FCC URGED TO ACT IN BROADBAND PROCEEDINGS

While disagreeing whether the FCC should grant Verizon’s petitions concerning regulatory treatment of its broadband services provided via fiber-to-the-premises (FTTP), in comments to the Commission, telecom carriers agreed the Commission should focus on its broadband rulemaking proceedings, such as the wireline broadband and ILEC broadband NPRMs.

Verizon filed 2 petitions with the Commission this year regarding its deployment of FTTP infrastructure. In one, the company asked that the agency either make a declaratory ruling on broadband services provided via FTTP or waive its common carrier and Title II rules for an interim period, the same as it has with cable modem service providers. In the 2nd petition, Verizon asked that -- in absence of a declaratory ruling -- the Commission provide interim regulatory relief for such services until it establishes an appropriate regulatory framework for broadband services. Verizon said it planned to offer FTTP broadband services, such as video, high-speed Internet access and voice, and to obtain cable franchise for its video offerings. Because of that, it argued the Commission should provide FTTP broadband services the same regulatory treatment as cable modem services.

While supporting the petitions, SBC said “the best course of action would be for the Commission to act on its Wireline Broadband NPRM and its ILEC Broadband NPRM.” SBC stressed the Commission should “afford the same deregulatory relief already provided to cable modem service to all wireline broadband Internet services provided over architectures that drive fiber deeper into customer neighborhoods, including, at a minimum, FTTH.”

Competitive carriers, including AT&T, Sprint and Covad, opposed the petitions. Calling the requested relief “patently unlawful,” AT&T said that, while asking that its FTTP service should be governed the same way as cable modem services, Verizon ignored that “regulatory parity would require that the Commission find that Verizon’s FTTP service includes a separate ’telecommunications service’ component and that Verizon must separately tariff and transform service and make it available upon non-discriminatory, just and reasonable rates.” It said any other ruling would “not only potentially subject the Commission to mandamus for flouting the mandate” of Brand X v. FCC, but also of California v. FCC. In any case, AT&T said the Commission had “no authority to issue the declaratory order sought by Verizon.”

AT&T said it was “clear that what Verizon really seeks to accomplish is to rush the Commission into making legal rulings that would bind the Commission in the pending rulemaking proceeding.” It said the FCC in the past had rejected “this type of piecemeal approach, and it should address the legal policy issues raised in Verizon’s petitions comprehensively in the pending Wireline Broadband Proceeding.”

ALTS urged the Commission to reject the petitions because it said “granting interim relief here would be premature and unnecessary.” It said the Commission should grant regulatory relief for retail service offerings only after careful consideration of the records in its rulemaking proceedings on appropriate regulatory treatment of broadband services. ALTS had opposed deregulation of the ILECs’ broadband transmission services in those proceedings. “Increased competition, not widespread deregulation, is the best method to spur innovation and further deployment in an industry where monopoly providers control bottleneck facilities,” it said.

ALTS also said the FCC’s cable modem decision was “not dispositive over regulation of wireline broadband services” and should “in no way prejudice the Commission’s decision in the Broadband proceeding.” It said there were “significant differences between wireline and cable modem services that justify disparate regulatory treatment.” Moreover, it said reliance on in the cable modem decision was “misplaced” after the U.S. Appeals Court, San Francisco, overturned the Commission’s classification of cable modem service as exclusively an information service.

But SBC said “the Commission’s conclusions in the Cable Modem Order have even greater force in the wireline context.” It said the deployment of advanced, fiber-based wireline broadband services would require substantial investment (as much as $2,000 per home served). “Inducing incumbents to make those substantial investments requires a light regulatory touch,” it said. SBC also argued interim relief was “not only appropriate but also compelled by the requirements of the 1996 [Telecom] Act.”

The Justice Dept. urged the Commission to “take no action in response to Verizon’s petitions that could preclude or call into question the applicability of… CALEA to providers of FTTP broadband services.” It said it was taking no position on whether the Commission should require Verizon’s FTTP broadband services to be subject to unbundling, tariffing or cost-justification requirements or any economic regulation.