In telecommunications we have found, sometimes to our chagrin, that there is no issue that is ever settled completely. There apparently is just enough ambiguity in every FCC order to enable sharp as a tack lawyers with the opening to challenge and sometimes even win a change in the rules. We thought, however, that the rules for unbundled network elements (UNEs) could be the one exception. 

The requirement that ILECs must provide UNEs to requesting CLECs was originally codified by section 251(c)(3) of the 1996 Telecommunications Act. ILEC unbundling requirements were later revised in the FCC’s 2005 Triennial Review Order, which eliminated some of the requirements, such as unbundled switching for mass market customers, but continued to require ILECs to provide unbundled DS1 and DS3 loops to competitors. Since the Triennial Review Order, there have been relatively few industry disputes about unbundled network elements (at least by telecom standards).

We had thought that in the industry transition to the Internet protocol (IP) network, ILEC unbundling requirements would continue to be a settled matter. After all, in the Triennial Review Order, the Commission stated that ILEC unbundling is required regardless of the technology involved.  Moreover, in its recent Technology Transitions Notice of Proposed Rulemaking (NPRM) released in November, the Commission stated that “the mere fact that a carrier obtains discontinuance authorization under section 214(a) for [copper] services has no legal bearing on its obligation to provide UNEs.”  (NPRM at para. 109)  

According to Windstream, however, the issue of the availability of ILEC unbundled DS1 and DS3 loops is far from settled. In a Petition for Declaratory Ruling filed on December 29, 2014, the CLEC has requested the FCC to issue a declaratory ruling confirming that an ILEC’s obligations to provide DS1 and DS3 capacity loops on an unbundled basis pursuant to section 251(c)(3) are not altered or eliminated either by replacement of copper with fiber or by the conversion from the Time Division Multiplexed (TDM) to the IP network. 

In response, the Commission began a new proceeding to examine this issue (15-1), with industry comments due on February 5, 2015.

In its Petition, Windstream asserts that in recent filings, Verizon and AT&T have asserted that their unbundling obligations do not exist when they replace copper with fiber facilities or they transition their networks to IP. For example, Wimdstream notes that;

In its recent notices of intent to retire its copper facilities in certain wire centers, Verizon states that after the retirement it will “no longer be required to offer UNEs or other services over copper facilities,” and confirms only that it “will offer to requesting carriers a 64 kbps voice-grade channel over fiber loops,” with no mention of its continuing obligations to provide access to DS1 and DS3 capacity unbundled loops pursuant to [section] 251(c)(3)... AT&T also has claimed that there is “no high capacity loop UNE requirement in an all-IP environment,” and disavows any plans to ensure that the access provided “is functionally equivalent to that provided immediately before the [technology transitions] experiment” through unbundling, notwithstanding the Commission’s direction. In its reply comments on its Technology Transitions proposal, AT&T expressly disclaims any obligation to continue to provide unbundled DS1 and DS3 capacity loops after the IP transition, stating that “any obligation…to provide unbundled access to DS1s and DS3s is limited to those situations where TDM remains in place.” (Windstream Petition at pp. 10-11, footnotes omitted)

As noted above, Windstream requests the Commission to confirm that an ILEC’s obligations to provide unbundled DS1 and DS3 capacity loops do not end with the replacement of copper with fiber or with the conversion of the transmission of traffic over loops to an IP environment. “Specifically, the Commission should make clear that all ILECs subject to Section 251(c)(3) are required to continue to provide unbundled DS1 and DS3 capacity loops where the impairment trigger has been met, regardless of whether they have retired copper facilities or transmit traffic over those loops in an IP format, and they cannot unilaterally alter those requirements in a network change notification or with service discontinuance.” (Id. At 11)        

Windstream’s request seems pretty straight-forward and air tight to us. Based on everything the Commission has said in the past, the section 251 unbundling requirements are not technology limited and should not be impacted by the move to a fiber-based IP network. If the Commission were to limit ILEC IP unbundling requirements it would make it even more difficult for CLECs to compete in an IP environment where special access is becoming obsolete and CLECs will have to build their own networks or purchase off-tariff ILEC Ethernet offerings offering less FCC protection. 

We think that it would serve the industry for the Commission to quickly decide in Windstream’s favor and grant its Petition. However, as we have found out, painfully at times, somewhere out there is a sharp lawyer already finding holes in Windstream’s arguments…