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ISP Alliance Responds to Proposed FCC Dereg Rules

Calling for the "marketplace to pick winners and losers, not a regulatory agency," the BroadNet Alliance, a new coalition of approximately 300 national, regional and local ISPs, filed its replay comments today to the Federal Communications Commission's (FCC) proposed deregulation rules that BroadNet members say threaten the financial future of ISPs.

The reply is in the form of a white paper and urges the FCC "not to relinquish its own policies of consumer choice and competition in broadband services in favor of the Bell monopolies." The paper contends that current FCC policies "have ensured non-discriminatory access to the monopoly telecommunications infrastructure and will continue to play a pivotal role in making broadband Internet access available to all Americans."

The agency is currently considering trimming regulations through long-disputed interpretations of the Telecom Act to allow the regional Bell operating companies (RBOCs) to more easily enter the broadband market. Under current regulations, the Bells must make their DSL lines available to their competitors (i.e., BroadNet members).

Cable companies, however, are not required to share their broadband lines. The RBOCs claim the current regulations put them at a competitive disadvantage with cable and are slowing the deployment of broadband over telephone lines.

The FCC proposes to make the changes without altering the 1996 Telcom Act by redefining wireline broadband Internet access services -- whether provided over a third party's facilities or self-provisioned facilities -- as information services, with a telecommunications component, rather than telecommunications services. Information services include such services as voice mail and e-mail, which ride over telecommunications facilities.

If approved, the new rules would effectively mean that ISPs would no longer be able to access the RBOC's regional networks. FCC Chairman Michael Powell has long said the consumer would be most benefited by competing broadband technologies, such as telephone, cable, satellite and wireless, not inter-broadband competition. It's a policy he's been consistent with, even though it has spelled the doom for many broadband ISPs and independent telephone companies, called competitive local exchange carriers (CLECs).

"Narrowband dial-up Internet access and broadband digital subscriber line (DSL) service both utilize the same 'last mile' local telephone facilities," said Maura Colleton, executive director of the Washington, D.C.-based BroadNet. "And now the FCC is proposing to get rid of that? Are they saying that they dont want consumers to have the same benefits and choices to which they are entitled."

Currently, more than 7,000 ISPs serve U.S. consumers, from small community-based providers to national providers who cover all 50 states. Though the retail market is competitive, Internet and broadband service providers remain wholly dependent upon the incumbent telephone companies who control access to that underlying infrastructure.

Without incumbent facilities, ISPs would be unable to provide services to consumers. BroadNet contends that as long as monopolies retain control over that access, regulators must protect the existing right of ISPs to use these facilities.

"Because of forward-thinking FCC decisions, U.S. consumers today enjoy an astonishing array of choices for Internet access and services," said Colleton. "In order to ensure that consumers continue to enjoy those same benefits in the broadband world, we need the FCC to do the right thing and preserve this framework. We must not leave the fate of broadband in the hands of incumbent monopolies."

With Powell's position clear and the White House recently endorsing the FCC deregulation approach, Colleton said the issue now needs to move into the public arena.

"We all know where everybody stands inside the Beltway," Colleton said. "But, this is a consumer issue. Consumers are going to be shocked over the lack of choices if these rules are approved."