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U S West: FCC Policies Impede Equal Access

Marking the third anniversary of the 1996 Telecommunications Act regulating open competition of telecommunications technologies, U S West president and CEO Solomon D. Trujillo said that the 1996 Telecommunications Act is not working as Congress intended.

In a speech made at the Economic Strategy Institute's America's Broadband Future forum in Washington D.C. Thursday, Trujillo said that "FCC policies are limiting new services and choices for most consumers, and acting as a roadblock that is keeping millions of Americans off the Information Superhighway."

Trujillo said FCC rules that intended to move the telecommunications industry from a regulated environment to a free forum of open market competition have discouraged investment in rural areas of the U.S. and encouraged competition by new local phone companies only in the high-margin metropolitan business market.

"What should have been rules of transition to speed full market competition have become their own barriers and created a regulatory and legal morass that has blunted the intent of the Act," according to Trujillo. "The result has been to restrict data access, limit long-distance competition and prevent the formation of an adequate Universal Service Fund. "

"The 1996 Telecommunications Act was passed with admirable intentions, but it just hasn't worked out for consumers," said Liz Fetter, vice president and general manager, Consumer Services Group, U S West.

"Competitors are out there all right, but all they want is the low-hanging fruit - low-cost, high-margin business accounts. Few residential customers or businesses in rural areas and small towns are being served by new competitors in today's marketplace.

"It's time for Congress to take the necessary steps to ensure the exciting benefits of high-speed Internet access are spread across the entire population, not just large businesses in urban areas," said Fetter.

Trujillo told the Economic Strategy Institute that the FCC must allow companies like U S West to carry data services across invisible boundaries known as Local Access Transport Areas (LATAs) in order to ensure that all consumers receive the benefits Congress intended when it drafted the telecommunications act.

According to Trujillo regulators need to open nationwide long-distance services to competition. "Opening the long-distance market to competition would do more than any other single act to improve the economics that support the rapid deployment of high-speed, broadband services to all customers, not just big business," Trujillo said. He added that while the Telecommunications Act explicitly intended to open this market, three years have gone by and, "still no incumbent local phone company can offer customers long-distance service. As far as the FCC is concerned, the answer is always the same, and the answer is always 'tomorrow.'"

Additionally, Trujillo noted that the FCC has failed to establish an adequate Universal Service Fund (USF). Congress intended for there to be a USF to maintain affordability. Trujillo said the FCC's failure to follow through on the intent of lawmakers means that it will be impossible for less populated states to fund their own USFs without compromising affordability.

For the most part, the FCC has failed to take regulator action on broadband issues because the commission views the last-mile delivery problem as a short-term issue. In theory, the FCC believes that infrastructure technologies including cable modem access, digital subscriber line services on existing copper, satellite and terrestrial or wireless services will develop to universally serve the Internet's growing need for accessible bandwidth.

Trujillo added that in the three years since passage of the Telecommunications Act, the FCChas made a mockery of Congress' original goal of encouraging telecommunications competition and benefiting all consumers. "In an economy that is increasingly based on information technology and services, the FCC is threatening to create a nation that is half-connected to the information highway and half-rejected," said Trujillo.

U S West provides wired and wireless telecommunication services delivering data networking, directory and information services to more than 25 million customers nationally in 14 western and midwestern states.