FCC Chairman Tom Wheeler is proposing ILECs receive significant forbearance relief, a senior agency official said Tuesday. Wheeler circulated a draft order granting several aspects of a USTelecom petition in docket 14-192 asking the commission to stop applying various regulations to the regional Bells and other local incumbents, the staffer said. Included is relief from certain wholesale obligations that Granite Telecommunications has said are key for competitors serving multioffice businesses in many areas (see 1511120031). The petition is due for a decision by Jan. 4. Wheeler is putting the draft order on the tentative agenda for the FCC’s Dec. 17 meeting, the staffer said.

Sprint and two carrier groups urged the FCC not to extend comment dates again in the special-access rulemaking, as requested by USTelecom and ITTA (see 1511100068). "This request amounts to yet another transparent, groundless attempt to delay action in this important rulemaking,” Sprint said in opposition filed in docket 05-25 Thursday. It said the FCC should “promptly reject this request and thereby send an unambiguous message that it is committed to moving this proceeding to an expedited conclusion.” Incompas, joined by the Competitive Carriers Association, noted the incumbent telco request came less than two weeks after the commission largely granted a previous ILEC request by extending comment and reply deadlines to Jan. 6 and Feb. 5. “This time, the incumbents ask that the deadlines be delayed until 12 weeks from the time when the data set is ‘stable’ and all 'remaining impediments' to analyzing the data are removed,” Incompas and CCA said in their opposition. “The incumbent LECs have failed to show that the newly-established pleading cycle ... deprives interested parties of a reasonable opportunity to participate in this rulemaking.” Incompas and CCA disputed the ILECs’ “tired” and “implausible claim” that proceeding delays were the fault of competitors that have been seeking a new special-access framework for a decade. “Of course, it is the incumbent LECs, not the competitive LECs, that have a powerful incentive to delay the resolution of this proceeding since every extra day of delay is one more day of unreasonably high special access service profits for the incumbent LECs,” said the two competitive carrier groups. They said their members “must pay those high prices" and thus want to complete the proceeding as soon as possible. Sprint said the delays were “directly traceable to the actions of USTelecom’s members,” noting CenturyLink and Verizon filed “corrective” data submissions. Sprint, Incompas and CCA countered the USTelecom/ITTA arguments that an extension was needed to analyze the complex industry data collected by the FCC, with the competitive groups saying an ILEC expert’s declaration “exaggerates the problems with the data and the impact that these issues will have on the parties' ability to conduct a timely analysis.”

FCC and industry officials continue to seek to devise new rural USF mechanisms. The details have always been difficult, but tensions have surfaced in FCC public statements and industry filings and interviews over the basic scope and timing of the reform effort as a year-end commitment to a key lawmaker nears. Three commissioners are trying to develop a broadband-oriented overhaul, while two commissioners are more adamant the agency undertake a targeted “stand-alone broadband” fix in December, even if an overhaul takes longer. Rural telco groups are working with regulators to hash out policy proposals, and some believe the parties are close to a solution. But at least two of them, NTCA and WTA, appear concerned the FCC might rush into making major changes to legacy systems that would be harmful to their members.

USTelecom disputed Granite Telecommunications arguments opposing ILEC relief from certain FCC wholesale obligations. USTelecom said Granite believes Communications Act Section 271 Bell duties and ILEC 64 kbps wholesale voice duties give CLECs a "regulatory backstop" to obtain UNE-P (unbundled network element platform) replacement products from the incumbent telcos. “Granite’s imagined ‘regulatory backstop’ is not real and has been expressly disavowed by the FCC. UNE-P replacement products are the result of marketplace conditions that have enabled negotiated commercial agreements,” USTelecom said in a letter posted Wednesday in docket 14-192. "Regulatory obligations did not cause these agreements, and they do not ‘backstop’ them. Any savings claimed by Granite resulted from market conditions, not regulatory ‘backstops.’” Granite recently suggested it would stop serving 1.4 million lines and there would be consumer welfare loss of $4.4 billion to $10.2 billion if CLECs lost wholesale rights targeted by a USTelecom forbearance petition, which is due for a decision Jan. 4 (see 1511120031). USTelecom said the provisions Granite cites require ILECs to offer wholesale access to certain network elements, but don’t require them to offer a wholesale voice platform. “By implying that they do, Granite resurrects and tries to re-litigate issues that were settled years ago in the Commission’s UNE proceedings,” USTelecom said. “There is no requirement that companies assemble the various elements available under the sections and rules Granite cites into a finished wholesale business voice service.” A 2011 FCC amicus brief in a 6th U.S. Circuit Court of Appeals case (BellSouth v. Kentucky PSC, No. 10-5311) confirmed that ILECs aren't required to recreate UNE-P, USTelecom said. A Granite representative had no comment Wednesday. The company did respond to a recent Verizon filing in the docket that argued a 2005 FCC forbearance order -- citing strong cable competition to Qwest (now CenturyLink) in Omaha, Nebraska -- supported the USTelecom petition. Granite said that order didn’t address the kinds of multilocation business customers Granite serves, the “vast majority” of which don’t have cable alternatives. Granite said there is no basis to assume Verizon and other ILECs would lose many customers to cable if CLECs have to pull back due to ILEC wholesale relief. CLECs have no concrete assurances Verizon and other ILECs will continue to offer commercial platform services in the absence of the regulations, Granite said.

