Broadband Consumer Protection, Disaster Recovery Dominate at NARUC
PALM SPRINGS, Cal. -- Broadband consumer protection and disaster recovery issues dominated telecom discussions at the NARUC meeting here. But NARUC panels on broadband- related policy resolutions either tabled or refocused resolutions when states sparred on how or whether to voice broadband concerns.
NARUC’s Telecom Committee tabled a resolution that would have urged the FCC and Congress to promote offerings of stand-alone DSL service as key to robust competition in voice, video and data services in a progressively deregulated setting. The resolution said no consumer should be required to buy circuit switched phone service as a condition for getting high-speed Internet access. Some states said the resolution wasn’t specific about whether it applied just to Bell companies or to all providers including rural incumbents and cable companies. Some states also saw a discrepancy between this resolution’s stress on DSL service and the broadband technology neutrality principles in NARUC’s “Federalism in Telecom” white paper adopted last July. The panel voted unanimously to table it until the Feb. meeting in Washington to study the impacts of stand-along DSL on rural carriers and markets.
The Telecom Committee drastically toned down a broadband resolution that originally outlined a list of concerns NARUC considered core issues the FCC needs to address in its new rulemaking on broadband consumer protection. The FCC asked whether consumer protections developed for common carrier telecom services should be addressed for broadband information services. Comments in that case are due Jan. 17, replies March 1. The telecom panel voted to delete whole sections of the resolution, including language saying consumer protections should be tailored to the broadband market’s characteristics. Also stricken were assertions that issues such as slamming, billing disputes and customer account privacy could be more difficult for consumers and broadband providers to resolve.
Other deleted language said “appropriate measures of broadband offerings’ reliability” are needed as broadband has a bigger role in the national economy, plus rules to ensure an orderly transition for consumers when a broadband provider exits the market. Gone also was language to the effect that rate averaging to promote consumer broadband demand could conflict with providers’ incentives for broadband network investment, as well as a paragraph saying the structure chosen for federal-state cooperation in developing and enforcing broadband consumer protection standards will have long-lasting impacts on broadband markets.
Some states on the panel said the disputed language made unsubstantiated assertions about potential consumer problems in the broadband market and made the states seem to be looking for problems to regulate before any problem actually exists. Supporters of the language said it identified consumer concerns the FCC needs to address. They said deleting the language would emasculate the whole resolution. In the end, the telecom panel voted 14-8 to strike the disputed language.
As finally and unanimously adopted, the resolution noted the FCC has called for comments by Jan. 17 on whether to apply to broadband information services any consumer protection provisions developed for common carrier telephone services relating to privacy, slamming, billing, service quality, facilities, rate averaging, regulatory involvement and enforcement. It urged states and consumer interests to file comments, directing the NARUC gen. counsel to file comments on the group’s behalf, consistent with the policies and proposals articulated in NARUC’s July “Federalism and Telecom” white paper.
The Telecom Committee passed unanimously a related resolution commending the FCC in its rulemaking for “recognizing and affirming the states’ interest in ensuring consumer protection and public safety goals are met.” The agency also drew praise for seeking comment on a NARUC proposal in its July “Federalism in Telecom” white paper that federal and state jurisdiction over broadband consumer protection should be determined along functional lines that take advantage of each jurisdiction’s respective experiences and expertise.
NARUC’s Consumer Affairs Committee tabled until the Feb. winter meeting a controversial policy resolution that would have supported federal and state regulatory declarations of broadband network neutrality that promote consumers’ access to the VoIP provider of their choice, ensure broadband providers treat all VoIP packets identically and ensure consumers get accurate information on broadband service quality. The resolution is based on 4 FCC broadband principles that promote an open, interconnected and competitive public Internet.
