WIRELINE BUREAU MULLS ‘INTERIM’ RULES’ IF UNE REGIME VACATED
FCC Wireline Bureau Chief William Maher said the bureau is looking at possible “default rules” for carriers if the FCC’s UNE regime is vacated as a result of the U.S. Appeals Court, D.C.’s, ruling on the agency’s Triennial Review Order (TRO). At a media breakfast Tues., Maher said UNE relationships among carriers are governed by interconnection agreements, and most of those agreements have “change of law” provisions that determine what happens if FCC rules or laws change. However, terms vary among carriers and from agreement to agreement, so the agency is looking at whether there should be a “backup set of provisions,” he said.
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It’s “obvious” that the bureau should consider contingency plans, Maher told reporters. While interconnection agreements “govern in the first instance,” the bureau is considering whether anything else is needed, for example in a case where change of law provisions were left out of an agreement, he said. Such action might be done on an interim basis, he said: “Internally, we're just looking at options.”
In answer to a question, Maher said he didn’t expect rates to rise as a result of the court’s order. Critics have expressed concern that the Bells might raise wholesale rates to competitors, which could increase consumer rates. “Most change of law provisions provide for some period of time for the parties to work out differences,” Maher said. Publicity surrounding these issues “is a strong incentive to all parties not to act hastily,” he said.
The future of the FCC’s narrowband UNE rules has been in flux since the appeals court vacated them in March. The court stayed the effectiveness of its decision until June 15, recently refusing a request to extend the stay, even though appeals to the U.S. Supreme Court are expected. The FCC, possibly supported by the U.S. Solicitor Gen., is expected any day now to ask the U.S. Supreme Court for a stay, as are NARUC and some competitive carriers. If the Supreme Court doesn’t agree to a stay, the FCC’s rules will be vacated June 16.
On another issue, Maher revealed the Wireline Bureau and the Office of the Inspector Gen. are conducting an “informal inquiry” into conflict of interest questions that recently led to the resignation of top executives at the National Exchange Carriers Assn. Asked what such an investigation entails, he said the agency “calls in the company to see what’s behind” the resignations.
On intercarrier compensation (ICC), Maher said even though an industry group didn’t reach consensus, anything it produces would help the FCC Wireless Bureau as it moves forward on the issue. “I'd be interested in seeing some output” from the industry’s Intercarrier Compensation Forum because the group reportedly has developed some “good data points” that could help the FCC, Maher said. Regardless, the FCC has to move forward because the current system of “competing sets of compensation rules” encourages arbitrage, he said. Maher said the FCC is working on both the broad ICC proceeding started in 2001 and more targeted issues, including a reciprocal compensation remand and petitions for declaratory ruling. For example, he said, wireless carriers have sought action on rural carriers’ access tariffs.
The bureau may produce a package of ICC proposals or pull out some that need more immediate attention, he said. The target for action is the end of the year, although he conceded that’s “a blink of an eye” in regulatory time. He said his one priority is a “unified vision” for intercarrier compensation. Asked later about the fact that some groups dropped out of the industry forum because they had special needs, Maher said “there’s room for differences in a vision.” For example, rural carriers are traditionally treated somewhat differently by regulators, he said.
Maher said the agency also would like to take action on VoIP by the end of the year, or at least on “a big piece of it.” For example, a pending Vonage petition is a place where the Commission “could give clarity,” he said. Vonage has sought a ruling that its service is an information service, meaning an interstate service under FCC jurisdiction.
On the e-rate program, Maher said he thought the program was “very much a success story” in bringing Internet connections to schools but “there have been some bad actors involved in the program.” The House Commerce Committee’s Oversight & Investigations Subcommittee had planned a hearing on e-rate fraud and waste today (Wed.), but it was among numerous activities cancelled this week as a result of ex- President Ronald Reagan’s funeral. The problem, said Maher, is that “when people apply for money, people sometimes lie or they try to work the system.” He said the FCC “will do everything we can to eradicate fraud and waste and abuse to the extent there is some.”