Broad group of wireless, GPS, satellite radio and air transport interests urged FCC not to take final action on operation of ultra wideband (UWB) equipment under Part 15 rules without issuing further notice of proposed rulemaking (NPRM). In letter sent late Tues. to Chmn. Powell, 26 companies and trade groups stressed it would be “premature and inappropriate for the Commission to adopt any final rules at this time.” Agency issued NPRM on UWB operations last May (CD May 11 p1), but it didn’t contain specific regulatory language, group said. Since then, FCC has received large volume of test results on potential interference of UWB operations in both GPS and non-GPS bands. “However, the interested parties cannot logically extrapolate from the various test submissions any comprehensive picture of the direction of the Commission’s final thinking with respect to a potential regulatory framework,” group said in letter obtained by Communications Daily. Companies signing letter include AT&T Wireless, Lockheed Martin, Nortel, Qualcomm, Satellite Industry Assn., U.S. GPS Industry Council, WorldCom.
U.S. Dist. Court, L.A., denied class action certification in antitrust suit against 13 cable operators by 2 customers. Suit alleges that subscribers to cable high-speed data services must buy content services of affiliated ISPs at artificially inflated prices. Arguing that exclusivity agreements between MSOs and Excite@Home and Road Runner forced cable companies to impose condition on customers, plaintiffs sought unspecified damages and injunctive relief that would have imposed open access obligations on cable operators. Court’s denial of class certification was without prejudice, so plaintiffs could file amended compliant. In suit, Arthur Simon and John Galley said exclusivity agreements were contracts, combinations or conspiracies in restraint of trade, and bundling of transmission services with interface/content services constituted illegal tying arrangements in violation of Sherman Antitrust Act. As result of “illegal” tie, cable modem subscribers have been forced to pay “supracompetitive” prices and/or pay for unwanted service, they said. AT&T, Adelphia, Cablevision, Comcast, Cox, MediaOne and Time Warner head list of MSOs cited. Plaintiffs said issues that lent themselves to classwide action were: (1) Whether bundle of high-speed Internet transport and content services was one or 2 services. (2) Whether cable operators actually coerced customers to accept tie between 2. (3) Whether cable companies had market power. They said “injury in fact” could be proved on classwide basis. Cable companies said principal arguments in case related to market power. which varied greatly by region, precluding common proof. They also contended that variations in prices and terms argued against common proof of “injury of fact.” In denying class action certification, court said relevant geographic market was local cable franchise area because, in analyzing legality of tying arrangement, focus was on deal between seller and buyer rather than contract between sellers of tying and tied product. Competition in these markets clearly was relevant to whether cable companies had requisite market power to restrain trade and force their purchasers to buy unwanted product, court said. Court agreed with defendants that to prove injury, plaintiffs must produce evidence that prices would have been lower without tie. It ruled that common questions didn’t predominate for class action certification.
While countries such as Japan and Mexico are starting to remove obstacles to competition, serious problems persist, telecom companies and equipment makers told U.S. Trade Representative’s (USTR) office. USTR sought comments in Jan. as part of annual review on effectiveness of U.S. trade agreements involving telecom products and services, including World Trade Organization’s (WTO) basic telecom agreement. Commenters also pointed frequently to competition hurdles in European Union (EU) member states, urging U.S. in some cases to seek stricter implementation of existing EU directives. Concerns raised by telecom companies, which in part centered on interconnection rates, provide road map of lingering telecom market-opening issues that would face USTR under Bush nominee Robert Zoellick.
U.S. Appeals Court, D.C., ruling Tues. that rejected SBC’s advanced services subsidiary (CD Jan 10 p1) appeared to have raised more questions than it answered. Observers questioned Wed. whether decision might pressure Congress to revise Telecom Act to account for advanced services, how ruling would affect similar arrangement at Verizon and how it might play out under new Republican FCC. Court overturned trade-off FCC made with SBC: FCC allowed SBC to provide advanced services free of interconnection requirements if company formed separate affiliate to provide those services. In response to appeal filed by Assn. of Communications Enterprises (ASCENT), court ruled FCC didn’t have authority to forgo interconnection requirements of Sec. 251(c) just because SBC was providing advanced, rather than basic, services and using separate subsidiary. ASCENT represents competitive carriers, particularly those that resale ILEC service.