CenturyLink, Verizon Hail FCC Decision to Remove 'Obsolete' Phone Regulations

By Josh Long

The Federal Communications Commission on Thursday voted to relieve legacy phone companies from outdated regulations that it said are no longer needed to protect competition and consumers.

But the agency kept in place certain regulations in the business market.

The FCC’s decision impacts rules that governed the Baby Bell phone companies’ entry into the long-distance market and “equal access” rules protecting standalone residential long-distance service, according to an FCC news release. Incumbents also are no longer subject to a requirement to offer access to their networks for competitive providers of “enhanced services” including voice mail and fax, the agency said.

“We welcome today’s decision to remove some of the archaic rules and regulations that only apply to legacy telephone companies, and have long outlived their original goal of protecting consumers who, decades ago, were dependent solely upon wireline companies for voice service,” said Walter McCormick, president of the Washington, D.C.-based trade association USTelecom, which requested the regulatory relief.

The FCC’s order also granted Verizon and other incumbents relief or so-called forbearance from a rule that has required them to provide for use by competitors a voice-grade channel (64 Kbps) on fiber networks.

CenturyLink and Verizon lauded the FCC’s decision.

“The FCC today took important steps to eliminate obsolete regulations that were out of line with today’s advanced communications marketplace and that burdened only one set of competitors,” said Will Johnson, Verizon’s vice president of federal regulatory and legal affairs. “Removing outdated rules, including the requirement to unbundle a voice channel on fiber networks, will encourage the technology transitions that expand consumers’ access to modern networks.”

While characterizing the FCC’s order as “a good first step,” a CenturyLink senior vice president, John Jones, said “more work needs to be done to remove all regulatory disparity between cable and other broadband and video providers and to provide sufficient funding for remaining obligations to benefit all consumers.”

Ruling Preserves Safeguards in Business Market

Incumbents did not get all the relief they wanted. The FCC denied forbearance from certain obligations, including a requirement to provide affordable voice service to consumers in rural areas.

The FCC also rejected …

… a request by the incumbent phone industry to use contract tariffs for business data services in areas that have not been deemed competitive, according to the news release. The agency also said it kept in place certain safeguards for enterprise stand-alone long-distance service.

The order may have marked a partial victory for CLECs (competitive local exchange carriers) in the business market.

XO Communications, for instance, had opposed USTelecom’s request that the FCC forbear from applying regulations that bar price-cap local exchange carriers from offering TDM special access services and tariffed enterprise broadband services under contract tariffs. USTelecom’s petition, XO argued in an FCC filing, seeks to “bypass” a separate FCC review on special access services by asking the agency “to grant pricing flexibility in all locations regardless of whether there is competition in the provision of the affected services.”

Although its order was not immediately released, the FCC appeared to consider XO’s arguments in denying USTelecom’s request to use contract tariffs.

A number of CLECs did not immediately respond Thursday to requests for comment.