Special Access Reform Advocates Step up Pressure on FCC
Advocates of special access reform said their patience is wearing thin as the long-awaited FCC data request continues to founder. “From the customer point of view, this delay has been unconscionable,” said Levine Blaszak telco lawyer Colleen Boothby. She represents the Ad Hoc Telecommunications Users Committee, which includes NTCA and other special access customers, such as banks. The commission promised her clients that a second data request would be out by last January, Boothby said. “There’s always some reason for why there’s a delay in the process,” she said. “Every dollar businesses can save by not paying exorbitant special access rates is a dollar they can put into the economy, into creating jobs.”
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Sprint has been the most active in its special access lobbying, commission records show. The company has filed 22 ex parte notices or comments since the beginning of the year, records show. Last week, the company met with commission staff -- the sixth such meeting since April, records show (CD June 29 p13). “There is a very loud cry for reform,” Sprint spokesman John Taylor said. “There are competitors in the marketplace that have presented evidence in the docket that the marketplace is broken and that it’s a failed market.”
The FCC has already concluded a voluntary data request on special access facilities and has been working on a second voluntary request on special access revenue. Both the voluntary data request on revenue and a draft mandatory request are hung up by Paperwork Reduction Act review, lobbyists and an FCC official said. A commission spokesman said “staff is actively working on a second public notice asking for additional voluntary submissions of data."
"Anyone asserting that ILECs have a stranglehold over the business market is seriously out of touch with the marketplace,” USTelecom Vice President Glenn Reynolds said. “The cable industry reports growth in this market of more than 20 percent a year and the three largest cable companies each earn more than a billion dollars in business revenues. Microwave backhaul for cell tower service is also widely utilized. In fact, Sprint itself relies on ILEC special access for cell backhaul for less than 10 percent of its 4G Clearwire service. These facts simply cannot be squared with claims being made by Sprint or other CLECs in this proceeding."
In meetings, advocates of special access reform have urged the commission to bypass the paperwork act by focusing on AT&T, Verizon and CenturyLink. “We discussed the Wireline Competition Bureau’s reliance in the NECA letter [in the universal service proceeding] on its broad statutory authority under Section 220 of the Communications Act to require information from companies regulated under Title II,” the Ad Hoc committee said in a June 13 ex parte notice. “We urged the Bureau to use the same statutory authority to collect cost accounting data from AT&T, Verizon, and Qwest to determine whether the supposed competition in special access markets has been sufficient to ensure that rates are just and reasonable."
The second voluntary request may not be issued until August, telco and commission officials said. “It remains troubling that the FCC hasn’t released the second data request on Special Access services, since that information is the second half of really getting a comprehensive understanding of competition in the marketplace,” tw telecom Vice President Kelsi Reeves said. “Also troubling is the fact that the FCC had been targeting release of the information for April, and we'll be in July this week. We do not understand what the possible holdup could be.”
"Special access reform is long overdue,” XO Communications Vice President Lisa Youngers said. “In 2000, AT&T, Verizon and Qwest (now CenturyLink) had 93 percent of the special access lines; in 2007, they still held about 89 percent. These monopolies hold all the cards, and without effective regulation a monopoly can dictate terms to its customers. American consumers and businesses would be better served by real competition, and that requires the FCC to act.”
Incumbents say their opponents are arguing in bad faith. CLECs, for instance, are clamoring for more data on big companies’ special access revenues -- but aren’t willing to share their own data, incumbents have claimed. The commission “should guard against allowing competitors to use the data request process to obtain access to highly confidential competitive information and to impose highly burdensome requests on providers and buyers when the requested information would not advance the Commission’s investigation,” Verizon said in a February filing.
Despite suggestions by their opponents that incumbents are trying to hide special access facts from regulators, AT&T is looking forward to the next round of data requests, company spokesman Michael Balmoris said. “This is the third time the FCC has requested data from the industry on a voluntary basis in this proceeding. We have responded each time, others have not,” he said. “We have said from the onset of this proceeding that data from all providers is essential to answering questions about competition for the services at issue here.”