Northpoint and DBS companies were expected to miss Feb. 19 deadline imposed by Congress to conduct tests to determine whether terrestrial service proposed by startup Northpoint could share spectrum in 12.2-12.7 GHz band (CD Jan 31 p3) without causing interference. Meanwhile, FCC issued correction in order setting up testing procedures by companies. Overall testing of equipment and technology has been major sticking point as Commission decides on issuing Northpoint license, both companies agree. “This is the final showdown for all terrestrial systems,” Northpoint CEO Sophia Collier told us: “This will show who has technology and who doesn’t.” Pegasus Vp John Hane said Northpoint legal maneuvering at FCC in effort to get license had been “unprecedented.” He agreed testing wouldn’t be completed in time. There was no word on when results might be finished or made available by Mitre, company hired by FCC to conduct testing. Mitre Engineer James Marshall didn’t return phone calls and company spokeswoman wasn’t up to date on testing procedures.
FCC asked for comments by March 20 on request by City Signal Communications for preemption of regulations by city of Eastlake, O., that City Signal called discriminatory. Company complained that city told it right-of-way authorization wouldn’t be granted unless City Signal paid franchise fee, although other telecom providers don’t have to pay fee. Replies are due April 4.
Sources said 4 FCC commissioners are considering decision that would deny cable must-carry status to electronic program guide (EPG) transmitted over vertical blanking interval (VBI) of local broadcast stations. Prospective ruling in Gemstar case, which pits Gemstar-TV Guide International, broadcasters and CE manufacturers against Time Warner Cable and other cable operators, would follow recent Cable Bureau recommendation that broadcasters’ must-carry rights shouldn’t extend to 3rd party EPGs. Instead of gaining mandatory carriage on cable systems, Gemstar would have to negotiate its way onto systems, just like cable networks and other nonbroadcast services.
FCC proposal to require standardized reporting by TV stations of their public service activities doesn’t violate First Amendment, public interest groups said in reply to earlier broadcaster comments (CD Dec 20 p2). Broadcasters had said reporting requirements would impose de facto quotas for public service programming, violating broadcasters’ rights. However, Morality in Media said nothing in proposed rules constituted prior restraint and broadcasters remained “free to air what they please.” More comments were expected too late for our deadline.
Deadline for DirecTV’s threat to terminate programming distribution agreement with Pegasus Communications passed last week despite former’s claim that it was owed $6.2 million for subscribers gained outside latter’s exclusive sales territories. DirecTV, which had set Feb. 15 deadline for resolution of dispute covering 7,188 subscribers, said it was owed revenue collected from customers before they were transferred to its service area. Subscribers were split between Pegasus and Golden Sky, which Pegasus acquired in last year. DirecTV notified Pegasus of disputed revenue Jan. 15, Pegasus said in SEC filing.
FCC International Bureau plans to hold March 14 public forum on issues related to U.S. companies’ entry into telecom markets in foreign countries. Forum will be at FCC hq, 10:30 a.m.-noon. Bureau said information provided at forum will be used to supplement 2000 edition of FCC’s International Markets Report.
Verizon Wireless was among telecom carriers filing petitions for reconsideration last week on FCC’s building access order that lets building owners require relocation of network demarcation without getting approval of subscribers. Verizon Wireless contended order shouldn’t apply to commercial mobile radio service (CMRS) operators because their location of transmitters in multitenant environments didn’t raise same type of anticompetitive concerns that order addressed. “Because CMRS providers cannot affect competition by entering into exclusive access arrangements with building owners,” it said, there’s no credible reason to extend provisions of order to CMRS operators. CMRS providers generally don’t require access to building space or wiring to provide wireless service to tenants in building, Verizon said. Real Access Alliance contended FCC decision was mistaken on: (1) Role of building owners in development of facilities-based competition. (2) Scope of FCC’s authority to expand Over-the-Air- Reception Devices (OTARD) rule to include antennas used to receive and transmit data and voice communications. (3) Agency’s authority to interpret Sec. 224 of Communications Act to apply to facilities and rights inside buildings. “Building owners fall outside the Commission’s jurisdiction,” Alliance said. “The Commission concedes as much in the further notice of proposed rulemaking released with the orders, which seeks to achieve the CLECs’ goals by regulating carriers rather than property owners.” On narrower grounds, Wireless Communications Assn. (WCA) filed petition for partial reconsideration, asking FCC to clarify that safety exception of rule applied “to any professional installation requirements adopted by nonfederal authorities for subscriber premises fixed wireless transceivers that are protected by the rule.” WCA said exception prohibited “safety-related” antenna restrictions that would impair installation of subscriber premises fixed wireless antennas unless they met certain caveats, such as being nondiscriminatory. Triton Network Systems said that although it believed FCC properly expanded OTARD rule, it appeared “to have unintentionally excluded certain fixed wireless devices that should be appropriately covered.” Triton asked agency to clarify that restrictions weren’t designed to exclude certain fixed wireless devices deployed in consecutive point networks. Smart Buildings Policy Project also asked limited reconsideration.