NCTA and USTelecom praised House passage Monday by voice vote of the FCC Process Reform Act (HR-2583) (see 1511160048). “The legislation is an important step that will provide for streamlined regulatory processes and increased regulatory certainty,” said USTelecom President Walter McCormick. “This bipartisan legislation encourages the important goals of greater transparency, public participation and predictability in FCC decision making, even more important in today’s competitive communications marketplace,” NCTA said. TechFreedom considers the measure “very good news for consumers even though it was watered down in order to get bipartisan support,” said Tom Struble, policy counsel. “For too long, the FCC has operated as a Star Chamber, proceeding in secret and hiding critical information from public view.” The bill faced partisan opposition during the markup due to three GOP proposals that were since dropped from the legislation, securing its bipartisan passage. “This effort arises from complaints and suggestions from the public and from various commissioners over the years under various chairs,” said House Communications Subcommittee Chairman Greg Walden, R-Ore., one of the bill's authors, Tuesday during his opening statement for an FCC oversight hearing. “Better process at the FCC will result in more transparent decision-making, where all the commissioners have a meaningful opportunity to participate. And Chairman [Tom] Wheeler, while you have made important improvements -- you’ve reduced backlogs, implemented a new complaint process among other items -- members of your own commission are driven to publicly express their frustrations with the bigger, decisionmaking process. It’s distressing to hear of the bitter divisions.” Wheeler thanked the House for passing the legislation, during the oversight hearing. “We can all support the notion that all American people, and not just the lobbyists and corporations, should have access and input on the FCC rules that impact our daily life,” said Rep. Adam Kinzinger, R-Ill., another of the bill authors.

U.S. carriers aren't taking the necessary steps to block unwanted calls to their customers, Consumers Union said in a report Tuesday. CU said phone companies aren't responding to pressure from the FCC to put in place technologies to block robocalls. The FCC in June “made clear that phone companies have the legal authority to offer call blocking tools to their customers, and Chairman Tom Wheeler has urged them to do so,” CU said. “But the top phone companies have resisted offering advanced filtering technology to all of their customers, citing concerns that customers may not receive wanted calls.”

The FCC granted USTelecom's request to withdraw without prejudice a request for structural separation relief that was part of a broader pending forbearance petition, in a Wireline Bureau order issued in docket 14-192 Monday. The targeted structural separation regulation covers ILECs in the provision of long-distance service. The bureau noted there was "limited discussion in the record" on that particular forbearance request. An FCC decision on the USTelecom petition, which seeks relief in various other areas, is due to Jan. 4.

