FCC set schedule for comment deadlines for Verizon’s long distance application for N.J. Third party comments are due Jan. 14, replies Feb. 1. N.J. Board of Public Utilities must file written consultation Jan. 14, with evaluation from Justice Dept. due Jan. 28. FCC said Common Carrier Bureau would be available for ex parte meetings Jan. 10-11 and Jan. 30 on application. Statutory deadline by which Commission must act on Sec. 271 filing is March 20.
Congressional inaction on NextWave legislation last week came as other wireless carriers in similar or related straits await final word on fate of their own licenses. Congress left town Thurs. for holiday break without voting on $16 billion settlement legislation, meaning Dec. 31 deadline for Capitol Hill approval of deal’s terms was expected to pass without action. Without blessing by lawmakers by that date, parties to settlement -- which include Justice Dept., FCC, NextWave, Verizon Wireless and others -- may walk away from deal. Some industry observers said negotiators who negotiated deal still might be able to stay together for short time early in 2002 to continue advocating for settlement on Hill, although prospects for that scenario were unclear at week’s end. Attention also is starting to refocus on continued court action, specifically petition for certiorari that FCC filed at U.S. Supreme Court in Oct. seeking review of U.S. Appeals Court, D.C., ruling that overturned agency’s cancellation of NextWave licenses for missed payment. That came as several other carriers still were awaiting resolution of NextWave-related litigation to gain certainty about fate of their own licenses.
American Heart Assn. warned consumers Fri. that “not all cellphones connect callers to 911.” It advised consumers to make sure wireless carrier they were considering had addressed safety concerns before they purchase cellphones. Warning referred to conditional relief from deadline for Enhanced 911 Phase 2 capability granted by FCC to 5 major wireless carriers (CD Oct 9 p1). Relief followed nearly 70 requests for waiver that had piled up at Commission in advance of Oct. 1 deadline. “Most Americans assume that they can use their cellphones in an emergency. Unfortunately many cellphone companies are not properly hooked up to 911 systems,” Assn. spokesman said. Dialing 911 may connect customer with answering service rather than emergency authorities or call may be dropped, he said. Assn. urged consumers to ask wireless provider: (1) Does it provide wireless 911 connection in area. (2) Does it provide enhanced wireless service. Enhanced 911 service, required to provide 911 operator with location information, uses equipment upgrades that carrier may not have made in consumer’s area, it said.
Group of 86 House members urged FCC and Dept. of Justice to “rigorously scrutinize” proposed EchoStar-DirecTV merger, which they said had potential to affect rural consumers negatively. Group led by Rural Congressional Caucus Co-Chmn. Emerson (R-Mo.) and Rep. Clayton (D-N.C.) told FCC Chmn. Powell and Attorney Gen. John Ashcroft in letter Dec. 19 that merger could affect rural residents if it were approved without appropriate consumer protections: “Accordingly, we believe that strictly enforced consumer safeguards regarding price, quality and access to vital telecommunications services must be part of any merger approval between EchoStar and Hughes… Meaningful and enforceable concessions are needed, not empty pledges that provide no protection or value.” Congressional review of proposed consolidation (CD Dec 5 p3) of nation’s largest DBS providers thus far has produced mixed response. While some members say merger is needed for greater competition with cable and to increase broadband capacity, others say it would eliminate competition in that industry segment. Charles Ergen and Eddy Hartenstein, respective chmn. of EchoStar and DirecTV, said in response letter to rural caucus members that merged entity would continue to offer uniform nationwide pricing structure. “This pricing structure extends the benefits of competing with cable companies in rural areas to those who live in the most remote areas.” They said their companies always had counted on “subscribers in rural areas as among our most loyal, and they will continue to be a vibrant part of our future. We believe the merger will enable the company to offer even more benefits to rural consumers than currently available.” They reiterated their position that merger would increase: (1) Efficiencies that allow additional markets to receive local programming. (2) Offerings of HDTV and interactive services. (3) Deployment of high-speed Internet services in rural regions.
