State Regulators Generally Oppose AT&T’s Deregulatory Test Bed Proposal

Any support for AT&T’s proposal is marked by fragility, the National Association of State Utility Consumer Advocates said (http://bit.ly/Yt7rNT). Of the 83 comments filed in response to the proposal, 26 oppose it outright and 14 focus on preliminary matters that must be addressed before any proposed trials, it said. The groups which support AT&T largely focus in their comments on the need for broadband and IP services, but fail to address “the irreparable harm” the petition would cause to the public, as well as “AT&T’s long history of broken promises,” NASUCA said. Moreover, commenters’ focus on the details of AT&T’s petition was “futile,” because AT&T’s position seems to be a “moving target” that has “substantially” shifted from what was originally asked, the association said.

AT&T’s claim that every dollar spent on the TDM network is “stranded in obsolete facilities” is “a false and misleading claim,” the Michigan PSC said (http://bit.ly/WeR5Md). The TDM and IP networks are “heavily intertwined,” and in fact AT&T’s U-verse relies on the same transmission facilities used to provide AT&T’s TDM service, the PSC said. Because many millions of consumers remain on TDM-based networks, the IP transition and related revisions to federal and state policies “cannot, and should not, be attempted in quick and blanketed fashion,” the PSC said. AT&T failed to provide any statutory basis for preemption of state carrier-of-last-resort and public safety obligations, the PSC said, arguing against dismissal of such requirements.

Sprint said the proposal would “eliminate the pro-competitive aspects” of the 1996 Telecom Act, “including the statutory obligation to interconnect” (http://bit.ly/XBO43N). The request for “trial runs” appears to be no more than a request for deregulation, but the interconnection obligations in sections 251 and 252 are technology-neutral and should apply regardless of technology, Sprint said. Eliminating statutory interconnection obligations would “undermine the fundamental premise of the PSTN” and cripple competition in the voice market, Sprint said. “Perhaps the single most interesting fact to emerge from the comments filed in this proceeding is how few, if any, competitive carriers have a peer-to-peer voice IP interconnection agreement with an RBOC, and how AT&T in particular has refused to negotiate with competitive carriers requesting such peer-to-peer agreements pursuant to Section 251."

But not every state commission opposed AT&T’s petition. The Public Service Commission of Wisconsin supported the trials, “provided they are carefully crafted” to “address concerns” about consumers, competition and universal service, it said (http://bit.ly/YSITO9). Several small ILECs in the state have already converted to an all-IP infrastructure, and the PSC has learned that “the services provided to retail customers are largely independent of the underlying technology,” it said. “Customers are not buying TDM or IP; they are buying the ability to communicate.” Any trial should explain to retail customers why new devices may be necessary, and ensure seamless interconnection with other ILECs and competitors, the PSC said. “Providers have every incentive to ensure that traffic continues to flow,” but “coordinated action will be needed to identify and resolve all incompatibilities in a timely manner,” it said. The commission may need to intervene to ensure that AT&T negotiates “a fair sharing of the costs and inconveniences” if its changes impact CLECs and their customers, the PSC said.

Intel said it supports “reviewing Commission policies that may unnecessarily impede private sector investment in broadband facilities” (http://bit.ly/V2k9Fo). AT&T’s wire center trials are an “incremental and prudent means” to evaluate the impact of existing regulation on the nation’s broadband infrastructure, Intel said. The Internet Innovation Alliance said the proposed trials “epitomize sound policy-making and will provide an open and transparent process in which the FCC can accelerate the transition to all-IP networks and services in America.” No commenter has demonstrated that ILECs have market power and are dominant in the voice services market, IIA said (http://bit.ly/XxqKY8). “Policy makers should address the market that is, not the myth that was.”