Cable Television

DEPARTMENT OF COMMERCE AND CONSUMER AFFAIRS

Cable Television Division

DAVID Y. IGE
GOVERNOR

CATHERINE P. AWAKUNI COLÓN
DIRECTOR

JI SOOK “LISA” KIM
CABLE TELEVISION ADMINISTRATOR

FOR IMMEDIATE RELEASE

Dec. 8, 2017

State Conditionally Approves Transfer of Hawaiian Telcom Service Company, Inc.’s

O`ahu Cable Franchise to Cincinnati Bell Inc.

HONOLULU – The state Department of Commerce and Consumer Affairs’ (DCCA) Cable Television Division (CATV) conditionally approved the merger transaction transferring control of Hawaiian Telcom Services Company, Inc.’s (HTSC) O`ahu cable franchise to Cincinnati Bell Inc. (Cincinnati Bell).

Cincinnati Bell provides entertainment and communications services to more than 142,800  video subscribers in Indiana, Kentucky, and Ohio. Cincinnati Bell, HTSC and Hawaiian Telcom Holdco, Inc. (Holdco), the parent company of HTSC, filed an application in August to indirectly transfer control of HTSC’s Hawai`i cable franchise on O`ahu, pursuant to a merger transaction between Cincinnati Bell and Holdco.

“Upon an extensive review of the merger transaction application and related filings, which included a public hearing, we determined that the proposed transfer of HTSC’s O`ahu cable franchise to Cincinnati Bell, with the conditions imposed on by the state, is in the public’s best interest,” said CATV Administrator Ji Sook “Lisa” Kim. “As set forth in the Decision and Order, Cincinnati Bell is committed to improving and extending HTSC’s networks in Hawai`i and continuing to provide a low-cost Internet option for Hawai`i’s consumers.”

Decision & Order No. 370 giving DCCA’s conditional approval for the merger can be viewed at https://cca.hawaii.gov/catv. The requirements outlined in the Decision and Order include:

• Invest $20,000,000 to improve and build out HTSC’s networks and infrastructure in Hawai`i; and build out, at a minimum, 15,000 new or upgraded line extensions of HTSC’s networks to homes throughout the state within four (4) years of the close of the merger transaction.

• Adhere to all terms, requirements, conditions, and obligations of the current Cable Franchise Decision & Order, and any other orders and directives issued by the Director, including obligations related to system upgrades; institutional network connections; franchise fees; public, educational or government (i.e., PEG) access; Hawai`i Public Television Foundation; and all other existing cable franchise obligations.

• The merger will not result in service disruption or termination and will not involve a change in any customer’s existing service provider.

• Holdco and its subsidiaries, including HTSC, will continue to be locally managed from Hawai`i and its union labor agreements will be honored.

• Extension of HTSC’s current promotion of offering low-cost Internet service at speeds of up to seven (7) Megabits per second (Mbps) download and up to one (1) Mbps upload for NINE AND 95/100 DOLLARS ($9.95) per month.

• Adhere to federal laws and state rules regarding customer privacy standards and requirements for telecommunication carriers with respect to all of HTSC’s services, including customers of cable and broadband services, throughout the state.

• Commit to adhering to the principles of the 2015 FCC’s Open Internet Order (of no blocking, throttling (slowing down) or paid prioritization of Internet service) in the state for at least three (3) years after the closing of the merger transaction; with the option to seek relief if a change in the law results in competitive disadvantage or harm.

• Provide and deploy a mobile application that facilitates out-of-home public WiFi throughout the state within two (2) years of the close of the merger transaction through partnerships with Hawai`i businesses.

The merger and transfer of HTSC’s O`ahu cable franchise will not take place until all state and federal regulatory review of the merger transaction is completed.

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For additional filings relating to this merger, please click here.