Verizon filed application with FCC Thurs. to provide long distance service in N.J., with Senior Vp-Public Policy & External Affairs Thomas Tauke calling Sec. 271 filing company’s strongest to date. “There is absolutely no doubt that we've met or exceeded all the federal requirements for FCC approval,” he said. N.J. is 6th state where Verizon has applied to offer long distance, with application for R.I. still pending at Commission. Timeline at FCC is that agency has 90 days to review Verizon’s application. N.J. Board of Public Utilities (BPU) and U.S. Justice Dept. will provide recommendations to FCC before it renders final decision. Dennis Bone, Verizon Jersey pres., said KPMG Consulting conducted testing on Verizon systems in N.J. for 19 months. “This is the first time in any state that this testing has shown a 100% perfect score,” he told reporters in Thurs. conference call. “The record at the New Jersey board relating to the 14-point checklist is very clean,” Tauke told reporters, stressing that process application had undergone at state level was “very routine.” He faced several questions from reporters about Verizon’s submitting Sec. 271 filing for N.J. at FCC before N.J. BPU had formally voted to approve it. Tauke said process was different in different state PUCs and for Sec. 271 applications such as N.Y., Verizon submitted application at FCC without formal vote from state commission. In states such as N.J., Verizon didn’t make filing at FCC until “we believed that [state] commissioners were sufficiently comfortable with the record to reach a positive conclusion,” Tauke said. “There’s no science to this. We obviously believe that we have reached this sense in the state of N.J.” Verizon officials said that N.J. accounted for nearly 15.5% of lines for former Bell Atlantic region. So far, nearly 54.5% of former Bell Atlantic lines have made it through long distance entry process and N.J. would boost figure above 70%, Tauke said.
In face of lingering questions from FCC, BellSouth (BS) withdrew its Sec. 271 application to provide long distance in Ga. and La. and said Thurs. it planned to resubmit filing with updated information shortly. New filing will provide Commission with additional information on operations support system (OSS) issues such as preordering and order process integration and service order accuracy, BS said. It “will comply with the FCC’s request for additional information to supplement the record,” said Margaret Greene, pres.- regulatory & external affairs, saying company built “solid case” that it had met Telecom Act requirements for long distance entry. FCC Chmn. Powell said: “The FCC cannot approve such applications by the Bell companies unless they satisfy the requirements of Section 271 of the Communications Act.” Competitors praised what they viewed as signal sent by Commission that it was insisting on complete information in long distance filings that OSS systems worked. BS said it planned to resubmit filing “promptly” to restart review process at FCC.
Legislation to impose “mandatory federal regulations” prohibiting TV broadcast of hard liquor ads could be introduced early next year, bipartisan trio of House members said Thurs. House Commerce, Justice & State Appropriations Subcommittee Chmn. Wolf (R-Va.), flanked by subcommittee member Roybal-Allard (D-Cal.) and House Telecom Subcommittee ranking minority member Markey (D-Mass.), denounced NBC for being first national TV network to drop voluntary ban on such ads. Wolf expressed “extreme disappointment” in news conference at Capitol that NBC had abandoned its position as “responsible corporate citizen” for sake of its bottom line.
Consumer groups said Comcast’s proposed $72 billion merger with AT&T Broadband would “place a chokehold” over nation’s access to TV, Internet and other broadband services and warned they would try to persuade federal regulators to block deal between nation’s first and 3rd largest cable operators. Two senators called for hearing early next year, saying they had “serious concerns” and want to explore impact of new AT&T Comcast as well as proposed merger of satellite service providers EchoStar and DirecTV. Sens. Kohl (D-Wis.) and DeWine (R-O.), chmn. and ranking minority member, respectively, on Subcommittee on Antitrust, said they were particularly bothered by rising cable rates. “We continue to believe that more competition, rather than additional consolidation, is needed in this industry,” they said. However, Kohl and DeWine said they also recognized potential benefits, such as introduction of cable telephony to more consumers as viable alternative to local telephone companies.