USTelecom filed a legal challenge to the FCC IP technology transition decisions adopted in August that were intended to safeguard competition and consumers as telcos switch from copper-based traditional services to IP-based services over fiber networks (see 1508060044). USTelecom filed a petition for review in the U.S. Court of Appeals for the D.C. Circuit (USTelecom v. FCC, No. 15-1414) against FCC orders that grew out of a 2014 FCC NPRM, declaratory ruling and subsequent USTelecom petition for reconsideration. "In the Order and Order on Reconsideration, the Commission not only denied USTelecom's petition for reconsideration of the Declaratory Ruling, but also took a number of final actions in the rulemaking it initiated in the Notice, including: adopting new rules governing the retirement of copper facilities; declaring that a carrier must seek Commission approval under § 214(a) if a change in its service will cause a wholesale customer of that carrier to discontinue, reduce, or impair its own retail service offerings; and adopting a new rule under which it will condition its approval of § 214(a) applications for certain services on the applicant's provision of a reasonably comparable, wholesale Internet Protocol service, on reasonably comparable rates, terms, and conditions," USTelecom said. Incompas General Counsel Angie Kronenberg emailed us Monday: “First, the Bells tried lobbyists. Now they will try the lawyers, but they cannot fight the future. Competition is the answer, and it’s driving new networks.” Public Knowledge Senior Vice President Harold Feld emailed us: "This is not unexpected. USTA and its members have made their opposition to the FCC's order fairly clear. We believe the FCC acted entirely within the scope of its authority and in a manner reasonably calculated to protect and advance the pro-consumer and pro-competition goals of the Act -- and that the court will ultimately affirm the Commission." FCC spokesmen had no immediate comment.

A federal court should deny Neustar’s challenge to an FCC decision giving Telcordia conditional rights to be the next local number portability administrator (LNPA), argued intervenors CTIA, Telcordia and USTelecom. The FCC in March reasonably rejected LNPA incumbent Neustar’s argument that Telcordia wouldn’t be a neutral administrator, the intervenors said in their brief Thursday to the U.S. Court of Appeals for the D.C. Circuit in Neustar v. FCC, No. 15-1080. They said it was undisputed that Telcordia met the first two prongs of a three-prong neutrality test: that it isn't affiliated with a telecom carrier and that it doesn’t receive most its revenue from, or issue most of its debt to, such a carrier. On the third prong, they disputed Neustar's argument that Telcordia would be subject to “undue influence” by an entity with a vested LNPA interest because its parent Ericsson had contacts with Sprint and T-Mobile. The FCC found no evidence of such undue influence, the intervenors said, but as a precaution it imposed “numerous structural safeguards,” including forcing Ericsson to transfer its Telcordia stock to a voting trust and requiring Telcordia to have an independent board. They said Neustar challenged the FCC’s neutrality finding “largely under the false premise” that Telcordia and Ericsson should have been treated as one entity. “Neustar relies primarily on Delaware law, but Delaware law unequivocally recognizes that a ‘corporation is an entity, distinct from its stockholders even if the subsidiary’s stock is wholly owned by one person or one corporation,’” they said, adding that the question nevertheless is a federal one and the FCC reasonably concluded Telcordia and Ericsson are separate entities. The intervenors said Neustar’s procedural arguments were “equally meritless” for various reasons; “Neustar had more than ample notice and opportunity to comment on the FCC’s selection process and decision -- and it fully availed itself of that opportunity.” Finally, they said, the FCC “correctly” accepted Telcordia’s bid over Neustar’s. Telcordia “refuted Neustar’s inflated estimates of the transition costs," they said. Although their brief redacted the bid amounts, Commissioner Ajit Pai said in March that Telcordia bid less than $1 billion for a seven-year contract (less than $143 million per year), when Neustar’s existing contract cost about $460 million for 2014. “That’s substantial savings for the American public,” he said. The Department of Justice and FCC recently filed a brief defending the commission order (see 1510290029).

USTelecom believes the FCC and industry are "close to the finish line" in the effort to overhaul rural USF voice subsidy mechanisms to support both broadband and voice service by rate-of-return carriers. USTelecom is "committed to reaching agreement on the few remaining points that need to be resolved," said a filing posted Thursday by Robert Mayer, USTelecom vice president-industry and state affairs, after a meeting with FCC and state officials. "I noted that USTelecom had been working closely with a group of associations and our members on the plan and that we had members who were leaning towards the proposed Model option and others who were interested in the Non-Model option. I indicated that it was in our mutual interest to reach agreement among the participating associations," Mayer's filing said. NTCA earlier this week warned there wasn't enough time to adopt a broad rural USF overhaul this year, though more targeted reforms to fix the "standalone broadband problem" were more doable (see 1511100064). Other groups posted short filings Thursday in docket 10-90 noting FCC meetings on USF issues.