Broadband privacy, a USTelecom forbearance petition and transaction reviews were also on the FCC Wireline Bureau's agenda outlined Wednesday by bureau chief Matt DelNero at an FCBA event (see 1509300068). He said broadband privacy, which flows from the FCC's decision to reclassify broadband under Title II of the Communications Act, is in the "pre-NPRM stage" and involves various bureaus, but his bureau is taking the organizational lead. He noted the USTelecom petition asking the FCC to forbear from applying various regulations to ILECs is due for a commission decision by Jan. 4 (see 1509250046 and 1509160028). DelNero said the bureau was also devoting "a lot of resources" to reviewing pending transactions, including Charter Communications' proposed buys of Bright House Networks and Time Warner Cable.

AT&T dismissed CLEC claims that the FCC has wide leeway to regulate special-access rates of both traditional TDM business services and newer IP-based services, regardless of what industry data collected by the agency show. CLEC arguments are “baseless,” both procedurally and substantively, AT&T said in a filing posted Tuesday in docket 05-25, responding to a recent filing from Birch Communications, BT Americas and Level 3 (see 1509100050). Any reversal of eight-year-old ILEC forbearance relief on IP-based services would require an NPRM proposing such reregulation, and that hasn’t occurred, AT&T said: “The Commission has not sought comment on ‘unforbearance,’ much less set forth for comment a new regulatory regime for packet-based Ethernet services.” CLEC proposals for “short-cut benchmarks” wouldn’t suffice, because forbearance “is not an ‘on/off’ switch that may be flipped willy-nilly,” AT&T said, citing FCC Chairman Tom Wheeler as conceding as much in March Senate testimony when he said “realistically there’s a lot that you have to go through” to undo a forbearance decision (see webcast at 2:00:27-2:02:25). AT&T further said the FCC has no substantive basis to reimpose rate regulation on ILEC special-access services in a business market that has grown even more competitive in recent years. No ethernet provider has a port share that exceeds one-fifth of the market, and eight have port shares over 5 percent, five of which are non-ILECs, the incumbent telco said. “The enormous success in the U.S. of IP-based services -- with providers investing billions of dollars deploying fiber throughout the U.S. -- is due in large part to the historically light regulatory touch government agencies have exerted,” AT&T said. "To reverse those policies now would be directly contrary to the Commission’s broadband goals.” USTelecom also disputed the CLEC arguments recently (see 1509250043). AT&T posted a blog Tuesday urging the FCC to adhere to Wheeler's mantra of "competition, competition, competition" and his belief that regulation can be low when competition is high. It noted specific competitive moves by Comcast and other cable companies to serve the business services market, including for large enterprise customers.

Rural telco groups offered feedback on, without endorsing, a possible "bifurcated approach" to ILEC cost recovery as part of a potential FCC overhaul of rate-of-return USF support mechanisms. In a letter posted Monday in docket 10-90, USTelecom joined by ITTA, NTCA and WTA said the FCC raised the possibility of a bifurcated approach in its June 2014 Further NPRM under which USF support for investments prior to a selected date would be based on old rules and USF support for investments after that date would be based on new rules. "Over time as companies depreciate and retire assets in the old mechanisms and invest in new assets, costs would organically shift from the old to the new mechanism," the groups said. "Companies who have more recently completed construction initiatives with greater debt obligations will transition more slowly than companies who have not made those investments since new assets will have longer remaining lives and the need for subsequent investment is lower." The groups said none of them was yet ready to endorse such an approach generally, or the specific ideas in their submission, but were submitting the comments to further discussion and analysis.

