Telecommunications clearly is an industry where irony or consistency is not a major concern. For example, telecom attorneys sometimes find themselves arguing both sides of a major issue when they switch companies or their current company moves into new markets. Typical is the situation we have today where AT&T, which originated the investigation into ILEC special access rates in 2005 when it was a special access customer, now vigorously opposes any new ILEC special access regulation since it is a major supplier of special access service.

The latest instance of telecom inconsistency comes from the United States Telecom Association (USTelecom). Its members such as AT&T and Verizon are on record opposing Title II regulation for broadband Internet access service even if the FCC promises to forbear from enforcing many of the statutory requirements such as tariffing or unbundling. They argue that demonstrating the requirements for forbearance are difficult and would be strongly opposed by consumer advocates. Therefore, they claim, forbearance under Title II for broadband Internet access is unlikely and cannot be counted on.

However, at the same time they are against forbearance as part of Internet regulation, the ILECs, in the form of their major association, have filed a Petition with the FCC on October 6, 2014 seeking forbearance for many of their legacy Title II telecom regulations. As USTelecom states:

One key barrier to the deployment of new fiber facilities…is the continued application of legacy regulatory requirements to a subset of wireline telecommunications providers. The ILECs must divert substantial resources away from such next-generation networks. While cable, wireless, and competitive fiber providers are free to focus their expenditures on next-generation networks suited to delivering higher-speed services, ILECs must direct a substantial portion of their expenditures to maintaining legacy networks and fulfilling regulatory mandates whose costs far exceed any benefits.

This Petition is intended to present the Commission with a concrete agenda for allowing ILEC investment to be redirected away from legacy, narrowband, copper-based telephone networks and toward the deployment of next-generation facilities, thereby enhancing competition in the provision of truly high-capacity services and enhancing the nation’s communications infrastructure. USTelecom respectfully asks the Commission to forbear, under Section 10 of the Communications Act, from applying a collection of badly outdated provisions that apply only to wireline ILECs, even though these providers now serve a small minority of all lines in service. (See USTelecom Petition for Forbearance at pp. 3-5.)

Here are some of the key ILEC regulations US Telecom requests the FCC to forebear from enforcing:

The remaining obligations of Sections 271 and 272, as well as the Commission’s equal access rules -  Section 271 which required the Regional Bell Operating Companies (RBOCs) to open their local markets to competitors before being permitted to offer (interLATA) long-distance service has been fully implemented in every RBOC region. Section 272 which required RBOCs to establish separate subsidiaries when offering long-distance services has largely sunset. However, the Performance Assurance Plans (PAPs) that Section 271 required to ensure RBOCs were providing a certain level of service to competitors remains, and is a costly burden that is not needed. Finally, The Commission also should forbear from enforcing its legacy equal access requirements, which arose out of the AT&T breakup 30 years ago as a means of counteracting AT&T’s pre-existing advantages in providing long distance service through the RBOCs. These requirements, which apply to all ILECs, serve no meaningful purpose in today’s market, in which a wide variety of all-distance communications options exist independent of any need for providers to rely on ILEC facilities.

The Requirement to Provide an Unbundled 64 KBPS Voice Channel in Cases Where the ILEC has replaced a Copper Loop with Fiber and Retired the Copper Loop - ILECs incur wasteful costs by continuing to be required to provide a 64 kbps channel over fiber that would rarely be used given consumers’ shift away from traditional narrowband voice services.  

The Requirement to Share Newly Deployed Entrance Conduit at Regulated Rates - Currently the conduit access provisions of Sections 224 and 251(b)(4)  of the Act allow CLECs to demand access to ILEC-constructed conduits – at below-market rates – while denying ILECs reciprocal access to conduits their competitors construct. These one-sided obligations are not mandated by the plain language of the Act, do not serve the public interest, and do not benefit consumers. They are unnecessary and particularly inequitable in deployments where a new entrance conduit must be constructed.  

The Rules Prohibiting the Use of Contract Tariffs for Business Data Services in All Regions – Currently contract tariffs are permitted only in areas in which ILECs have pricing flexibility.  Forbearance would extend the benefits of contracts to the entire nation.

While some of the legacy regulations USTelecom seeks forbearance from make sense, such as the section 271 requirements and the equal access requirements, many will be fiercely contested. For example, CLECs will never agree to make contract tariffs available to more special access customers, especially since new grants of pricing flexibility have been suspended pending the Commission’s ongoing investigation into ILEC special access services. In addition, ILEC fiber retirement has already become extremely controversial and has already been challenged by CLECs.  

Thus, it is ironic that ILEC s are attempting to achieve through forbearance the removal of many of their Title II legacy Time Division Muliplexing (TDM) regulatory requirements even while dismissing forbearance as a way of regulating the Internet. Of course, I’m sure that this was the last thing on their mind when they wrote this Petition.   

Regardless of its merits, the Commission has yet to respond to the Petition, so we will have to wait to see if it develops into a full-blown proceeding.

By Andrew Regitsky, President, Regitsky & Associates

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