AT&T told Pa. PUC that it would cost Verizon only $41 million to implement full structural separation of its retail and wholesale business operations and asked agency to hold hearings to review its evidence supporting claim. AT&T said study it commissioned by economist Lee Selwyn reviewed operating cost data Verizon supplied in other PUC cases to come up with $41 million figure. Verizon had said structural separation would cost $1 billion to implement. PUC was expected to decide on separation plan by end of March, but AT&T urged it to admit study findings into record “to assist you [PUC] in reaching conclusions regarding the appropriate implementation plan for structural separation.” Verizon urged agency to dismiss AT&T’s “unverifiable, eleventh- hour, duct-tape study.” Verizon said AT&T in other proceedings testified its own local service startup costs would run to hundreds of millions of dollars, so AT&T’s claim that Verizon could do equivalent creation of new business unit for mere $41 million “defies common sense.”

Backtracking on earlier proposal to give Lockheed Martin no- bid contract to overhaul U.S. air traffic control computer system using GPS technology (CD Feb 2 p2), FAA said it would consider bids from other companies. Agency spokesman said that so far, Raytheon was only other company to express interest. Raytheon has until March 21 to submit formal bid, FAA said. Its officials weren’t available to comment. Industry observers said it was unusual for federal govt. to award contract without competitive bid process. FAA official said contract was worth several hundred millions of dollars. Transportation Secy. Norman Mineta and Deputy. Secy-designate Michael Jackson are former Lockheed Martin executives.

NTIA released test results Fri. analyzing potential impact of ultra-wideband (UWB) devices in GPS bands, raising questions about potential scenarios in which UWB would be used for high-data rate applications in that spectrum. Test results, in highly technical 150-page report submitted to FCC, appeared to raise fewer concerns about applications of UWB at lower pulse rates, such as ground- penetrating radar. Fantasma Networks, which is developing UWB devices for non-GPS bands, said report raised “open-ended questions” on UWB in GPS bands and FCC should move ahead and authorize operation above 2 GHz while GPS concerns were being addressed. Another UWB developer, Time Domain, said it was heartened by apparent NTIA conclusions that in certain scenarios UWB pulses have same impact as Part 15 unlicensed devices. NTIA study sets stage for FCC decision later this year, with more data placed before agency on this issue “than there is in all but a few FCC proceedings,” said Jeff Ross, Time Domain vp-corporate development & strategy.

N.C. Utilities Commission (NCUC) will take comments April 18 and replies May 9 on proposed rules to supplement FCC’s prohibitions against slamming and cramming. NCUC last year signed on to become enforcement agent for FCC’s slamming rules after realizing state had no law or rule explicitly banning slamming or cramming. NCUC in Doc. P-100, Subsec. 148 said penalties prescribed by FCC rules were too small to have deterrent effect on repeat slammers who viewed such penalties as cost of business. Proposed rule for both local and interexchange services would allow NCUC to impose penalties beyond those of FCC, including additional compensatory refunds on intrastate calls, and fine of $1,000 per slammed customer for each day unauthorized service was available. Rule would place burden of proof on new carrier to show switch was authorized. It also would require carrier to provide, on request, letter spelling out rates, terms and conditions of service offer before it made switch. Cramming ban would apply to any unauthorized service added to phone bill, including nontelecom services, with fine of $1,000 for each day unauthorized service was made available to customer. Proposed rule also would require specific consumer disclosures be made in any advertising, direct mail or telemarketing solicitation. NCUC said 37 states ban slamming by law and 7 by commission rule.

Changes at NextNet Wireless: CEO Ralph Muse resign, Chmn. Joseph Costello adds interim CEO to title… Paul Nash, ex-staff of Sen. Johnson (D-S.D.), named dir.-federal affairs, Verizon Wireless… Changes at World Access: Walter Burmeister adds COO to pres.; Patrick Aelvoet promoted to pres., World Access Europe… Christopher Feola advanced to vp-technology, Belo Interactive… Todd Hanks, ex-Juntunen Mobile Television, becomes vp-production & satellite services, Conus… Peter Belman, ex- StarRemote Wireless, named vp-mktg. and product management, Motient… David Maney, Open Access Broadband Networks, named to VSYS board.

