Consumer Federation of America (CFA) and Mass. Consumers Coalition urged FCC Wed. to deny Verizon’s application for Sec. 271 entry in Mass. because rates carrier charged competitors weren’t cost-based and its operations support systems (OSS) were inadequate. In conference call with reporters, CFA Research Dir. Mark Cooper said group was concerned about pricing issue because Verizon was using same rates as were adopted in N.Y. state, rather than undergoing separate cost review by state regulators in Mass. He said OSS concern was similar to that raised by Dept. of Justice -- lack of adequate support for competitors seeking access to DSL lines. Cooper said Mass. application was particularly important because it was first one to be acted upon by new FCC under Chmn. Powell and because it set stage for large number of new applications expected this year. If FCC approves questionable pricing strategy on Mass. application, it could set precedent, Cooper warned. He said CFA supported Verizon’s N.Y. application but plugging N.Y. rates into Mass. application was “legally flawed.” “We would like to reestablish discipline on the part of the Commission,” he said. Wed. was deadline for reply comments on Verizon’s Mass. application. Company urged FCC to approve it, based on fact that competitors had captured more than 16% of phone lines and were gaining 1% every 6 weeks. Verizon has to prove its local network is open to competition before getting long distance authority under Sec. 271. It said level of competition in Mass. was highest yet seen by FCC in any state where Bell company had sought entry. “These numbers clearly demonstrate that the Massachusetts telecommunications market is irreversibly open,” Verizon Senior Vp Thomas Tauke said. Because of concerns about DSL access, Verizon refiled its application Jan. 16 to offer more proof of nondiscriminatory access. Company said there now was more proof because in last 2 months it had met more than 97% of its installation appointments for DSL-capable loops and 96% of them had operated without problems.
Large carriers informed FCC and SEC of details of financial arrangements with designated entities in recent C-block re- auction, including $2.6 billion pledged by AT&T Wireless to Alaska Native Wireless (ANW). Cingular Wireless said it has planned $460 million in loans to designated entity Salmon PCS. FCC released public notice late Tues. (CD Feb 28 p5) on long forms filed by successful bidders in PCS auction that raised $17 billion. Relationships between major carriers and designated entities, which qualified to bid on licenses closed to smaller bidders in auction, have been subject of scrutiny by some smaller carriers.
Top federal telecom policymakers warned state regulators to be cautious as federal govt. and states evaluate telecom policy 5 years after Telecom Act’s passage. In speech to NARUC Winter Committee Meeting in Washington Wed., new FCC Chmn. Powell said state and federal policymakers needed to “focus on new rules for a new network” rather than policies based on “legacy costs.” Senate Communications Subcommittee Chmn. Burns (R-Mont.) said main task facing regulators was “to square the business world with the consumer world,” securing both consumer benefits and business investment opportunities in telecom. House Commerce Committee Chmn. Tauzin (R-La.) cautioned against making politically expedient policies that distorted utility service markets by concealing true costs.
Wireless and broadcasting industries and their regulators were caught offguard Wed. when Bush Administration seemed to propose mysterious multibillion-dollar initiative to hasten broadcasters’ departure from analog spectrum. White House buried section in tables in back of “budget blueprint,” which otherwise didn’t mention FCC or telecom issues even once. By end of day Wed., our sources still were trying to figure out exactly what policy shift was being contemplated. White House and OMB didn’t return calls for explanation. Fuller budget book with line items and explanations isn’t expected until April.
Sen. McCain (R-Ariz.) introduced low-power radio bill (S-404) aimed at reversing “anti-low-power FM [LPFM] radio language” attached to appropriations legislation last year. Bill would: (1) Enable FCC to license LPFM stations and reject licenses only for stations “whose transmissions are actually causing harmful interference to a full-power radio station.” (2) Require FCC by Feb. 23, 2002, to complete all necessary rulemakings implementing full-power stations’ transition to digital broadcasting. (3) Direct FCC to identify stations causing interference and how LPFM stations could resolve interference problems.
