCC officials four times Oct. 21-23, according to the company's notice of the meetings. One meeting dealt only with the acquisition. The others also covered school internet funding and federal subsidy programs.

The acquisition "would further concentrate control of Alaska's critical middle-mile infrastructure, diminish competition, and increase barriers to entry for competing broadband providers," Williams wrote. The company raised concerns about what it called excessive wholesale middle-mile prices in Alaska and questioned whether the FCC's access conditions would produce "genuinely fair, reasonable, and competitive rates rather than perpetuating existing market disadvantages." It also asked whether there is meaningful oversight to make sure GCI keeps its commitments.

The FCC had already ruled. On Oct. 20 the agency's Office of International Affairs denied a petition from Alaska Communications Systems to block the sale and approved the transfer of Quintillion Subsea Operations' submarine cable landing license to GCI, with three conditions drawn from GCI's own commitments.

GCI must honor Quintillion's existing contracts and pricing for the life of the system, with price adjustments allowed for yearly inflation above 5% starting three years after closing, and must extend existing contracts with its wholesale customers in communities both networks serve. It must offer open access at just and reasonable rates on the rural portion of the Quintillion network and on GCI middle-mile transport to those overlapping communities. And it must give the FCC copies of certain contracts so the agency can monitor compliance.

Alaska Communications filed its petition July 16, with support from economist Hal J. Singer. As Alaska News reported Oct. 5, the company asked the FCC to block or condition the sale and offered more than $75 million for 20 years of guaranteed access. GCI and Quintillion, in reply comments, pointed to competition from Starlink and other low Earth orbit satellite services and to GCI's pledge to extend existing contracts. The FCC's order said Singer's analysis did not consider cost savings from the merger.

Pacific Dataport called the Alaska Communications petition "very strong" and questioned the FCC's rejection of Singer's recommendation.

In the other meetings, the company described delays in USAC's 2026 E-Rate funding decisions for rural Alaska schools and libraries and urged reforms to federal subsidy programs, including not paying a monthly subsidy for a home that has chosen Starlink.

At both Oct. 23 meetings, the company handed out comments from an April 22 Alaska's News Source Facebook post about the deal. Most of the comments criticize GCI's prices and outages.

The filing raises questions but does not ask the FCC for a specific remedy.