FCC DEFENDS INTERMODAL LNP RULES AT D.C. CIRCUIT

The Commission told the court “the time for review has long passed. USTA is not likely to suffer irreparable injury in the absence of a stay because it will generally be free to compete to win back any customers it loses.” USTA had told the court that allowing the new rules to take effect would cause “severe harm” by letting customers port wireline numbers to wireless carriers but not allowing LECs to vie for customers served by mobile operators.

The FCC said most wireless customers also subscribed to wireline service, so there were fewer mobile customers whose business a LEC would have a chance of winning under wireless LNP. “At this point, the rate center disparity does not present an actual competitive imbalance,” the FCC said. The order simply resolved an industry controversy by confirming the breadth of the LNP duty that Congress and the FCC imposed on LECs “years ago,” it said.

“USTA’s claim of harm also ignores the reality of the local exchange marketplace: The LECs are virtual monopolists with more than 90% of the wireline market share, and at this point, most wireless customers still have wireline phones,” the FCC said: “The introduction of any type of competition into a monopoly marketplace will necessarily result in loss of customers by the monopolist; indeed, that is what is expected to happen upon introducing competition.” The agency dismissed USTA arguments that customers might not realize phone numbers could not always be transferred back to a LEC if a customer moved. “The mantle of consumer advocate ill suits the incumbent monopolists,” the FCC said. “Competitors on both sides have strong incentives to educate consumers about the costs and benefits of portability.” The agency told the court a stay would harm the wireless carriers that had invested substantially in implementing LNP: “It would be unfair to deprive them of access to the significant wireline market.”

Consumer inquiries to the FCC on LNP this week appeared to bear out reports by many wireless industry analysts and officials that porting volume in the first flush of implementation was lighter than some expected. An FCC spokeswoman said the agency had received 126 consumer inquiries through Tues. on LNP, and no complaints. Research firm Ipsos-Insight released survey results this week that found that 73% of people polled said they weren’t likely to switch cellphone providers in the next year under LNP.

Meanwhile, the Direct Mktg. Assn. (DMA) said Wed. it was reviewing a letter from FCC Consumer & Governmental Affairs Bureau Chief Dane Snowden on how telemarketers could comply with Telephone Consumer Protection Act (TCPA) requirements under wireless LNP (CD Nov 25 p1). DMA had raised concerns about how telemarketers could be notified when a wireline number changed to wireless. Of several options Snowden outlined for DMA for telemarketers, DMA Senior Vp-Jerry Cerasale said one looked the most promising, although the group still was examining the alternatives. Under the scenario he specified, NeuStar would establish a secure Web site for telemarketers using autodialing technology to receive daily updates on wireless numbers.

“What DMA would really like is similar to what we have in place for wireless exchange numbers, in which we get from NeuStar the list of all the numbers assigned to wireless exchanges, and we put that out so that marketers can receive that and know what those wireless numbers are,” Cerasale said. Daily updates of numbers from NeuStar may be a little too frequent for telemarketers who usually need 2 to 3 days of planning before mounting a phone marketing effort, he said. “We would probably need to get some temporal use so that we could download the information every month,” Cerasale said: “Those are the kinds of things we are looking at.”

In response to Wireless Bureau follow-up LNP questions, BellSouth told the FCC this week that if the benchmark for completion of a port were shortened to less than 4 days, it would need at least 10 months to make operating support system changes. Wireless carriers have committed to an industry standard of 2.5 hours to complete a port, compared with rules that required the wireline industry to complete ports in 4 days. That was among the questions the FCC teed up for more feedback in the wireline-to-wireless LNP rules issued this month.

In an intervenor brief, CTIA warned the court that because wireless LNP already had been launched in the top 100 markets, “halting intermodal porting would engender massive customer confusion and market disruption, the very harms that petitioners claim they want to prevent.” CTIA said the USTA had had the intermodal porting obligation of LECs since 1996, but filed an emergency stay request less than one business day before the Nov. 24 wireless LNP deadline. LECs have had a “broad duty” to port numbers to and from mobile operators since 1996, it argued. CTIA said the USTA challenge should have been filed in 1996, calling it “a belated request to stay a regulatory duty that has existed for over 7 years.” It also disagreed with USTA arguments that the wireline-to- wireless LNP rules required location portability. “Because intermodal porting will not impact call rating, a telephone number’s area code will continue to signal the charge that a wireline caller will incur, and callers will not be surprised by unforeseeable toll charges. Nothing will change from the caller’s perspective,” CTIA said.

CTIA argued that a stay of the intermodal rules would create severe harm for consumers and mobile operators. “Intermodal LNP is the linchpin to prying open the local exchange monopoly held by LECs,” it said. Because wireless LNP took effect this week, halting intermodal porting now would mean that ports already in progress would be stalled, “resulting in serious questions as to which carrier is responsible for providing service,” it said.