The resolution was tabled after Charles Davidson, dir. of the Advanced Communications Law & Policy Institute in N.Y., said it would make more sense for the FCC to address issues raised in the resolution because states have no major role in broadband regulation. Davidson criticized the resolution’s focus on network providers, not content providers, and its assertions about the state of the broadband marketplace. For instance, he said, there’s no evidence to support concern voiced in the resolution that broadband providers might limit consumers’ access to applications or content. Supporters on the committee said states still can express their opinions, even about regulatory areas outside their control. The resolution was tabled after 3 members of the Consumer Affairs Committee said they wanted more time for study.
NARUC members heard speakers on 2 Sun. panels address broadband consumer and regulatory issues. Jonathan Askin, gen. counsel with Pulver.com, said states are “the last best hope to ensure consumers have complete control over their broadband services.” He said voice and other broadband applications “ride on physical facilities that are under your control. Whoever provides the pipe shouldn’t be able to discriminate among retail customers or choke off their access to providers or services.” He urged retargeting of universal service programs to provide universal broadband access. Mary Lefave, Qwest public policy dir., said regulators “shouldn’t step in until there are problems that are beyond the scope of the attorneys general and state law.” She also said naked DSL represents a new niche market, but providing it means changing the loop qualification and administration systems based on legacy narrowband phone numbers not applicable to naked DSL.
Helen Hall, Verizon dir.-emerging technologies, said Verizon committed early on to “naked” DSL and, in remarks to the FCC, to provide it for at least 2 years after it merges with MCI. “The marketplace will work if we just let it,” she said. She said DSL’s limitations on upstream capacity may become “a huge problem” for consumers and providers in the future. Jason Wakefield, Covad senior Cal. regulatory counsel, said his company doesn’t need naked DSL to compete but supports the concept because “it expands competition.” But he said price stability and network neutrality with respect to DSL and similar services are essential for retail providers to build business plans.
The FCC “shot state regulation in the heart,” in its Aug. DSL policy order classifying DSL as an information service, said Jason Oxman, CompTel senior vp. He said the FCC order took away states’ ability to protect their consumers. He said the FCC gave the Bells what they wanted -- freedom from any regulation of their DSL offerings. Qwest’s Lefave, though, called the FCC order “a well-reasoned attempt to bring regulatory sanity to broadband service.” She said the order relieved Qwest of having to notify competitors of deployment plans and give advance notice of price promotions. She said deregulation of DSL won’t stop Qwest from doing business with CLECs and ISPs: “We want to keep people on our network.”
Rick Cimmerman, NCTA vp-state govt. affairs, said the FCC DSL order flowed from an earlier FCC decision to classify cable modem services as an unregulated information service. He said that move prompted the Bell companies to seek equal treatment for DSL as it competes against cable modems. “The irony is that while they wanted equal treatment on the phone side, they are seeking special treatment for their entry on the video side.” Bill Kehoe, FCC senior wireline policy attorney, said part of what the FCC tried to do was to look at all the rules developed for circuit-switched monopoly phone service and decide if any applied to broadband. He said the FCC decided the costs of applying legacy narrowband regulation to broadband exceeded any public benefits. He said the FCC developed a transition plan to a new light regulatory framework for broadband as an information service, using its ancillary jurisdiction to assert regulatory authority over information services.
Later, speakers at a NARUC panel on the disastrous Gulf Coast hurricanes said the main lesson to telecom and energy providers was that coordinated preparation efforts by utility providers, regulators and emergency management agencies are crucial for managing and speeding recovery from disaster. But they also said some disasters, like Katrina, are so staggering as to be beyond any preparation efforts. Dane Snowden, CTIA vp-strategic relations, said wireless carriers prepared in advance by stockpiling resources, establishing links with emergency management agencies, and setting priorities for restoration. “The process worked. But nobody expected the extreme devastation of Katrina. We found the biggest obstacle was gaining access to our network facilities for repairs and restoring power.” Snowden said wireless carriers lost service at 7,000 towers in the affected states and said the FCC needs to promote construction of more towers across the U.S.