Nearly 90% of U.S. households will have access to broadband via cable by end of 2002, NCTA said in comments on NTIA broadband inquiry (CD Dec 20 p2). NCTA said it believed 128 kbps was adequate to meet user needs “under most circumstances,” although cable usually offered 4 times that much. Citing cable’s $55 billion investment in broadband, NCTA said “explosive growth” of broadband was “testament to the wisdom of the government’s policy of vigilant restraint.” In other comments, ALTS said best way to promote broadband was to encourage facilities-based competition. “Studies show demand for broadband is still low,” ALTS Pres. John Windhausen said: “There is no benefit to artificially stimulating the availability of broadband to consumers that have little or no interest in subscribing.” ALTS said access to rights-of-way still was problem, and “premature deregulation of the ILECs’ necessary facilities would undermine competition.” However, AT&T said there was evidence that broadband deployment was “lagging” in some areas where market forces were inadequate to promote deployment. It suggested tax incentives, tax credits for employers, opening local exchange market to competition. Qwest said biggest broadband impediments were regulatory, including “asymmetrical regulatory burdens.” It said, for example, that cable modems were largely free from regulation, while ILECs had to unbundle their networks, providing below- cost capacity to competitors. CompTel said govt. should block “anticompetitive practices” of ILECs and no other new laws were needed to spur broadband. “Now that the majority of consumers have access to broadband, policymakers should focus on reviving the spirit of entrepreneurship,” CompTel Pres. Russell Frisby said: “The laws to do just that exist in the [1996 Telecom] Act, they just need to be enforced.” Govt. shouldn’t set single definition of broadband, and should continue to work on broadband mobile services, CTIA said. Major barriers are lack of spectrum and “unnecessary regulatory restrictions,” CTIA said. Among restrictions it wants lifted are spectrum cap and limits on spectrum flexibility. TIA said it was dissatisfied with pace of broadband deployment and suggested package of tax credits, low-interest loans, subsidies, grants, pilot project funding. Deregulation also would spur investment in facilities, TIA said. WorldCom said access by competitors to unbundled network elements at cost was necessary because “competition in the provision of network functions cannot develop rapidly for all network functions, and may not develop at all for other network functions.” Progress & Freedom Foundation largely repeated earlier comments to FCC, saying “uniform deregulatory regime for broadband services” would spur investment. Although satellite industry doesn’t believe there has been market failure in delivery of broadband services to urban America, Satellite Bcstg. & Communications Assn. said some govt. intervention might be necessary to ensure same services are provided in rural and remote areas. Tax credits -- either focused on consumers or service providers -- might be effective way to overcome cost barrier, it said.
FCC granted applications by Lockheed Martin Global Telecommunications (LMGT) and Comsat, together with Telenor Satellite Services Holdings (TSSH), Telenor Satellite and Telenor Broadband Services (Telenor Broadband) to assign Title II common carrier authorizations and Title III radio licenses held by Comsat to Telenor Satellite. Transaction will result in 79% indirect foreign govt. ownership of U.S. licenses, highest level of govt control of U.S. license allowed by Commission in its history, said FCC Comr. Copps, who opposed agreement. Deal is threat not only to competition, but also to public interest, he said: “Such control threatens competition because companies controlled by a foreign government have many increased incentives and enhanced abilities to cross-subsidize their American licensee.” Proposed assignment is in connection with Telenor’s proposed acquisition of Comsat Mobile Communications (CMC). Acquisition involves assignment of various satellite earth station licenses, private land mobile radio licenses, experimental licenses and Sec. 214 authorizations held by Comsat. FCC said proposed assignment of CMC-related FCC licenses and authorizations to Telenor Satellite and operation of CMC’s business by Telenor Satellite Services was in public interest. Transaction doesn’t promise to bring new competitor to satellite services market, Copps said: “One is left to wonder what procompetitive benefits such an agreement confers.” FCC said authorizations and licenses were subject to compliance with Nov. 29 agreement among Telenor, Dept. of Justice, FBI. Agreement is designed to address national security, law enforcement and public safety concerns of DoJ and FBI.