REQUESTS FOR STATE RELIEF ON INTERMODAL PORTING WATCHED CLOSELY

The Neb. PSC recently granted interim relief to carriers such as Great Plains Communications and Hemingford Cooperative Telephone Co. Neb. PSC Comr. Anne Boyle told us last week the commission had received requests for relief from the May deadline from every rural carrier in the state. The PSC plans to hold a 2- to 3-day hearing to gather evidence and consider each individually, she said. “It does not mean that everybody will be provided with relief,” Boyle said of the hearing. “It just means that there is too much diversity among them to be a blanket relief to carriers,” she said.

The state petitions came up in Q&A during an FCBA Wireless Committee lunch Fri. with 8th-floor legal advisers. “The Wireless Bureau has been working really hard with NARUC and others to try to continue to have a dialogue and to make sure that we don’t have various rules in different jurisdictions,” said Sheryl Wilkerson, wireless adviser to FCC Chmn. Powell. “If that were to happen it would be difficult to enforce and difficult for consumers,” she said. “It is a concern and it is something that the Bureau and the Chairman’s office is monitoring very closely.”

“All the states are approaching this a little bit differently,” said one wireless industry source, who estimated more than 400 individual petitions for relief on wireless LNP were pending at the state level. As examples of the variation in state handling, the source noted that although Neb. granted interim relief, the Mich. PSC denied several requests.

State actions include: (1) The Mich. PSC in Dec. denied a request by CenturyTel for a temporary suspension of wireline-to-wireless LNP obligations on wireless carriers in 5 exchanges. CenturyTel cited Telecom Act Sec. 251, which stipulates carriers with less than 2% of U.S. subscriber lines can petition a PUC to suspend or modify LNP requirements. The PSC ruled the issues raised by CenturyTel were solely for the FCC, saying CenturyTel hadn’t argued that numbers can’t be ported beyond the boundaries of the original rate center. (2) The Iowa Utilities Board is considering a petition from the Rural Iowa Independent Telephone Assn. and Iowa Telecom Assn. for suspension of LNP requirements for 2% carriers until costs come down or demand increases. The board sought more information from the petitioners last month.

(3) The S.C. PSC in Nov. granted small carriers a 180- day extension of wireline-to-wireless porting obligations. A hearing is set April 19. Twenty-seven rural carriers asked the PSC to suspend their porting obligations to wireless carriers. (4) The Utah PSC granted relief until May 24, 2005, to members of the Utah Rural Telecom Assn. that sought LNP relief in Feb., including Citizens, Frontier and Beehive Telephone Co. The PSC order March 17 noted that although the FCC has granted relief on LNP deadlines to small, rural carriers, these small carriers “contend that the efforts and economic expenses to themselves and their customers, to prepare to overcome their technical difficulties and prepare to be able to provide LNP upon receiving a bona fide request, outweigh the benefits which a customer may receive from LNP of wireline-to-wireless carriers.” The PSC sought more information on the technical steps each of the carriers must take to carry out intermodal LNP, the related costs and how costs will be recovered from customers. (5) The Va. PUC sought comments last month on a request by Peoples Mutual Telephone for a 12-month suspension of wireless LNP implementation. Comments are due April 19.

The FCC last week sought comments on petitions by several carriers seeking LNP relief. Yorkville Telephone Cooperative sought an extension of the LNP deadline until Aug. 24. TMP Corp. filed a separate petition seeking a waiver of the deadline and an extension until Nov. 24 to support porting. Choice Wireless also petitioned for an extension of the May 24 deadline, asking for a later deadline of Sept. 24. Comments are due April 12.

One source said it would be surprising if there were widespread orders granting more than interim suspensions of LNP deadlines -- particularly because NARUC had advocated so loudly last fall that the original LNP deadlines stand. But a wireless industry source said there was still concern some states might grant open-ended relief without firm LNP deadlines. If that happens, “the consumers that are current customers of those rural LECs will not have the benefit of being able to port their number,” the source said. From a carrier perspective, this could also undermine the intermodal competition goals of LNP,, the source said. “How do you tell big carriers and regional carriers who have implemented it that now you can’t go after a lot of those customers?” the source asked. A common argument in many state filings is the expense for small rural carriers of implementing intermodal LNP. The concern is that the cost mechanisms allowed by the FCC to recoup deployment don’t work with very small customer bases, the source said.

In the case of Neb., Boyle said the smallest rural carrier has 98 lines and the largest outside areas Qwest and Alltel covers has about 35,000. “In my part of the country, there are huge expanses of territory with few people. Wireless doesn’t even work in some of these areas,” she said.

States aren’t expected to grant widespread relief to rural wireline carriers on intermodal LNP, said Medley Global Advisors analyst Jessica Zufolo. “States have much less patience with the wireline carriers than they do with wireless carriers when it comes to competitive issues,” she said: “In the context of number portability, states appear less sympathetic to the interests of LECS both large and small when it comes to arguments that are made against porting.”

Some wireless CEOs raised concerns about the prospects for intermodal porting at the CTIA show last month. T-Mobile USA Chmn. John Stanton said “thousands of independent companies” have been doing whatever they can to get more time or be completely exempted.