CenturyLink, Others Dispute FCC Proposal for '11 Percent' Legacy BDS Rate Cut
Midsize telcos disputed the FCC's proposed 11 percent rate cut for legacy business data services, with CenturyLink saying the reduction would be unjustified and bigger than the commission projected. "Because the proposal under consideration contemplates that above-tariff contract charges would…
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be reduced to the tariff rates before the 11% reduction takes effect, the total cuts will necessarily be greater than 11% -- and perhaps significantly greater -- with serious consequences for ILECs’ ability to recover costs and continue to invest in rural broadband," said a CenturyLink filing Friday in docket 16-143. The commission's "record clearly establishes the presence of strong BDS competition" and the agency "not only ignores the evidence, but declines to conduct any analysis of the BDS geographic market at all," said a release Monday from the Invest in Broadband for America coalition citing the filing (the coalition includes CenturyLink, Cincinnati Bell, Consolidated Communications, FairPoint Communications and Frontier Communications). FCC Chairman Tom Wheeler is planning a Nov. 17 vote on a BDS item that would subject ILEC legacy DS1 and DS3 services (with data speeds under 45 Mbps) to price-cap rate regulation and cuts, while adopting a lighter-touch approach for packetized Ethernet services (see 1610270054). The "draft BDS proposal would unduly affect mid-size ILECs, like Frontier, in ways that would be deeply harmful to investment in American broadband connectivity and jobs," said a Frontier filing on a meeting with Office of Strategic Planning Chief Paul de Sa. The telco urged the commission to "carefully consider the current state of market competition in how it implements any reform to existing grants of Phase II pricing flexibility, noting the particularly competitive nature of the transport market." The proposed 11 percent reduction "should be pro-rated" for certain ILECs such as Consolidated that haven't been regulated under price caps "for the entire period of efficiency gains the downward adjustment purports to address," said a Consolidated filing on meetings with aides to Wheeler and Commissioner Jessica Rosenworcel, and with Wireline Bureau staffers. CenturyLink is buying Level 3 (see 1610310033).