USTelecom Petition for Forbearance Draws Support from Big ILECs

Verizon said the petition was “a ready-made vehicle to promote the nation’s transition to next-generation networks,” which focuses on some of the “most egregious examples of outdated and counterproductive regulation” (http://xrl.us/bm3asf). For example, aspects of the Section 214 service discontinuance rules and Part 51 network change rules “add cost, delay, and uncertainty to network investment without any commensurate consumer benefit,” Verizon said. Forbearance from those rules would “promote the IP transition and help accelerate efforts to deliver new services to consumers.” Part 32 accounting rules for price cap carriers are similarly “misplaced in a world of next-generation networks,” Verizon said, saying no federal regulator, consumer or competitor makes use of the mandated set of regulatory books.

CenturyLink said the petition “demonstrates in great detail the futility of the regulatory provisions in question, due to fundamental changes in technology, the onset of fierce competition in the telecommunications industry and, in some cases, the mere passage of time” (http://xrl.us/bm3asq). Complying with the “broad array of inconsistent and illogical regulatory requirements” is a wholly unnecessary burden, CenturyLink said, and consumes resources “that could be better used for broadband investment.” Much of the requested relief has already been applied to some carriers and services, the telco said, pointing to the forbearance granted to the Bell Operating Companies on equal access scripting, cost assignment, Automated Reporting Management Information System (ARMIS) 43-01 and structural separation requirements. “Independent ILECs generally must still comply with these same, or similar, pointless requirements,” it said.

The National Cable & Telecommunications Association said it “generally does not oppose the significant forbearance USTelecom is seeking” on behalf of ILECs, but said any grant of the petition should be conditioned on ILECs continuing to file all data needed to calculate pole attachment rates currently required in ARMIS 43-01 (http://xrl.us/bm3atn). “There is no competition (and no prospect of such competition) that constrains the ability of pole owners to impose unreasonable rates, terms, and conditions for pole attachments,” NCTA said. “Without ARMIS data, no attaching party could calculate the rates for attaching to an incumbent LEC’s poles or determine whether any rates are reasonable."

CompTel opposed the petition, arguing USTelecom lacks standing to request relief on behalf of all ILECs (http://xrl.us/bm3avz). “USTelecom is not a telecommunications carrier, but rather a trade association whose members are telecommunications carriers,” CompTel said. Even if its status as an association could qualify it as a class of telecommunications carriers, “USTelecom has not alleged that all of the ILECs on whose behalf it seeks relief are members.” If USTelecom does have standing, the commission should still deny the petition because USTelecom failed to make a prima facie showing that forbearance is warranted, as required under Section 1.54(b) of the commission’s rules, it said. “USTelecom’s failure to present any evidence of the state of competition in any of the markets served by the ILECs on whose behalf it seeks relief makes it impossible for the Commission to perform the market power analysis required to determine whether competition is sufficient to grant forbearance."

Sprint Nextel generally opposed the petition, arguing the commission needs the ARMIS information to make informed decisions in ongoing reform proceedings (http://xrl.us/bm3awd). But it agreed that current requirements that carriers maintain certain records at various physical locations are outdated, and the commission should let carriers keep those records in electronic form.

The NYPSC worried that the elimination of the service discontinuance requirements could affect low-income customers in the state (http://xrl.us/bm3a5r). It urged the FCC to consider alternatives that could protect consumers from the potential loss of Lifeline services. If no alternative is implemented, the FCC should reject the forbearance of this regulation, the state commission said.

The California Public Utilities Commission (http://xrl.us/bm3a28) hasn’t extended local exchange competition beyond the territories of AT&T, Verizon, SureWest Communications and Frontier Communications, it said. As a consequence, the territories of the rural rate-of-return ILECs by law aren’t open to local exchange competition from other wireline service providers. Additionally, in many of these territories, the only provider of local wireline service is the ILEC, and in those areas, the ILEC is the only provider a customer can call to establish local exchange service, CPUC said. While cable companies may offer service in the territories of California’s small rural ILECs, they can’t offer local exchange service because they can’t lawfully interconnect or obtain local telephone numbers in rate centers within territories where competition is barred, CPUC said.

USTelecom “exaggerates” the role of wireless in disciplining the rates, terms, and

conditions of basic local exchange service, said the National Association of State Utility Consumer Advocates, Maine Office of the Public Advocate and the New Jersey Division of Rate Counsel, in a joint filing (http://xrl.us/bm3a4d). Cable companies’ market entry has led to, “at best, a duopoly,” they said. It doesn’t represent effective competition, they said. They claimed cable companies don’t offer “economic substitutes” for stand-alone local services. The Michigan Public Service Commission (http://xrl.us/bm3a4q) noted that USTelecom didn’t mention that many of its members offer services through wireless and VoIP subsidiaries of their own companies and many provide broadband services. These services aren’t regulated in the same way as the legacy services, it said.

In its petition, USTelecom called the rules “vestiges of a bygone era” when telephone companies only offered circuit-switched services and consumers could only buy local voice service from their ILEC (CD Feb 17 p14). Its 73-page petition (http://xrl.us/bm3asb), which sought forbearance from dozens of rules, said the commission had already identified many of the rules as unnecessary in its Biennial Review report released two months earlier.