With the FCC's conditional approval in place, Comcast can now proceed to the checkout counter with its purchase of Chicago-based CLEC Cimco Communications.
While Comcast has been targeting small to medium businesses (1-20 employees) with DOCSIS-based services, the acquisition of Cimco enables it to advance into the mid-sized business service market with an initial drive in the Chicago-land area.
The Cimco deal, which was originally announced last October, appears to be part of an ongoing acquisition strategy that Comcast has set itself on to expand its business prowess. Not long after it reached a deal to buy Cimco, Comcast entered into an agreement to buy New Global Telecom.
One of the "conditions" that the FCC put on the deal was that while Comcast gets the keys to Cimco's operations, it can't have access to its Detroit properties. The reason is that the FCC has rules in place that prevent a cable operator from acquiring more than a 10 percent financial interest in any local exchange carrier providing phone service in the cable operator's franchise area. When it approved the Cimco deal, the FCC waived that rule for Cimco territories except Detroit. However, if Comcast can get the Detroit Local Franchising Authority to give their approval then the FCC will give a similar waiver.
And while it's possible the Detroit LFA will say no to the waiver, the bigger picture here is that it signifies Comcast's growing presence as a new player in the competitive business telecom market segment.
- LightReadingCable has this article
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