Tim Peterson, FCC chief-strategic plans & policy, said the FCC labors under 2 major weaknesses in addressing natural disasters: It has no authority over electric companies, and it’s in D.C. rather than at the disaster location. But he said the FCC has a depth of technical expertise in telecom and broadcasting that states may not have: “The FCC and state commissions have complimentary strengths and weaknesses in disaster management that scream for closer coordination.” He said a problem for recovery is that in most states, E-911 centers aren’t listed at all as a telecom restoration priority. He said the FCC recognizes that telephone and electric service are interdependent, but since the FCC has no role in electric regulation it must develop communications channels through the states to ensure it stays up to date on electric power restoration. He said the various entities involved need to “coordinate on a more formal basis going forward.”
Tex. PUC staff member Mike Gray said regulators in normal times have to balance utility demands for huge, costly “catastrophe reserves” against ratepayer demands for low rates. He said Tex. electric utilities used innovative ideas to shift power around damaged or destroyed facilities and federal energy regulators were quick to approve these novel temporary approaches. Randy Helmick, Entergy consumer services vp, said that, despite preparations, lots of its responses were simply reactions to circumstances as they arose. “We did a good job on the fly, despite losing our corporate headquarters [in New Orleans] to the floods,” he said. He said Entergy just a month before Katrina struck had conducted a business continuity and disaster response drill that envisioned almost exactly Katrina’s staggering strike.
John Ruscilli, BellSouth state regulatory dir., said BellSouth learned from the storms that it needs much closer communication with regulatory agencies in times of disaster. He said local 911 authorities need better backup plans for when their primary facilities fail. BellSouth, he said, has long experience with hurricanes and made advance preparations, “but a disaster of this magnitude tried us sorely.” He said all providers pulled together “because we all are providers and customers of each other.” David Conn, T-Mobile dir.-state affairs, said “the magnitude of Katrina took everyone by surprise.” He called for more and better coordination among all affected entities. He also said telecom providers need to have priority in the national Telecom Service Priority Program equal to first responders. -- Herb Kirchhoff
NARUC Notebook…
Don Stockdale of the FCC Wireline Bureau told NARUC’s Telecom Committee his bureau will address 5 big issues in coming months. He said there’s a “critical need” to move on intercarrier compensation reform. He said FCC Chmn. Martin favors a “single unitary rate at some point above zero.” Another high priority, he said, is reform of universal service fund contributions to achieve a “sufficient, efficient and sustainable collection method.” He said Martin “advocates a number-based contribution method.” Other items on the bureau agenda, he said, include VoIP 911 and recommendations by the FCC-state VoIP 911 enforcement task force, a rulemaking notice relating to a federal appeals court remand of nonrural high-cost support rules, and publishing a draft order on petitions from 5 states requesting the FCC delegate authority to them over 1,000-block number pooling. Thomas Wyatt of the FCC Consumer & Govt. Affairs Bureau said a high priority is ensuring telecom access for all types of disabilities, not only deafness, but he didn’t outline specifics. Enforcement Bureau Chief Kris Monteith said there has been major progress on ensuring that VoIP providers comply with FCC orders to notify customers about any limitations on 911 service. She said 107 providers have gotten acknowledgments from over 90% of customers, and 14 providers from 70-89%. But she said 38 providers have less than a 70% acknowledgment rate and “our next steps for them are under consideration.” She also said universal service contribution enforcement efforts against 7 carriers this year brought in $20 million in delinquent contributions, and her bureau has issued notices to other carriers delinquent by $5 million more, total.
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The Joint FCC-NARUC Task Force on VoIP 911 Enforcement announced at NARUC launch of a website to tell consumers, industry and govt. offices about the rules that require VoIP providers interconnecting with the public switched phone network to provide E-911 service to customers. The duty to deliver all VoIP 911 calls to the customer’s local emergency operator and provide calling location information to that emergency operator takes effect Nov. 28 -- www.voip911.gov.