AT&T isn’t “obligated to pay” overly high switched access charges to Eschelon Telecom, spokesman said in response to complaint Eschelon filed at FCC for nonpayment (CD Feb 16 p6). He said AT&T had asked Eschelon not to provide AT&T with access services because “Eschelon is seeking to charge access rates that are several times higher than incumbent local exchange carriers’ rates.” He said AT&T had talked to Eschelon about reaching “commercial agreement under which AT&T would order access services at competitive rates” but hadn’t been able to reach any agreement.
FCC granted complaints by AT&T and WorldCom Fri., ruling that U S West calling service -- 1-800-4USWest -- violated Sec. 271 of Telecom Act because it permitted long distance calling by U S West’s local customers. Complaints were filed 3 years ago, before Qwest acquired U S West. Commission said case was similar to one last year in which FCC found Ameritech’s calling platform in violation of Telecom Act. “The evidence… demonstrates that U S West’s service is, in all material respects, the same as Ameritech’s unlawful service,” FCC Enforcement Bureau said in order. Among problems, agency said: (1) Calling plan was designed as combined service offering long distance component. (2) U S West relied on its brand name to market combined offering. (3) It used bill inserts and other mailings to promote service to its subscriber base. (4) It “maintained control and ownership of the customer relationship in connection with the combined services offering.” (5) It had “exclusive control” over marketing service. (6) It selected long distance provider that would carry interLATA calls and dictated certain terms. AT&T said case offered “clear- cut violation of Congress’s mandate that a Bell company not enjoy the benefits of being in the long distance business without first complying with the requirement that it open its local markets to competitors.” AT&T said case had been pending for several years and it hoped action “signals a resolve by the new FCC to act promptly to rule on complaints that Bell companies are violating their duties under the Act and the FCC’s rules.”
Responding to request for information from FCC International Bureau, Deutsche Telekom (DT) and VoiceStream emphasized there’s “no substantial possibility” that Germany’s competitive or regulatory environment “could harm competition” in U.S. “There is nothing in the record to demonstrate that the merged company could engage in anticompetitive cross-subsidization or predation.” In connection with proposed merger of Germany’s DT, VoiceStream and Powertel, International Bureau Chief Donald Abelson sent list of 23 questions to DT and VoiceStream earlier this month. Questions included percentage of business and residential loops in Germany controlled by DT, how foreign holdings of DT were treated for regulatory purposes and whether govt. shareholders were bound to vote with majority of other owners. Bureau also asked about separate $5 billion investment that DT made in VoiceStream in advance of merger’s closing. Companies replied Germany doesn’t regulate DT’s foreign operations, including U.S. affiliates. They said carriers had several options for bypassing DT facilities when bringing traffic into Germany from European countries where there are landing stations for U.S.-Europe undersea cables: Carriers can route traffic to any point in Germany without using DT facilities. Variety of alternatives “makes clear that no bottleneck exists for international services in Germany,” companies said. Answers also addressed concerns raised by Sen. Hollings (D-S.C.) that $5 billion investment by DT amounted to 39% of VoiceStream’s capital stock. Hollings has contended DT’s current stake in VoiceStream should be assessed, based on Commission precedent, by comparing DT’s investment with VoiceStream’s total “paid-in capital.” Companies said: “This argument is simply wrong.” They said Hollings misinterpreted past decisions of FCC in determining amount of “alien beneficial ownership.” One of cases cited as precedent is FCC order granting Fox TV stations permanent waiver of 25% limit on alien ownership of stations based on ownership of Australia-based News Corp. Unlike transactions at stake in Fox and NextWave cases, companies told bureau “share ownership is the only accurate means to evaluate alien beneficial ownership of VoiceStream.” Paid-in capital analysis would “greatly overstate” actual amount of alien beneficial ownership, companies said.