By Paul Barbagallo
The fight over whether the Federal Communications Commission should approve
new rules for “special access” services has been reignited with the revelation
that the agency's chairman, Julius Genachowski, has begun circulating an order
setting forth what FCC have called a “clear path to reform.”
A representative for Genachowski told BNA June 4 that the order would, among
other things, suspend all petitions for pricing flexibility while the agency
collects more data and drafts new regulations.
While few details were made available, Verizon Communications, AT&T Inc.,
and CenturyLink, the largest telephone companies in the country, are expected to
be subject to new regulatory constraints.
As expected, the former Bell companies offered criticisms of the FCC's order
and its smaller competitors.
“The services in question are called 'special access' services--95 percent of
which are slow 1.5 megabits per second (Mbps) … (think POTS) services,” said Bob
Quinn, AT&T's senior vice president of federal regulatory and chief privacy
officer, in a blog post June 5. POTS stands for plain old telephone service.
“That is not a misprint,” Quinn wrote. “We are not talking about 100 Mbps
connections--services we should actually be figuring out how to get to more
people in more places. We are not even talking about fiber. We are talking about
legacy, copper-based services that are so slow the services would not qualify
for a single dollar of Universal Service Fund [USF] support if they were
deployed to homes throughout rural America under the commission's recent USF
In many areas throughout the United States, only one telecom carrier
maintains the high-capacity fiber-optic lines--special access--that provide huge
volumes of phone and internet connections to businesses. For years, wireless
carriers led by Sprint Nextel Corp. and T-Mobile USA, and other smaller market
players such as XO Communications and Level 3 Communications, have alleged that
AT&T Inc., Verizon Communications Inc., and Qwest Corp. charge too much to
lease capacity on their lines.
These companies rely on special access connections to provide broadband
services to business customers. The lines, also known as DS1s or DS3s, allow
Sprint and other companies to backhaul their customers' voice and data traffic
from a cell site to the communications network.
But AT&T and Verizon argue that their rates have actually decreased, and
in some markets cable operators also offer such services.
AT&T's Quinn said the FCC should instead craft a plan to retire these
services and get businesses and competitive carriers on the path toward
deploying fiber-based broadband services that are much faster than 1.5 Mbps.
“The fact is that special access is competitive and has been operating under
regulatory flexibility for more than 12 years,” said Walt McCormick, president
and chief executive officer of USTelecom, in a statement June 5.
Sprint Nextel, among other rivals to AT&T and Verizon, lauded the FCC's
action, calling special access the “lifeblood of the broadband economy.”
“These high-speed broadband circuits work every time you use your credit
card, visit your bank's ATM, use your mobile phone, visit a Web site or send an
email,” said Charles McKee, Sprint's vice president for government affairs.
“That's why it's such welcome news that the FCC is considering corrections to
its rules that would protect American consumers and businesses from even higher
prices for these high speed broadband connections.”