In oral argument Wed., U.S. Appeals Court, D.C., wrestled with question of how DSL ISP-bound traffic should be regulated, with attorneys from all sides acknowledging debate that fell into series of advanced services issues under Telecom Act that still were working their way through courts and remand process. Some arguments centered on whether DSL-based advanced services should be subject to same unbundling services that ILECs face under Sec. 251(c) of Telecom Act. One apparent area of agreement was that based on same court’s action last year vacating reciprocal compensation order, remand to FCC should have been sought for related issues in order on DSL traffic. In earlier ruling, court cited confusion on definition of ISP traffic, whether it was telephone exchange service, exchange access or 3rd category. In that decision, court remanded ruling, saying FCC hadn’t provided satisfactory explanation of why LECs that terminated calls to ISPs weren’t properly seen as terminating local telecom traffic and why such traffic was exchange access rather than telephone exchange access. On Wed., court heard separate appeals filed by Qwest and WorldCom on advanced services order released by FCC in 1999. WorldCom argued that Commission incorrectly concluded DSL ISP- bound traffic was exchange access and not telephone exchange access. It cited reciprocal compensation ruling last year that held that ISPs didn’t connect to local exchanges for purpose of origination or termination of telephone toll services. “These things are tripping over each other,” FCC attorney John Ingle acknowledged to court Wed. “We think in hindsight we should have asked for a 2nd remand. We do at some level have some embarrassment. We probably should have done that.” Judges David Sentelle, Stephen Williams and Judith Rogers heard arguments. WorldCom attorney Darryl Bradford urged court not simply to remand order but to vacate it. Qwest attorney Jonathan Frankel said Telecom Act didn’t change fact that different rules applied to different services. Unbundling requirements of Sec. 251(c) should apply to LEC based on specific service being offered, not all services that particular classification of telecom carriers offered, he said. Otherwise, “it turns 251(c) into a ball and chain that incumbents carry with them into every new market they enter,” Frankel said. Referring to what he called “fearmongering” in FCC’s brief, he said: “This appeal is about how DSL will be regulated, not whether it will be.” WorldCom arguments hinged on DSL ISP-bound traffic’s being telephone exchange service, not exchange access. Telecom Act forecloses conclusion that ISPs connect to local exchanges for purpose of origination or termination of telephone toll services, WorldCom said. Darryl Bradford, attorney for WorldCom, told court that ISPs provide information service and aren’t telecom providers that are connecting to local exchanges to terminate traffic.
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Women in Cable & Telecom named Olympic gold medal winner Benita Mosley, ex-U.S. Olympics Committee, to new position of pres… Metricom Chmn.-CEO Timothy Dreisbach resigns to become adviser; board member Ralph Derrickson appointed interim CEO… Hispanic TV Network names Emilio Gorriti CEO, promotes Michael Fletcher to COO… Broadwing Chief Administrative Officer Jeffrey Smith adds corp. secy. title… Chris Hardy of Comsearch appointed pres., National Spectrum Mgrs. Assn… Appointments at Lifetime: Trevor Walton, ex-independent producer, senior vp-original movies; Meredith Wagner promoted to exec. vp-public affairs & corp. communications… Adriana Chanos appointed to Nev. PUC to serve 7 months remaining in term of former Comr. Judy Sheldrew and to full 4-year term ending in 2005… Matt Danilowicz, ex-iNews, appointed to head new Avid bcst. group as vp… Clement Chen, ex-Saga Software, named vp-business development, Lockheed Martin Global Telecom.
Neb. bill addressing involvement of local govts. in fiber leasing cleared unicameral legislature’s committee process. Bill sent to floor (LB-827) still would allow local govts. to lease dark fiber to retail telecom carriers, but amendments would require that PSC: (1) Review all fiber leases to ensure rates are market-based. (2) Ban municipalities from using their own dark fiber for providing retail telecom service. (3) Direct that locality’s profits from dark fiber leasing be paid into new Neb. Internet Enhancement Fund to support high-speed Internet access for local govt. agencies statewide. Legislative committees also cleared amended version of universal service bill (LB-389), originally intended to make wireless carriers eligible for state universal service support. As sent to floor, bill now would leave it to PSC to determine which local service providers were eligible to receive state universal service subsidies, but all telecom carriers, including wireless, would be required to contribute to Neb. universal service fund.
Liberty Satellite said it withdrew application, originally filed Aug. 11, for inclusion in National Market tier of Nasdaq. Closing bid price of Liberty Series A common stock has been below $5 since Nov. 20. Nasdaq requires minimum bid price of $5 for initial inclusion.
Ind. House passed bill (HB-1181) to give Ind. Utility Regulatory Commission (IURC) power to directly fine utilities for violating IURC regulations. Impetus for bill grew out of Ameritech’s service quality crisis of 2000. Bill passed House with amendment allowing IURC to levy fines equal to lesser of 3% of an offending utility’s revenues or $2.5 million monthly. Bill originally had set fining cap at 15% of revenue. Utilities have vowed to lobby Senate heavily to further weaken or kill measure, saying they'll face punishment because of Ameritech’s problems. Under current law, IURC must file state court lawsuit through county prosecutor for utility fines.