The Connect America Fund (CAF) cost model "lacks sufficient focus to properly treat extremely high-cost," (XHC) sparsely populated areas of Wyoming, the Public Service Commission replied in FCC docket No. 09-197. It responded to CenturyLink and USTelecom initial comments. The PSC is concerned that the FCC hasn't realigned "frozen support" for price-cap eligible telecom carriers (ETCs) to offer voice service in XHC areas, especially since CenturyLink refused CAF Phase II in Wyoming. In states where the incumbent price-cap carrier rejected CAF II support -- as in Wyoming -- the PSC recommends that all Census blocks receive a portion of frozen support for the immediate future. After the competitive bidding process, Census blocks not awarded to a carrier should continue to get frozen support, the PSC said. The state commission encouraged its federal counterpart to require the continuation of ETC voice obligations.

The FCC has given itself 90 more days to review a USTelecom forbearance petition seeking regulatory relief the ILEC group says would promote next-generation networks, the Wireline Bureau said in a Friday order in docket 14-192. The new due date for deciding the petition is Jan. 4, the bureau said in exercising the agency's discretion to extend forbearance deadlines one time. USTelecom describes the relief it wants from Communications Act and FCC rules as "addressing section 271/272 and equal access obligations, rule 64.1903 structural separation requirements, the requirement to provide a 64 kbps voice channel where a copper loop has been retired, section 214(c) obligations where a price cap carrier does not receive high cost universal service support, Computer Inquiry rules, the requirement to provide access to newly deployed entrance conduit at regulated rates, and the prohibition against using contract tariffs for business data services in all regions," the bureau said. Granite Telecom, a CLEC, opposed USTelecom's proposed relief from Section 271 Bell long-distance entry duties and the 64 kbps requirement. Granite said it needs those provisions to gain Bell wholesale access to provide voice service to retail business customers. "Absent the § 271 and the 64 Kbps requirements, the [Bells] would have the incentives and ability to re-monopolize the portion of the business market served by Granite and other competitive carriers," the CLEC said in a filing posted Wednesday. "The [Bells] could accomplish this by imposing substantial wholesale price increase[s] or by simply refusing to renew current wholesale agreements."

USTelecom disputed CLEC assertions that the FCC has broad latitude to reimpose regulation on ILEC special-access business services (see 1509100050). A recent letter from Birch Communications, BT Americas and Level 3 "distorts the scope of the agency's discretion, which is constrained by the Communications Act, the Administrative Procedure Act, and the Commission's own decisions, and mischaracterizes the level of deference that courts typically afford agencies under Chevron," USTelecom said in a filing posted Friday in docket 05-25. The CLECs seek reregulation "of enterprise broadband services such as Ethernet and increased regulation of ILEC special access" services given pricing flexibility some time ago, USTelecom said. The commission "cannot upend forbearance and other deregulatory decisions with little or no data analysis" and must address ILEC deregulatory "reliance interests" built up over the years, the ILEC trade group said. "The FCC cannot step in and set prices without a fact-specific, full and fair analysis of the competitive landscape," USTelecom said. "Nor would the FCC be entitled to deference from the courts if it takes the procedural shortcuts suggested [by CLECs]." USTelecom said that the record doesn't support the CLEC relief, and it added: "The Joint CLEC Letter, at bottom, suggests that the FCC can aim low, that close enough for government work will survive court review. But the standard is higher, and the FCC must take into account the full record in the special access proceeding, including the data collection to the extent that it is sufficient and reliable. It must also take into account more recent information that further demonstrates robust competition in the marketplace." Separately, TDS Telecom said its CLEC subsidiaries are struggling to deliver retail services to business customers. "These difficulties are due in large part to challenges in obtaining competitive wholesale pricing for last mile access facilities," TDS said in a filing that attached confidential cost data. And TransWorld Network objected to FCC release of its confidential business data subject to a protective order, noting it still had concerns about the specific purposes that parties might have in seeking to review its data.

