BellSouth’s request for a change in how carriers pay for local number portability and thousands-block number pooling makes a lot of sense, USTelecom said in comments filed Thurs. BellSouth sought a rulemaking to replace today’s system, in which carriers pay shared costs based on revenue. USTelecom said BellSouth argued “persuasively” that market changes justify funding system revisions. “The current allocation mechanism requires certain carriers to pay for costs that they do not cause,” USTelecom said: “In BellSouth’s case, for example, while the percentage of transactions that it has generated over the last three years has declined, its allocated portion of the shared LNP and pooling costs over the same period has more than quadrupled.”

Lobbying spending among telecom, cable and broadcast groups increased about 9% in the first half of 2005 compared with the same period in 2004, according to mid- year reports filed with the Secy. of the Senate. The reports examined for this article include only the internal spending reported by trade associations and companies. Most companies and trade associations supplement their internal resources with outside lobbying groups and law firms that have special expertise in topic areas for contracts ranging from $10,000 to $250,000 per filing period, which is 6 months.

Level 3 Communications opposed USTelecom’s petition for an FCC rulemaking to protect ILECs from high pole attachment and conduit rates (CD Dec 7 p7). Level 3, which is a conduit owner, told the FCC that Congress didn’t intend to include ILECs under the provisions of Sec. 224 of the Communications Act guaranteeing access to poles and conduit at prescribed rates. If the FCC agreed to USTelecom’s petition and set limits on what ILECs paid for access to conduit, conduit owners “would have very little incentive to grant access to ILECs” and could refuse to do so because “ILECs have no statutory right to access a utility’s conduit,” Level 3 said. Granting USTelecom’s petition “would actually harm competition,” Level 3 said in reply comments filed Dec. 19. AT&T and other ILECs supported the USTelecom petition. AT&T disputed arguments by electric utilities that ILECs have a significant bargaining position with pole owners so there’s no need for regulatory intervention: “Whenever possible the Commission should rely upon market forces and arms'-length negotiations between commercial entities [but] in rare instances… market forces break down and Commission intervention is required.” AT&T said “the parity that ILECs once enjoyed with electric utilities has long since disappeared and ILECs, as attaching entities, ought to have the same rights as any other carrier to invoke the Commission’s authority to resolve disputes where market forces do not operate effectively.” USTelecom also disputed opposition expressed by electric utilities during the first round of comments, saying the utilities made “weak and unpersuasive arguments.” USTelecom said statutory language doesn’t bar extension of Sec. 224 to ILECs and joint use agreements between electric utilities and ILECs “are irrelevant with respect to the requested rulemaking.”

Surewest board member Steve Oldham takes over as pres.-CEO, effective Jan. 1, replacing Brian Strom, who retires March 31 to become consultant… Liane Pelletier, Alaska Communications, joins USTelecom board… Gemstar-TV Guide promotes Eileen Murphy to senior vp-corporate communications… Susan Polyakova, ex-Communications Daily, becomes Wireless Communications Assn. communications dir. Jan. 3… Paul Karpowicz, Meredith Bcstg., joins NAB TV board… Roger Werner, ex- Speedvision and ESPN, becomes special advisor to Narrowstep… Environmental activist Nancy Ryan named technical advisor to Cal. PUC Comr. Michael Peevey.

T-Mobile endorsed a USTelecom call for a rulemaking to examine pole attachment rules. “Wireless carriers continue to face great difficulties in gaining competitively neutral, non-discriminatory access to utility poles,” the carrier said. “The results are unreasonable delays, or even denial, of wireless services the public wants and needs.” T-Mobile said utility control of utility poles often creates a “bottleneck” for carriers seeking access to residential neighborhoods.

The FCC should extend the separations freeze while opening a rulemaking to consider reforming it, USTelecom said in a white paper filed with the FCC Dec. 12. The June 30 expiration date is causing “significant uncertainty in the industry and forcing carriers to consider making substantial investments” to comply with jurisdictional separations requirements, the white paper said. The FCC also should say “price cap carriers do not have to conduct resource-intensive investment studies” during the freeze, USTelecom said. The separations process differentiates between interstate and intrastate telephone company costs. The FCC froze the current formula while it considered reforming the system to reflect changes in technology.

NTIA Dir. Michael Gallagher will leave the agency early next year, as expected. He had led the agency since shortly after the departure of Nancy Victory in Aug. 2003, though he wasn’t confirmed by the Senate until Nov. 2004. Gallagher is expected to be replaced, at least in an acting capacity, by his deputy John Kneuer, industry sources said.

A bill introduced by Sen. DeMint (R-S.C.) that would give the FCC authority to define what constitutes fair competition for consumers is based largely on ideas from the Progress & Freedom Foundation’s project on telecom reform. The bill, which has no co-sponsors, includes a substantial section on universal service fund (USF) reform -- the first major Senate telecom bill to address the matter. The provisions are based on research by experts PFF convened from universities, law firms and research groups (CD Dec 9 p3). DeMint’s bill would require the FCC to adopt within 6 months after enactment a new contribution mechanism based on phone numbers; place a $3.6 billion cap on distribution, in the form of performance-based block grants to states.

The National Emergency Number Assn. (NENA) raised red flags about a request from wireless reseller TracFone that the FCC potentially lighten the regulatory load placed on it if it’s designated as the first wireless reseller with eligible telecommunications carrier (ETC) status under the USF lifeline program. Public safety sources said Tues. while TracFone is relatively small compared to a few of its peers, the issues raised aren’t, especially if other resellers also apply for ETC status.

The U.S. Appeals Court, D.C., joined 2 other circuits in ruling Fri. that the federal excise tax doesn’t apply to most long distance phone calls. In an opinion written by Judge David Tatel, the court said it was required to decide whether a statute imposing a tax on calls that vary by distance and time applies to long distance calls that vary in time but not distance. The U.S. Dist. Court, D.C., concluded the statute doesn’t cover such charges “and we agree,” Tatel said. “Many customers now pay per-minute charges that remain constant regardless of how far their calls travel,” which doesn’t meet the Internal Revenue Code’s time-and-distance definition, said Tatel. The case, brought by the National Railroad Passenger Corp. (Amtrak), reflects how billing for phone service has changed since 1965, when Congress last amended the phone tax provisions, the court said. However, despite those changes, the court said it doesn’t agree with the IRS that “the tax extends to all future service, however billed.” Tatel wrote: “Because the district’s court’s well-reasoned opinion properly ascertains the statute’s meaning, we affirm the grant of summary judgment to Amtrak. True, this interpretation limits the effectiveness of the tax on long-distance calls, but because [the statute] is unambiguous, the IRS must take its case to Congress, not this court.” USTelecom said this “is the third major strike against the IRS’s misguided insistence on collecting the federal excise tax. It’s time for the IRS to admit defeat and stop enforcing the illegal application of this tax.”