FCC TARGETS MID-DEC. FOR START OF UNE REVIEW
FCC plans in mid-Dec. to kick off its triennial review of unbundled network element (UNE) regime, FCC Common Carrier Bureau Chief Dorothy Attwood said Thurs. at ALTS conference in Crystal City, Va. Shed said agency would begin “comprehensive” proceeding that would look beyond basic issue of which UNEs should be on list. For example, she said, notice would ask whether distinctions could be made by geographic areas or type of service when FCC determined what UNEs had to be made available. She encouraged parties to give more constructive input, saying they could best benefit FCC by offering data on where UNEs now were deployed and how they were used. Attwood said agency already was well versed in standard industry debate and would rather hear “lessons learned.” Michelle Carey, chief of Common Carrier Bureau’s Policy & Program Planning Div., said agency “has seen a lot of rhetoric, a lot of ‘he said, she said'” and now would like “hard data.”
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Appearing on panel looking at “Future of UNEs,” Attwood said triennial review would focus on 2 things: (1) How UNEs are provided. (2) Which elements should be included on UNE list, meaning which ones would have to be shared with competitors. It won’t address pricing, she said, because that’s considered different issue. “The Commission can learn a lot from the business cases you present to us,” she told group. Asked what would happen if elements were taken off list, Attwood said inquiry would ask what length of transition period should take place. “Nothing would be flash-cut,” she said. Inquiry will ask what transition period would be appropriate “if, after consideration, elements or pieces of elements or elements in certain markets were found to no longer meet the impairment standard,” she said.
WorldCom Vp Donna Sorgi cautioned, however, that length of transition could have significant impact on CLEC’s business plan. Sunsetting certain elements used by competitor could be “death for a business plan if everyone [including potential investors] knows that access to these elements will end” soon, she said. On other hand, BellSouth Vp Robert Blau warned that calls by CLECs for adding UNEs or reducing prices “won’t work” in stimulating more investment. As long as competitors rely on UNEs, “Wall St. will have a tough time putting more capital into your business.” He said Wall St. would see use of UNEs as “dragging out the inevitable shakeout that going to occur” among competitors because there wasn’t enough revenue to support them all. Sorgi replied later that, while some CLECs had “flawed business plans,” one reason “so many CLECs died is they got a big assist from the Bell companies.”
Attwood said “no one disputes” those complaints but she urged audience to listen to call by Blau for ILECs and CLECs to try to work together to resolve disputes over UNE provisioning before they escalated to FCC or state regulators. When audience of competitive business people groaned, Attwood said that wasn’t bad idea because ILECs knew they couldn’t throw out their statutory requirements so they appeared to be willing to cooperate more. “I think it’s in the interests of incumbents to be an efficient wholesaler,” she said. Blau said ILECs made money from wholesale services they provided to CLECs so they had incentive to settle disputes privately. Disputes over UNEs might be “less contentious if worked out by carriers themselves,” Blau said. “I don’t expect you to believe this but if the FCC and the state commissions let wholesale rates alone, if the market was allowed to flow, we'd all be better off,” he said.
John Heitmann, attorney with Kelley, Drye & Warren, which represents CLECs, urged competitors to “fight for your statutory rights,” warning that ILECs were trying to limit number of UNEs they had to share as well as access to EELs. Triennial review could be “tough fight,” he said. Warned Sorgi: “The future is in doubt. We're in a crisis period.” Evidence of Bells’ “war on UNEs” is evident in comments recently by Verizon executives calling for fewer UNEs and more facilities-based service in wake of Sept. 11 attacks, she said. “It is incumbent on us to fight with facts, to convince the FCC to what it takes to open the local market,” she said.