FCC’s Network-Sharing Ruling Gets Mixed Reviews

WASHINGTON, D.C.-The FCC last week adopted new rules about what parts of incumbent telephone carrier networks must be shared with competitors, backtracking on an earlier decision that force incumbents to share local switching facilities in the residential market.

The new regulations, an attempt to respond to a March decision by the U.S. Court of Appeals for the D.C. Circuit that overturned parts of the FCC’s Unbundled Network Element (UNE) rules, were criticized by AT&T, which competes with the incumbents in some residential markets. AT&T says the decision to no longer require the incumbent carriers to share mass-market switching facilities at discounted rates “fails to secure access to monopoly facilities essential to competition.”

AT&T also objects to the FCC’s decision to limit the sharing of some high-capacity DS-1 and DS-3 network loops in the business market.

Last week’s order, on a 3-2 FCC vote, revises the FCC’s February 2003 triennial review decision on where competitors of large incumbent telephone carriers – the regional Bells – are significantly impaired. Competitive local exchange carriers (CLEC) have access to fewer pieces of the Bells’ networks with the decision.

The UNE rules were designed to foster competition and force the four large regional Bells to share parts of their networks they inherited after the government-forced breakup of the original AT&T monopoly in the early 1980s. Last week’s decision lets the UNE rules continue where competitors have “no other viable way to compete,” and it complies with the appeals court ruling, says FCC Chairman Michael Powell, who opposed much of the 2003 order.

Last week’s action will drive CLECs to invest in their own facilities, Powell says.”This item decidedly does not attempt to make all sides happy;’ he says.”Consequently one will undoubtedly hear the tortured handwringing by incumbents that they are wrongly being forced to subsidize their competitors. Conversely one can expect to hear dire predictions of competition’s demise from those who wanted more from this item. Time will show this will not be so.”

BellSouth, Verizon and SBC praised the FCC’s switching decision, but objected to its decision on DS-1 and DS-3 loops.

Copyright Network World Inc. Dec 20, 2004