Former FCC chairmen Reed Hundt and Michael Copps disputed free speech challenges to the net neutrality order (see 1507310042 and 1508070058). “These arguments are unsound as a matter of constitutional principle, and are contrary to common sense and to common understandings that broadband Internet access service providers have long encouraged and benefited from,” said the brief they submitted Monday to the U.S. Court of Appeals for the D.C. Circuit in USTelecom v. FCC, No. 15-1063. “While the very nature of communications regulations makes them likely to generate plausible-sounding 'Free Speech' objections, it has never been the law -- and it cannot be the law -- that the mere provision of facilities over which others’ constitutionally-protected communication occurs is itself 'Free Speech,' making basic common-carrier non-discrimination duties the constitutional equivalent of a government-compelled 'pledge or oath.'” Copps and Hundt said they were encouraged that most industry petitioners “abandoned these mischievous arguments,” but they are taking the speech objections of Alamo Broadband and Daniel Berninger seriously “to prevent them from gaining a foothold.” If accepted, the objections “would imperil the entire project of communications law and Congress’s longstanding and until now unquestioned, power to regulate in this field,” said the brief, which was joined by law professors Nicholas Johnson, a former FCC commissioner, and Susan Crawford, a former technology adviser to President Barack Obama. Also defending the order on First Amendment grounds were Pennsylvania State University Palmer Chair in Telecom Sascha Meinrath, Fordham University law professor Zephyr Teachout and 45,707 Internet users who joined their separate brief. The Internet is an “essential platform,” net neutrality rules “serve fundamental democratic interests” consistent with “two centuries of commitment to open communications platforms,” and “the idea that ISPs would suppress speech and organizing is not speculative,” they said. “The Internet’s vital role as a conduit between government and the people would be irrevocably damaged if this Court accepts some petitioners’ argument that the Net Neutrality rules violate their First Amendment interest in exercising unfettered ‘editorial discretion’ over the Internet content that their customers choose to send or receive.” Other groups also filed briefs Monday (see 1509220052)

Dozens of parties filed briefs supporting the FCC net neutrality order in the U.S. Court of Appeals for the D.C. Circuit, which is reviewing challenges in USTelecom v. FCC, No. 15-1063. Cogent and 24 other intervenors said the FCC order promoted the “virtuous circle of Internet growth and innovation” through an “open Internet platform,” counter to the arguments of telco/cable ISP “gatekeepers” seeking to overturn the order. The intervenors and separate parties that filed amicus briefs Monday defended the rules and reclassification of broadband as a Title II telecom service under the Communications Act. Among the defenders are 29 lawmakers who said (see 1509210058) that the Title II finding was backed by the Telecom Act and deserved deference on any ambiguity. (For more on the arguments of petitioners and supporters, see 1507310042 and 1508070058, and on FCC arguments see 1509150052.)

A group of U.S. lawmakers and other net neutrality advocates defended the FCC’s open Internet and broadband reclassification order, in briefs filed Monday with the U.S. Court of Appeals for the D.C. Circuit (USTelecom v. FCC, No. 15-1063). “The FCC has done precisely what Congress intended the Commission to do -- classify broadband Internet access service according to its best understanding of the technology of the day, and how consumers use that technology,” said Sen. Ed Markey, D-Mass., Rep. Anna Eshoo, D-Calif., and 27 other members of Congress in their brief. “In light of the FCC’s findings -- findings which are amply supported by evidence -- this Court should uphold the FCC’s reasonable reclassification order.” The eight other senators and 19 other House members included House Minority Leader Nancy Pelosi, D.-Calif., and 24 other Democrats, plus two independents: Sens. Bernie Sanders of Vermont and Angus King Jr. of Maine.

Former FCC Chairman Reed Hundt and others plan to back the agency's net neutrality order in court. Hundt will be joined by other former commissioners and current communications scholars in defending the commission's order on First Amendment grounds, said a notice submitted Wednesday of their intent to file an amicus brief in the U.S. Court of Appeals for the D.C. Circuit, which is reviewing the case (USTelecom v. FCC, No. 15-1063). The notice said the brief would respond to arguments raised by certain petitioners and other amici that the FCC violated free-speech rights in its order, which also reclassified broadband as a telecom service under Title II of the Communications Act. It also said their brief wouldn't likely be duplicated by other amicus briefs.