AT&T Withdraws Special Access Tariff Filing, Plans to Refile with More Evidence
AT&T withdrew an FCC tariff filing to eliminate long-term special access contracts, it told the agency. The telco plans to refile “with additional supporting material to address some of the feedback that we've already received from the commission,” a company spokeswoman told us Wednesday. The new filing will come “very soon,” she said. Some observers speculated that AT&T’s original filing might have been a way to test the agency’s response. The FCC suspended the tariff filing last month, having found in an order that there were “substantial questions” on whether AT&T’s revision -- which eliminated long-term discounts -- was just and reasonable (CD Dec 10 p1).
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There was some speculation that the whole reason AT&T filed its tariff revision in the first place was as a “probe” to see what resistance it might find from the agency, said Harold Feld, Public Knowledge senior vice president. “I think what really happened here was the agency said, ‘There aren’t going to be shortcuts in this process. We've got to think through all of the implications; this isn’t going to be like it was under the Republicans where you have a little forbearance here, you have a little proceeding over there.’ The FCC realizes this is a big deal."
The special access proceeding needs to be looked at in the context of the IP transition, said Scott Cleland, Precursor Group president and chairman of NetCompetition.org, with members including AT&T. Companies can’t keep relying on copper DS1 and DS3 lines, even though they got a “great regulatory deal” through special access, he said. “Businesses need to start investing in modern technology and not depend on 1996 infrastructure."
Look for AT&T to negotiate a different approach with the Wireline Bureau, which it would then refile, said a CLEC lawyer. Presumably the new approach wouldn’t result in significant rate increases, he said. There are plenty of ways to do that, he said: AT&T could eliminate the long-term contracts but keep offering the discounts; or it could offer replacement ethernet for the same price as DS services. “To us, it’s the appropriate way to do this,” he said. If AT&T wants to change the way it offers DS1s and DS3s, it shouldn’t be able to do so in the way it originally proposed it, with such negative ramifications for end-users, he said.
"I'm surprised AT&T forced the FCC to go through the suspension process before it withdrew the tariff revisions,” said Colleen Boothby of Levine Blaszak, who represents enterprise purchasers of special access services. “AT&T made a lot of unnecessary work for the commission, which has no resources to squander.” If AT&T really does plan to address concerns, that could be “good news” from an enterprise customer’s perspective, she said. “All the tariff change did was push up prices, for end-users and emerging competitors. The competitors may still be dependent on the ILECs’ networks, but at least they create some market pressure on the ILECs to behave reasonably, at least when the regulator is looking."
Sprint met with an aide to FCC Chairman Tom Wheeler Tuesday to discuss AT&T’s planned elimination of its longer-term special access discounts. “The special access marketplace is broken,” with AT&T and Verizon controlling an “overwhelming percentage” of the market across the country, Sprint said in a slide presentation (http://bit.ly/KyoexA). AT&T and Verizon have been able to use their control over last-mile facilities to “maintain their dominant status,” Sprint said. CLECs like Sprint are at a “huge disadvantage” because they must buy special access from AT&T and Verizon, it said. “Supra-competitive rates and anticompetitive terms and conditions undermine competition.”