U.K. Office of Telecommunications (Oftel) is augmenting Internet interconnection requirements under which British Telecom (BT) must offer access to its rivals. Starting Feb. 26, BT will have to offer competitors new wholesale unmetered Internet access product called Single Tandem Flat Rate Internet Access Call Origination -- called ST FRIACO. Earlier version mandated by Oftel conveyed Internet calls to BT’s local exchanges. Updated version conveys them across BT network to operator’s own phone network, Oftel said. Oftel said change would broaden inexpensive, unmetered Internet access in U.K. Last year, Oftel studied interconnection issue in context of arguments raised by BT that it couldn’t supply unmetered wholesale service to tandem switches because increased traffic would overload its network. Recognizing that capacity at main exchanges could be limited at outset, Oftel said it included measures to ensure BT’s network could handle expected influx in Internet traffic. It said new arrangements would allow competitors to BT to offer unmetered Internet access by connecting with BT’s network at its main regional exchanges for flat rate annual fee. Oftel said BT would be required “to take steps to ensure that all reasonable demand for ST FRIACO can be met without limitation” starting in Feb. 2003. Oftel said it would work with industry to create “new interconnection regime” for Internet traffic carried over dedicated IP networks. Oftel Dir. David Edmonds said as recently as year ago that unmetered Internet access wasn’t available in U.K. Last year, regulators required BT to provide necessary services for unmetered Internet access over local loop in response to interconnection dispute between BT and WorldCom.
First month of Congress yielded little progress on what’s seen as biggest telecom task for both Commerce Committees this year -- finding way to increase broadband deployment. “It’s been a very slow month, and a lot of it was scripted during the last session,” said Cato Institute telecom analyst Adam Thierer. “There’s no surprises [so far].” Broadband deployment is to get immediate attention when Congress returns Feb. 26. “We're hearing from our constituents how important this is,” said Hill staffer. But so far lawmakers have continued to push disparate ideas on subject with little progress made on reconciling various bills. In particular, most onlookers are waiting to see new bill expected from House Commerce Committee Chmn. Tauzin (R-La.) and ranking Democrat Dingell (Mich.).
Dept. of Defense (DoD) and wireless industry remain apart on some technical issues regarding how bands occupied by military users could be altered for 3rd-generation uses. Govt. and industry officials, at meeting hosted by NTIA Thurs., emphasized that analyses of bands that could be used for additional 3G spectrum were continuing, with final FCC and NTIA reports due late next month. “We still have a lot of work to do,” Motorola’s Steve Sharkey said. “We have at least an idea of where the paths to move forward are.” Meanwhile, Congressional Budget Office (CBO) raised budget projections for proceeds from FCC spectrum auctions through 2007, with rosier outlook attributed to interest in 3G.
Original C-block bidder Airadigm is awaiting answer to petition for reinstatement of its PCS licenses, which FCC cancelled after carrier missed payment after entering bankruptcy in July 1999. Petition still is pending before agency nearly one month from oral argument before U.S. Appeals Court, D.C., March 15 in litigation involving NextWave, bankrupt C-block bidder that also had its licenses cancelled for nonpayment. Airadigm has pointed out that only similarity between it and NextWave is that both are C-block bidders that entered Chapter 11 protection and missed installment payment for licenses. Because of disparities such as fact that Airadigm is offering service and NextWave isn’t, question is whether 2 carriers potentially could be treated differently by Commission. Proceeding raises complex web of legal issues for FCC, making outcome uncertain, industry observers said. At press time, item on Airadigm petition wasn’t yet circulating on 8th floor. Meanwhile, group of large carriers asked Commission to put off Airadigm decision longer, citing how circumstances had changed since NextWave litigation began.
Cablevision Systems said it added 99,000 cable modem subscribers in 4th quarter, about 7,600 per week, to close 2000 with 238,500 and penetration rate of 11.9%. As it continues to upgrade its plant to 750 MHz capacity, company said, it aims to double its high-speed data customer total to 475,000 by end of 2001. But Cablevision, which originally planned to introduce digital cable service this winter, said it wouldn’t begin deploying digital set-top boxes until next fall because it wanted to bolster its customer support operation first. Plans now call for installing 100,000 Sony digital boxes in subscriber homes by year’s end. In conference call with analysts Wed., Cablevision executives denied that there were any problems with new Sony boxes or their cable plant. “We are technologically ready” for digital, Cablevision CEO James Dolan said. Executives said they planned to roll out digital broadly in 2002. They also expressed strong interest in pursuing expanded relationship with MGM, which just bought 20% stake in Rainbow Media, as well as building PCS business in N.Y.C. area and possibly selling various PCS licenses elsewhere.