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FCC Rumbles on the Rules

Light Reading
News Analysis
Light Reading
8/22/2003

The Federal Communications Commission (FCC) has at long last released the final version of its Triennial Review, and that has upset the apple cart big time among the commissioners. Michael J. Copps is positively fuming over it, while chairman Michael Powell accuses the 576-page document of "flouting the law" (see FCC's Copps Slams Triennial Ruling).

As expected, the ruling preserves UNE-P for the traditional voice network, which requires incumbent carriers to allow competitors access to key network elements at low prices, but, where new broadband deployments are concerned, carriers have no obligation whatsoever to share these facilities (see Qwest Comments on FCC Review, Sprint Talks to FCC Review).

"There are some important achievements in this order that have long been objectives of mine — namely, substantial broadband relief. Yet, regrettably, there are some fateful decisions as well that I believe represent poor policy and which flout the law," said Powell, in a statement issued yesterday. [Ed. note: Great time to be a lawyer!]

He's not alone in his dissent.

"This decision plays fast and loose with the country’s broadband future," says Commissioner Copps: "Make no mistake about it, today’s decision chokes off competition in broadband. Consumers, innovation, entrepreneurs and the Internet itself are going to suffer." He adds, "This is not a brave new world of broadband, but simply the old system of local monopoly dressed up in a digital cloak."

It can't be much fun over at the FCC today, as the behind-the-scenes controversy between the five FCC commissioners must surely be reaching a crisis point. Commissioner Kevin Martin and chairman Powell disagreed strongly over UNE-P: Powell backed the RBOCs that stand against it, while Martin voted to keep it. Martin is also pro-investment in new facilities, so both key decisions went his way (see Powell Loses FCC Vote, FCC's Martin: Ruling 'Balanced').

Will this be the final straw that leads Powell to resign? (See FCC's Powell to Resign... Someday.)

Standing by the Commission’s decision is the Telecommunications Industry Association (TIA). "The FCC got it right in deregulating new, last-mile broadband facilities on a national basis," says president Matthew J. Flanigan. "The commission has taken a major step to remove serious economic disincentives to nationwide investment in telecommunications networks... Over time, ILECs are likely to increase their commitment to invest capital to more effectively compete with cable modem providers," he says.

Some industry watchers say there’s no guarantee this will happen, as the ILECs are in no rush to spend money right now. "The incumbents could take ten years to build out these broadband networks given the current economy, and in the meantime the nation's smaller carriers, who cannot afford to build these networks on their own, with wither away," says telecom lawyer and consultant Kristopher E. Twomey. The litigation swamp likely to result from this ruling will also hold up innovation, he adds.

The individual statements by FCC board members can be read here. And in case you've got nothing better to do this weekend (or for the next month), the full text of the review can be found here.

Happy reading!

— Jo Maitland, Senior Editor, Boardwatch

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OSPGuy
OSPGuy
12/4/2012 | 11:31:28 PM
re: FCC Rumbles on the Rules
Commissioner Martin must own a lot of stock in the cable companies.

rjmcmahon
rjmcmahon
12/4/2012 | 11:31:24 PM
re: FCC Rumbles on the Rules
Commissioner Martin must own a lot of stock in the cable companies.

Commissioner Martin is motivated by political power. He actions suggest he believes the appeasement of the phone companies, and their desire for monopoly control over our communications infrastructure, gives him more political capital. It reveals the naivety of his youth. He's behaving like a union leader and not a president.

For the of the public, it's about the economy or about healthcare. Overtaxing citizens, using proxy agents like the RBOCs, does not trickle down to productive economic activity nor does it alleviate the healthcare service shortages faced by our society.
Y2KickIT
Y2KickIT
12/4/2012 | 11:30:00 PM
re: FCC Rumbles on the Rules
The problem with the FCC and the rest of Washington is the frozen belief that the ILECs are a natural entity. They are not, they are an artifice of law and history. They are also holding back the U.S. economy.

Divestiture II, a separation of the local loop and central office system has been proposed before. This would be shared infrastructure like roads.

ILECs would be service providers with the CLECs over the common local loop. Barrier to entry would be lowered and direct competition would commence on price, product, and service.

That would be economic stimulus, how about spending a hundred billion here at home to do this? If we have to go into debt can't we spend it on our own infrastructure where there will be an immediate return on investment?

If we don't, with what will we pay off the debts we incur elsewhere?
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