AT&T said it planned to ask Colo. PUC and regulators in other Qwest states to investigate whether Qwest had made illegal secret agreements with selected CLECs that provided favored carriers with rates and terms not available to other competitors. Colo. is Qwest’s hq state. AT&T was reacting to complaint against Qwest filed with Minn. PUC last week by Telecom Div. of Minn. Dept. of Commerce on behalf of state’s retail telecom ratepayers. Minn. complaint alleged Qwest made secret amendments to interconnection contracts with selected CLECs to mute their opposition to Qwest long distance entry and other Qwest regulatory initiatives. It charged that Qwest and “partner” CLECs might be concealing favorable terms so other CLECs couldn’t opt into them. Minn. complaint didn’t name specific CLECs or deals. Qwest has denied Minn. charges.
Minn. Dept. of Commerce asked Minn. PUC for up to $200 million in civil penalties against Qwest for allegedly making secret “sweetheart” interconnection deals with certain competitors, unlawfully discriminating against other carriers. Commerce Dept. complaint alleged Qwest made secret amendments to interconnection contracts on file at PUC that gave favored CLECs preferential rates, terms and grades of service not offered to other carriers. Commerce Dept. staffers said purpose might have been to buy off CLECs critical of Qwest’s long distance entry and local market activities. Qwest strongly denied charges and said it filed all details of all 150 current CLEC interconnection agreements with PUC as required by rules. Depending on number and duration of alleged offenses, PUC could fine Qwest up to $202.5 million under 1999 state law that prohibits Qwest from engaging in anticompetitive conduct. Law’s penalties apply only to Qwest. CLECs that entered into sweetheart deals wouldn’t face financial penalties.
Opponents of Tauzin-Dingell data deregulation bill confirmed they would introduce line-sharing and telecom antitrust amendments if and when legislation reached House floor later this month. Bill (HR-1542) by House Commerce Committee Chmn. Tauzin (R-La.) and ranking minority member Dingell (D-Mich.) would ensure Bells could provide Internet backbone and high-speed Internet service across their respective interLATA boundaries without FCC approval. But House critics came out Thurs. in support of CLEC lobbying effort on Capitol Hill, endorsing competitive carriers’ claims HR-1542 would stifle rather than increase capital investment in advanced communications infrastructure.
With officials acknowledging negotiations on ultra- wideband (UWB) had been contentious at times, FCC Thurs. approved order to allow technology to move forward -- for now -- at very conservative power limits. At agenda meeting, Commission approved order that would let UWB communications devices to operate at 3.1-10.6 GHz, with out-of-band emissions limits set for below 3.1 GHz. Cut-off point for what is considered in-band UWB emissions is lower than 6.1 GHz threshold that Dept. of Transportation had sought and 4.1 GHz level that Defense Dept. had been backing. DoT declined to comment on FCC action, although spokesman confirmed that Transportation Secy. Norman Mineta had sent letter to National Security Adviser Condoleeza Rice on issue Mon. Pentagon said “strict technical limits below 3.1 GHz” would continue to protect military systems, including GPS. Meanwhile, NTIA Deputy Asst. Secy. Michael Gallagher told us that final decision represented policy victory, although transparency concerns raised during proceeding would be among issues examined in upcoming NTIA spectrum summit.
As FCC gears up for Thurs. vote on ultra-wideband (UWB),several lawmakers urged Commission to not let date slip again on item. Agency had deferred vote at Dec. agenda meeting in response to letter from Commerce Secy. Donald Evans seeking more time to evaluate safety-of-life and other issues. Among apparent concerns of some on Capitol Hill and in private sector is lack of transparency in parts of negotiating process between NTIA and FCC. Because of high stakes nature of UWB proceeding, several industry observers said it had brought to forefront natural tension between FCC’s regulatory role over commercial spectrum and NTIA’s purview over govt. bands.
This is “do-or-die” year for telecom bills in state legislatures. Except in 2 states, all telecom bills pending in 2002 sessions must pass before this year’s adjournment or they're dead. Only in N.J. and Va. can bills from this year carry over to 2003. Accordingly, many state lawmakers are making swift decisions on early telecom measures even as floodgates have opened to new telecom-related legislation. In this report, we're updating status of previously-reported bills and noting significant new legislation that’s recently been introduced. Bills are grouped by subject, with advancing/defeated bills mentioned first in each group.
Nationwide TV & Appliance Assn. is launching BrandsDirect.com e-commerce business with links to 500 of its dealers, capping nearly 2 years of development. BrandsDirect, which is expected to add another 300 retailers later this year, is focusing on “several thousand” SKUs of major appliances at start, will add CE by early 2003, Chmn. Edward Kelly said. Major appliance vendors that have signed on with BrandsDirect include Amana, Fisher Paykel, Frigidaire, GE, KitchenAid, Maytag and Whirlpool.
Despite facing various obstacles in 2001 -- most prominently troubled economy and terrorist attacks Sept. 11 -- traditional toy industry (excluding videogames) still managed 1.7% sales growth, Toy Industry Assn. (TIA) Chmn. Patrick Feely told N.Y.C. news conference Thurs. kicking off annual American International Toy Fair. Retail sales in 2001 reached $25 billion, up from $24.6 billion year ago. Results, he said, were particularly positive when compared with how other industries fared in 2001.
House Commerce Committee Chmn. Tauzin (R-La.) and U.S. Attorney Gen. John Ashcroft separately are pressing FCC to act swiftly but cautiously in adopting rules for federal inmate payphone services. Sec. 276 of Telecom Act includes “mandatory, not discretionary” provision directing Commission to ensure adequate supply of payphones and competition in payphone services in correctional institutions, Tauzin wrote FCC Chmn. Powell Feb. 4. Congress also had directed FCC to establish “per-call compensation plan” within 9 months of Act’s enactment to provide fair compensation to carriers for all calls from such settings, he said: “However, it is now 6 years since the enactment of Section 276, and the Commission has yet to fully implement” its requirements. Tauzin emphasized that before FCC adopted rules in that area, it “must do whatever is necessary to maintain and improve, not degrade, the mechanisms currently in place to monitor and control inmate calling and to detect and weed out illicit activity.” Ashcroft told Powell in letter Feb. 1 that Dept. of Justice “strongly opposes any initiative that would allow an inmate or an inmate’s called party to select their own” carrier. He said “if inmate telephone service is opened up to virtually all telecommunications providers,” ability of law enforcement to prevent inmates from harassing victims and witnesses of crime and to “monitor and trace calls for criminal activity” would be hampered: “Federal correctional facilities must maintain their current ability to control the telephone carriers who route inmate calls.”
Negotiators must see world “with digital glasses on” in next round of World Trade Organization (WTO) talks, AOL Time Warner International Public Policy Dir. Laura Lane said in session on AV services at Commerce Dept. conference on trade expansion objectives in service industries Feb. 5. World has changed since last round of talks 8 years ago in Uruguay as companies such as AOL Time Warner scramble to provide information, content and services to consumers via Internet, she said. To do that, many different kinds of companies now must work cooperatively in “merged” world marketplace without borders, fact that negotiators must take into account when creating trade regime: “We don’t need analog [trade] restrictions,” Lane said.