With release of the FCC’s Triennial Review order on network unbundling policy said to be imminent, state regulators believe they're about to see the fruit of their months of preparation for addressing unbundled network element platforms (UNE-Ps) and the other complex network unbundling issues that the FCC order is referring to the states.

BellSouth officials said Tues. they were concerned that the same legal vulnerabilities that caused the courts to overturn previous FCC UNE decisions were at issue in the pending Triennial UNE Review order. “Our concern here is that the FCC is doing a lot of the same things over again,” BellSouth Gen. Attorney Jonathan Banks said at a media briefing on the upcoming order. BellSouth Vp Herschel Abbott noted the pending order is the FCC’s 3rd attempt to make a decision on unbundled network elements that met judicial scrutiny. “The FCC has not yet issued an order that passed judicial muster with unbundled network elements,” he said. Banks said one of the biggest controversies was the presumption of impairment used for switching. In voting on the order in Feb., the FCC was 3-2 against eliminating switching from the national UNE list, which kept the UNE platform intact and gave state regulators authority to determine whether switching, or any other UNE, should be dropped. The order included a “presumption” that switches serving large businesses no longer had to be unbundled, but it gave states 90 days to rebut that national finding. The provision would include businesses served by high-capacity loops such as DS-1. The order also had a “presumption” that switches used for the mass market should remain unbundled unless states disagreed during a 9-month period. “The FCC appears as if they are going to order us to unbundle these things just presuming impairment but not finding it,” Banks said, and courts previously have held found that unbundling can’t be ordered without a finding of impairment. “If there’s no finding of impairment, ordering unbundling of switching for the mass markets is going to be plainly wrong and inconsistent with the D.C. Circuit and the Supreme Court,” he said. Another closely watched area is how the Commission defines “mass market” in the order, which appears to be taking up a definition different from previous ones, Banks said. Saying the FCC’s majority presumed impairment for the mass market and no impairment for large business, he said the FCC in the past drew the line for a big business at 4 or more lines. Referring to DS-1 level switching facilities, a new line would be drawn at 24 lines, he said. “It’s a far, far higher threshold than the 4-line cutoff that they used to use,” Banks said. “To expand the availability of switching to 4-line customers all the way up to 24-line customers seems to be exactly what the courts have said not to do.” He said the D.C. Circuit seemed to be saying that drawing the line at 4 was in itself too broad, meaning an expansion to 24 lines would create a problem if it were to resurface before the court. Even after the 9-month period in which states decide whether switching should remain a UNE, the order appears to keep intact a 3-year period during which switching would have to be supplied by incumbents at UNE rates, Banks said. He said that would be hard for the Commission to explain to the courts “since there’s no finding of impairment, in fact they've never legally found impairment in switching.” Another closely scrutinized area of the order is how the FCC directs the states to conduct proceedings on switching impairment, Banks said. One question is whether the Commission essentially is turning over impairment decisions to the states or is giving them a tight list that constrains what they do to simply implementing the FCC decision.

BOSTON -- ILECs and IXCs on both sides of the UNE-P debate pitched their respective views to state legislatures Fri. at the National Conference of State Legislatures (NCSL) Spring Conference here. A panel Fri. summarized the new role of state PUCs in using “impairment” criteria from the FCC at the local level in determining whether to keep UNE-P. The predictable messages from AT&T and MCI to keep the UNE-P liberal and by Verizon “to consider local investment” and eliminate the UNE-P were somewhat misdirected in a room filled with state lawmakers, few of whom were likely to have telecom as their top priority.

Next forum on FCC’s broadcast ownership rulemaking will be Fri., March 7, at U. of Washington in Seattle. Comrs. Copps and Adelstein are set to attend hearing, 9 a.m.-1 p.m. at Hub Auditorium at Shidler Center for Law, Commerce & Technology. Organizers said they probably would release agenda late Mon. (after our deadline) or Tues.

FCC adopted complex UNE order Thurs. that appeared to please no one entirely, giving and taking regulations from every part of telecom industry. All of commissioners registered partial dissents except Comr. Martin, who teamed with Comrs. Copps and Adelstein to create majority vote for keeping UNE platform option for competitive entry and strengthening state regulators’ power to determine when individual UNEs should be dropped.

EchoStar completed repurchase of 9-1/4% senior notes Feb. 1, 3 years early, company said (CD Jan 2 p10).

In ruling that could mark end of protracted NextWave litigation, U.S. Supreme Court Mon. upheld lower court decision that reversed FCC on cancellation of carrier’s licenses. Court ruled 8-1, with dissent by Justice Stephen Breyer, that Bankruptcy Code barred FCC from revoking licenses held by bankrupt debtor for failing to make timely payment. Writing for majority, Justice Antonin Scalia said that reading of bankruptcy law didn’t conflict with Communications Act, which he said didn’t require FCC to cancel licenses as penalty for missed payment. “What the petitioners describe as a conflict boils down to nothing more than a policy preference on the FCC’s part,” he wrote.

EchoStar subsidiary EchoStar DBS will redeem outstanding 9-1/4% senior notes from U.S. Bank Trust National Assn. Feb. 1, EchoStar said. Company will be exercising early redemption right for notes due in 2006. It will pay 104.625% for $375 million in notes -- $392 million.

FCC at our deadline Thurs. approved 2 key Bell applications for Sec. 271 authority to enter long distance business: (1) It voted 4-0 to approve BellSouth’s application for Fla. and Tenn., last remaining states in its territory without Sec. 271 authority. (2) It voted 3-1 to approve SBC’s application for Cal., biggest market in country. Comr. Martin dissented on SBC vote. Comr. Adelstein didn’t vote.

T-Mobile finished deploying wireless priority access (WPA) technology Mon. in Washington for National Communications System (NCS), latest phase in broader project to give network-access priority to national security personnel and first responders nationwide. This stage of Capital-area deployment of WPA is significant, but is only beginning of eventual end-to-end national capability that will include Internet priority access, NCS Technology & Programs Div. Chief Peter Fonash said at E-Gov Homeland Security 2002 conference in Washington.