FCC Said To Be Eyeing Special Access Actions in April or May
The FCC is considering acting in its special access proceedings in April or May, informed sources told us Monday. The commission is looking at issuing a Further NPRM in its broad review and an order on its incumbent telco tariff investigation in the next couple of months, an industry official said. The FCC's goal is to act in April but that’s not nailed down, said another informed source, who agreed the agency might combine an FNPRM with action on the tariff probe. The commission is reviewing its special access framework in an industrywide rulemaking and is investigating ILEC tariff terms and conditions that critics allege include anti-competitive “lock-up” provisions, which incumbents dispute.
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And Harold Feld, Public Knowledge senior vice president, said he had heard speculation about potential FCC special action in April or May for some time. “It would certainly make sense, given the push to get this done before things start to slow up in advance of the election,” he emailed us. “If it slid to June, I wouldn't be shocked. But I expect it sooner rather than later. This has been dragging on for years, and everyone wants it done.” The FCC didn't comment Monday.
Incompas was among industry parties that continued to lobby the FCC. The CLEC/competitor group said the record clearly showed the special access market “is broken” and large ILECs are charging “supracompetitive prices for both packet-based (e.g., Ethernet) and TDM special access services,” and engaging in “price squeezes” by charging wholesale purchasers rates that are higher than they offer for retail service. It urged the commission to “act quickly to find” the ILECs “possess market power in the special access marketplace, and to adopt remedies to ensure just and reasonable rates for both TDM and Ethernet special access services,” said a filing from the group Friday in docket 05-25 on a meeting with FCC officials, including General Counsel Jonathan Sallet and Wireline Bureau Chief Matt DelNero.
If the FCC needs more time to devise a “comprehensive” mechanism to curb ILEC rates, Incompas said, it should at least “immediately make market findings and implement interim measures,” and address the “egregious terms and conditions at issue in the tariff investigation.” The group said the FCC should ensure the rates for TDM and packet-based services don’t increase and that ILEC wholesale rates are lower than the lowest rates for the same capacity, “at least by avoided costs.” Incompas also said the FCC has clear authority to address ethernet services, something Bells have disputed.
Level 3 urged immediate action on “the most egregiously harmful provisions of the special access volume and term plans” being investigated. “The Commission can do this while still retaining the discretion to address other aspects of the lock-up plans in the future and without prejudging any of the issues in the rulemaking proceeding,” the company said in a filing on a meeting with Wireline Bureau staffers. “The Commission should require that customers purchasing special access services under the lock-up plans have the ability to choose the size of the volume commitments they make under the plans. This would mean that provisions in the lock-up plans under which a customer must set its volume commitment as a percentage of its past purchases would be unlawful."
“In contrast, the volume provisions under which a customer chooses its volume commitment (e.g., as in the AT&T ACP) would be lawful,” Level 3 said. “Incumbent LECs would be permitted to establish different discount levels for different volume commitments under a plan as long as the customer is free to choose the level of its volume commitment (as is the case under the Verizon TVPs) and the discounts offered bear a reasonable relationship to the cost savings experienced by the incumbent LEC as a result of selling the volumes at issue. Finally, given that the effectiveness of this reform could be undermined if incumbent LECs impose unreasonably long terms on plan customers, the Commission should not allow incumbent LECs to set the term of a volume commitment longer than two years (as is currently available under the AT&T ACP, for example)."
CenturyLink said its special access plans that are under investigation “are pro-competitive, lawful and often similar to those in CLEC agreements,” saying the FCC shouldn’t be concerned about them due to rapid migration to non-ILEC ethernet services. “At the time the plans were established, they were geographically limited to the legacy ILEC companies (Qwest and Embarq) footprint and continue to be,” it said in a filing on a meeting with DelNero and other Wireline Bureau officials. “Despite claims of being ‘locked up’ by these plans, most CLECs complaining about these plans have migrated to other providers or newer CenturyLink discount plans.”