N.M. Public Regulation Commission (PRC) adopted price cap regulation plan for Qwest, putting end to rate-of-return regime for state’s largest incumbent telco. PRC made some changes in Qwest proposal, and company has 2 weeks to accept modifications. Agency agreed to Qwest proposal to invest $788 million in N.M. network over 5 years, but included requirements to ensure that rural areas would benefit immediately from network investments. Plan freezes basic business rates through 2005. Qwest will be allowed 15% residential rate boost in 2002 and another 10% in 2003 if it meets network investment schedule and plan’s service quality standards. Other noncompetitive services are capped at average of rates in Qwest region, and competitive service rates are deregulated. If Qwest fails standards, it would forfeit residential rate increases and incur penalties. Rate increases aren’t automatic. PRC said any party could challenge whether Qwest had met requirements for increases. Agency also required that intrastate toll be cut to 8 cents per min. from 12 cents and elimination of rural zone charges for 120,000 customers. Plan gives Qwest 18 months to eliminate all service order backlogs and requires it to make digital subscriber line services available in Alamogordo, Farmington, Gallup, Roswell, Taos.

Sen. Brownback (R-Kan.) intends to unveil more sweeping broadband deregulation bill than one introduced last year, but spokesman said office wasn’t ready to reveal details. Spokesman also said Brownback, although last year supportive of Sen. Rockefeller (D-W.Va.) broadband bill (S 88), said this year he didn’t intend to renew support for reintroduced Rockefeller bill, hence recent withdrawal from list of S-88 co-sponsors, to which he had been added inadvertently. Meanwhile, Rockefeller’s office may attach S-88, which now has 51 co-sponsors, to vehicle in Finance Committee, possibly to suitable tax package that may emerge. Bill won’t be used to amend Bush Administration’s tax package that’s geared toward individual tax cuts. In letter late last week to OPASTCO, Brownback said S-88 “at first glance seems appealing, but in reality provides few assurances of successfully increasing rural broadband deployment.” He said Rockefeller bill was “more likely to serve as a subsidy for plant manufacturers and large telecom companies”

FCC could make decision as soon as this month to allow dominant carriers such as Bell companies to bundle their basic phone service with customer-premises equipment (CPE) and enhanced services, industry sources said. CPE restrictions have been on books since early 1980s. FCC detariffed and deregulated CPE but said carriers had to offer it separately from their phone services, meaning they couldn’t offer bundled package to consumers that included CPE and telecom service. Situation is somewhat unclear on whether phone companies can offer enhanced services such as e-mail as part of telecom service packages so FCC action would provide clarity. Commission in Oct. 1998 proposed lifting restrictions only for nondominant carriers but discussion since has expanded to possibility of including dominant Bells. In Feb. 27 ex parte letter to FCC, WorldCom said if agency allowed Bells to bundle services and equipment it should require them to still offer basic phone services on standalone basis as well. Otherwise, WorldCom said, Bells will be able to “mask discrimination in the rates it charges competitive service providers for services and facilities over which it maintains a monopoly.” “Since there are no alternatives to their basic services, dominant carriers must be required to make their basic telecommunications services separately available on nondiscriminatory terms,” it said. Commercial Internet eXchange Assn. urged FCC in earlier ex parte letter to “clearly articulate its intentions with regard to the application of regulations and legal doctrine that apply to bundling, to minimize the potential for uncertainty.” ISPs already are having difficulty securing telecom services, particularly DSL, from ILECs “at reasonable rates and on nondiscriminatory terms,” group said.

Verizon told R.I. PUC that it was halting project for 3rd party testing of its operation support systems (OSS) effective immediately. Company said Wed. it stopped testing program to “reassess its allocation of resources” for OSS testing project in R.I. Move follows PUC order denying Verizon’s request to narrow scope of OSS testing as it approved master plan for KPMG’s test. Verizon proposed eliminating certain tests on performance-metrics validation, maintenance and repair, and billing function. It contended FCC in its order granting Sec. 271 approval to SBC in Kan. and Okla. had established principle that repeat testing of OSS functions that passed muster in one state wasn’t needed for subsequent states using same system. PUC said SBC situation was different in that SBC already had Sec 271 long distance approval in “anchor” state of Tex., unlike Verizon in New England whose anchor state of Mass. still is pending. PUC said OSS functions Verizon wanted to remove from test program were vital to development of local competition, so state-specific testing was justified.