Arch Wireless subsidiary AWI Spectrum and Nextel subsidiary ACI filed application for FCC approval to assign 150 licenses in 900 MHz specialized mobile radio service to Nextel from Arch. Agency is seeking comments by March 21, with replies April 2.
Group representing wireless providers criticized Multi-Assn. Group (MAG) plan for reforming rural telephony regulation Mon. but gave slightly more favorable review to another plan proposed by Rural Task Force (RTF). In comments to FCC Mon., Competitive Universal Service Coalition (CUSC) said much of MAG plan failed to “satisfy the access charge and universal service guiding principles of competitive neutrality, economic efficiency and transparency.” CUSC said 2 parts of MAG were consistent with those principles -- proposed increase in subscriber line charges in rural areas and plan to make universal service funding portable. However, most parts of MAG proposal raise “policy pitfalls that the Commission should avoid,” CUSC said. On other hand, it said it “generally supports the RTF recommendations which will advance the goal of competitive neutrality and will prevent excessive growth in the size of the fund.” However, CUSC said some parts of RTF plan should be rejected, such as “safety value” adjustment that would permit increases in amount of funding in some study areas. FCC took comments on 2 plans separately but on same schedule.
FTC appointed ex-FCC official Dale Hatfield as its monitor trustee to oversee AOL-Time Warner merger, as expected. Monitor authority was part of consent decree companies signed in Dec. (CD Dec 15 p1), which requires merged entity to add at least one independent ISP to its cable systems before adding AOL, and 2 more after. Trustee also will deal with other technical issues, such as capacity constraints. Hatfield recently restarted his Boulder, Colo., consulting business after retiring as chief of FCC Office of Plans & Policy. He’s also ex-staffer of Commerce Dept.
Qwest CEO Joseph Nacchio told state regulators fastest way to develop local competition was to “give competitors the freedom to take risks and enjoy the reward.” In keynote speech Mon. at NARUC winter committee meetings in Washington, he called himself “unabashed capitalist” willing to put money at risk where there’s best possibility of return. Talk came just one day before NARUC decision on its policy toward 2 federal-level deregulation proposals.
Joint 3G comments submitted to FCC by CTIA, Telecommunications Industry Assn. and PCIA outline scenarios under which industry sees feasible spectrum sharing or relocation of federal users in 1.7 GHz band. Making 1710-1850 MHz available through relocation and sharing, along with spectrum in 2110-2150 MHz and 2160-2165 MHz, would meet next-generation wireless requirements through 2010, groups said. Joint comments were among responses FCC received last week on how to make additional spectrum available for advanced wireless services (CD Feb 26 p4). Under proposal, associations said it would be feasible to make 1.7 GHz band available in 2-3 years. They proposed: (1) Relocating conventional fixed point-to-point systems to commercial systems, fiber, frequency bands above 3 GHz that are available for govt. point-to-point systems. Or systems could be relocated to nongovt. frequency bands available for point-to-point operations. (2) Sharing tactical radio relay systems with 3G through geographic and frequency segmentation. One possibility would be giving access to 3G systems in urban areas, where capacity demands were greatest, and giving Dept. of Defense access in rural areas where it conducts training exercises. (3) Acting on apparent infeasibility of spectrum sharing between 3G services and Air Combat Training Systems on geographic segmentation basis. Groups cited possibility for next-generation Joint Tactical Combat Telemetry System to be accommodated in spectrum used as guardbands for 3G operations. Groups also proposed ways for 3G systems to operate in spectrum now occupied by satellite control systems, including relocating earth station facilities to rural areas as short-term fix. Detailed technical report submitted by groups described reallocation of 1710-1850 MHz as providing “opportunity for DoD to modernize its communications systems and align its operations with the use of spectrum globally.” Report said DoD satellite operations in band didn’t conform with standard international operations for similar satellite operations. For example, Pentagon has harmonized satellite operations in downlink direction but uses nonstandard uplink, group said. Report also said that many federal fixed point-to-point systems were analog and relocation would provide chance to upgrade systems to digital. Relocation would provide users opportunity to be compensated for cost of relocation.