It is the holiday season and in the spirit of giving, we here at the CCMI TelcoExchange Blog thought it would be the perfect time to provide our friends at the FCC with some much needed (if not appreciated) Christmas wishes. So without further adieu, here we go!

Put Aside Political Differences - There are two themes that marked the FCC in 2015. The first is the tendency for every important decision to be decided on a 3-2 vote based on the political party of the five commissioners. Decisions such as the reclassification of broadband Internet access as a telecommunications service and the decision to usurp state authority over private broadband networks can easily be reversed once there is a Republican president and a Republican majority FCC. If the Democratic commissioners want to consolidate their gains, they would be better served through compromise rather than ramming through 3-2 partisan decisions.

Enough with Butting Into Specific Company Business Plans – The other overriding theme of 2015 is the Commission’s self-appointed authority to examine the business plans of Internet service providers (ISPs) to decide if specific services are reasonable before companies can even offer them. This “future Internet Conduct” rule is excessive and will serve only to suppress investment in broadband and the Internet.  Moreover, the Commission’s decision to broaden its authority to examine the interconnection agreements between ISPs and edge (content) providers is a bridge too far and the DC Circuit Court should find it unlawful.  A less active FCC in 2016 would help competition.

Request Congress to Fix Net Neutrality – Everybody knows that regardless of how the FCC’s Open Internet Order is decided by the DC Circuit Court, it will be appealed to the US Supreme Court, subjecting the industry to more years of uncertainty. Republicans have already agreed to the Commission’s bright line rules of “no blocking,” “no throttling,” and no paid prioritization of Internet traffic. Therefore, the implementation of specific Title II rules is simply unnecessary. Congress could write and pass a Net Neutrality law in weeks and give the Commission every meaningful provision it originally was seeking.

Ease Up on ILEC Special Access Rates – For someone who has spent most of his career fighting for lower ILEC special access rates, the FCC’s two investigations into ILEC special access rates and regulations are beginning to amount to overkill.  Yes, ILECs make extraordinary special access profits, but any attempt to now change special access regulation such as re-imposing a price cap productivity factor to force down rates will lead to a multi-year court battle over a declining market. At this point, the Commission would be well served on focusing on easing obstacles ILECs have placed in the way of CLEC and enterprise customers attempting to switch from time-division-multiplexed special access to packet-based Ethernet. These obstacles, such as excess termination liabilities and optional payment plans that count special access and not Ethernet circuits, are the real problem facing ILEC customers today. While there are situations in which FCC intervention is helpful, such as ensuring reasonably comparable replacement services are available when ILECs discontinue special access services, the Commission’s focus on 2016 should be clearing a path for ILEC customers to move to Ethernet. Viable Ethernet offerings are the best market check on excessive special access rates, since the ILECs wish to preserve special access revenues as long as possible.

Fix the Universal Service Program – There is rare industry agreement that the universal service program is broken in several ways, and must be fixed as quickly as possible. First, change the contribution methodology from the current one (based on projected collected interstate and international end user telecommunications revenues net of projected contributions), to one based on working telephone numbers or capacity of service ordered. There is no good way anymore to isolate interstate telecommunications revenues in a packet-based world and the contribution factor has reached 18 percent for the first quarter of 2016. It simply must be changed. Second, require ISPs to contribute to the fund. If ISPs are now telecommunications carriers, then they should be treated the same as other carriers and pay their fair share. Finally, expand the Lifeline program to include broadband.  All Americans should have viable Internet access in 2016.

Require More Public Information Regarding Technology Experiments – AT&T is conducting a major technology transitions experiment in Alabama and Florida which will be used by the Commission to ensure consumers and businesses are protected during the transition to an IP-based network world. However, very limited results have been made available and even when AT&T files its periodic reports, important results are filed confidentially. How is the public supposed to have confidence in a transition where almost everything is done secretly? In addition, the experiments will have no binding effect on how the transition will impact wholesale competition. With more experiments approved for 2016, the Commission’s failure to use the experiments to develop transition rules for wholesale providers will cripple the usefulness of these experiments going forward.

Require IP Interconnection Agreements to Comply with the Section 251 Rules – One of the Commission’s most egregious failures over the last few years is its failure to require ILECs to be bound by its section 251 interconnection rules when negotiating IP interconnection agreements with CLECs. This failure allows ILECs to use their market power to potentially advantage themselves with unfair traffic exchange rules or prices. This FCC failure puts CLECs in a take-it-or leave-it position in a situation where they have to take it and is simply unfair, especially since IP traffic is now classified as telecommunications traffic.

All the Commission needs to do for a banner 2016 is follow these simple seven suggestions! And while we wait for miracles to happen, a Merry Christmas and Happy Holiday to all of you!    

By Andy Regitky, CCMI