USTA AND BELL COMPANIES ASK COURT TO STAY FCC UNE ORDER
In a joint filing Fri., USTA and the 4 Bell companies -- BellSouth, Qwest, SBC and Verizon -- asked the U.S. Appeals Court, D.C., to stay the narrowband portion of the FCC’s Triennial UNE Review Order. The sections of the order targeted by the stay request included: (1) Switching/UNE-P provisions. (2) Competitive access to high-capacity loops and dedicated transport. (3) New rules for access to enhanced extended links (EELs), a loop-transport UNE combination. (4) Permission for wireless providers to gain access to UNEs, in particular the high-capacity transport element.
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The Bells’ joint filing said a stay should be granted because they were likely to win in court on the merits and they otherwise would suffer “irreparable injury.” The petition argued that it was “unlawful” for the FCC to continue requiring the Bells to unbundle switching since CLECs had deployed at least 1,300 switches and weren’t impaired without access to Bell switches. It said the unbundling of high-capacity loops and transport was ordered based on “a provisional finding of impairment -- in this case on the theory that, although a staggering amount of competitive facilities had been deployed, the Commission could not pinpoint the precise location of those facilities.”
On the EELs issue, the petition complained that although the FCC said they would be limited to local carriage, the order actually cleared the way for long distance carriers to use them as substitutes for special access service. The filing on the wireless issue said: “The FCC reached this conclusion without any finding that [wireless] providers are impaired in providing wireless services without access to the facilities in question.”
USTA Gen. Counsel Lawrence Sarjeant said the industry was “forced to ask the courts to intervene and delay the implementation of these rules before permanent damage is done to the communications industry and the manufacturers and suppliers.” Qwest Senior Vp Steve Davis said that “the FCC failed to do its job, so now the courts must step in and do it for them.”
The EELs issue was of particular concern to Verizon, Senior Vp Thomas Tauke said in a news briefing earlier Fri. He said that despite the FCC’s assurances that the EELs language protected against the use of EELs to replace special access, Verizon didn’t think the safeguards would work. Verizon officials said the EELs portion of the order could cause the 4 Bells to lose more than $500 million in special access revenue by the end of 2004, $250 million for Verizon alone.
EELs originally was sought by CLECs to serve customers who lived beyond the normal range of their switches. However, their use by long distance companies to replace the special access facilities they leased from the Bells created a major policy dispute, with the Bells arguing that UNEs were intended for local use only, not for long distance purposes. Tauke said the FCC in the UNE order tried to address CLEC complaints about difficulties in gaining access to EELs while maintaining safeguards against special access use. However, he said, the FCC wasn’t successful: “In essence, there are things in the order that aren’t consistent with what the Commission intended.”
Tauke said Verizon representatives had been talking with the FCC about several other areas it thought “clarification” was needed because the order’s language didn’t comport with what the Commission had said it planned to do. Those areas, which Verizon is hoping the agency will fix on its own, either by issuing an addendum or a reconsideration notice, focus on confusing language on the deregulation of UNE requirements for Bells’ broadband facilities.
They include: (1) Applying Sec. 271 unbundling rules to the Bell companies’ fiber installations. Tauke said that although the order eliminated Sec. 251 UNE requirements for fiber, it was not clear whether that also applied to the unbundling requirements in Sec. 271. In Verizon’s case, that could mean unbundling still would be required in its states but not in GTE territories. “Clearly that was not the intent of the FCC,” Tauke said. (2) Limiting the deregulation to fiber-to-the-residence loops rather than the larger universe of fiber-to-the-premises. The 2nd category includes not only homes but also small and medium businesses, Tauke said. He said that was what Verizon had thought the FCC planned to do. (3) Clarifying unbundling requirements for fiber that served multiple dwelling units. Tauke said “it clearly can’t be the intent” of the FCC to ease unbundling rules for single-family homes and not for apartment units.
Meanwhile, a group of competitors late Thurs. filed an opposition to last week’s USTA-Bell request for a stay by the FCC. (USTA said last week that if the FCC didn’t act by today on its stay request, it would have to file with the court instead.) The joint filing, by AT&T, MCI and 8 other carriers and associations, said a stay would create great confusion and harm because the requirements were likely to be restored after appeal. “The reality is that granting a stay would not give the incumbents the relief they seek,” the filing said: “At most it would lead to battles in every state about the meaning of change of law provisions in thousands of interconnection agreements, with decisions then likely superseded by the results on appeal. And, as the incumbents themselves have argued, a stay would not limit the ability of state commissions to mandate unbundling under either federal or state law.”