FCC Approves USTA Long-Distance Forbearance Petition

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By Lydia Beyoud

Dec. 17 — The Federal Communications Commission voted 5-0 to release larger telecom carriers like AT&T Inc. and CenturyLink, Inc. from certain outdated and overly burdensome long distance calling regulations. Some consumer protections and other provisions in the regulations were retained.

The goal in eliminating some of the regulations is for carriers to invest in broadband deployment and new services with the funds freed up from supporting long-distance services dating back to the 1980s and 1990s, an FCC official said.

The package of memorandum, opinion and order effectively eliminates “equal access” rules protecting stand-alone residential long-distance offerings, though those services will be grandfathered for existing subscribers. Incumbent local exchange carriers (ILECs) can seek permission from the FCC to eliminate the services if they demonstrate they will be replaced with something else, the FCC said.

The order denied forbearance from obligations to provide voice services to rural customers at affordable rates, and retains a prohibition on contract tariffs for business data services in areas deemed to be uncompetitive. The agency noted it is reviewing those special access services as part of another proceeding, which it said could result in lower prices and greater competition between large and small telecom providers.


Commissioners Mignon Clyburn, Michael O'Rielly and Ajit Pai each dissented in part and approved in part, with Clyburn also concurring in part.

Clyburn's concerns were with prior inclusion of a provision that would have allocated Universal Service funding to voice-only services, rather than being spent on broadband connections. Wireline Competition Bureau Chief Matthew DelNero informed her and the commission during the meeting that the funding provision had been removed from the item. Chairman Tom Wheeler similarly told reporters after the meeting that the provision was very recently dropped from the item since it didn't have sufficient support.

“With the long distance service market very different today than it was then, these rules generally no longer are necessary to protect consumers or competition,” the FCC said in a news release.

The vote on the memorandum, opinion and order responds to an Oct. 6, 2014, regulatory forbearance petition filed by US Telecom (USTA), a trade association.

Industry Praise

USTA praised the vote and said freeing up investment for new technologies and services would allow ILECs to better compete against cable operators in the broadband market, according to an e-mailed statement.

“Today, consumers can choose from among a wide variety of technologies and service providers for voice service, and therefore USTelecom requested this relief last year” in response to Wheeler's calls to identify legacy regulations “that serve no purpose and siphon resources from investment in modern networks,” USTA President Walter McCormick said.

CenturyLink indicated it would continue to push the FCC to remove “all regulatory disparity between cable and other broadband and video providers,” according to a news release from John Jones, CenturyLink's top lobbyist.

Satellite Provisions

The FCC also approved a report and order by a 5-0 vote to streamline its procedures for licensing satellite services, an $87 billion industry. The item concluded that many of the existing Part 25 FCC rules were unncessary, outdated or redundant, Wheeler said in a prepared statement.

The order eliminated 50 rule provisions and updated more than 200 others, the FCC said.

Among the provisions, the new rules seek to deter so-called spectrum warehousing by creating a post-licensing bond requirement that would increase in value over time, starting at $1 million and increasing to $3 million by the end of a five-year deployment period, an FCC official told Bloomberg BNA on background.

The measure is intended to incentivize satellite licensees to surrender their authorizations sooner rather than later if they decide not to meet their deployment requirements, the official said. The new bond wouldn't apply to providers that are merely replacing existing satellites with another, the official said.

“The end result will be faster processing times for satellite space and earth station applications. That means faster deployment of innovative services to consumers,” Wheeler said.

To contact the reporter on this story: Lydia Beyoud in Washington at lbeyoud@bna.com

To contact the editor responsible for this story: Keith Perine in Washington at kperine@bna.com

For More Information 
Text of the FCC's USTA forbearance petition news release is at http://transition.fcc.gov/Daily_Releases/Daily_Business/2015/db1217/DOC-336911A1.pdf.
Text of the FCC's satellite licensing rules news release is at http://transition.fcc.gov/Daily_Releases/Daily_Business/2015/db1217/DOC-336910A1.pdf.


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