FCC Plans Historic Vote

Barring any last minute political maneuvering, the Federal Communications Commission (FCC) is scheduled to vote Thursday morning on the latest effort by the regional Bell operating companies to rid themselves of regulations requiring the Bells to lease some or all of their lines to competitors at reduced rates.

The vote is set just one week after FCC Chairman Michael Powell scratched an open meeting to decide the issue when it appeared he did not have a majority of the five-person panel lined up to support his plan to free the Bells from their current legal obligations under the 1996 Telecommunications Act.

At the heart of the issue is whether the Bells have met their obligations to remove barriers to entry into the local voice market and did the Telecommunications Act anticipate that the Bells would have to share their lines for advanced voice and data services when it was written six years ago.

According to a number of reports, Powell apparently believes the Bells have met that obligation. Since the beginning of the year, he has dropped a number of hints that he supports requiring the Bells to continue to share their copper lines for local voice service but would exempt them from sharing new fiber lines. Powell also supports exempting the Bells from line sharing obligations imposed on them by local public utility commissions.

The Bells support at least some variation of Powell’s plan, arguing the current regulations have put them at a competitive disadvantage with cable companies that are not required to share their lines with rivals. The Bells contend the current rules have stymied investment in new fiber networks and have given the cable companies an unfair advantage in rolling our broadband service. Cable companies currently control almost 70 percent of the U.S. broadband market.

Bell competitors counter that rolling back the rules would effectively give the Bells a monopoly over high-speed broadband services delivered over telephone lines.

Powell’s efforts to get his plan passed hit a roadblock last week when fellow Republican commissioner Kevin Martin floated a rival proposal that appeared to gain the support of the two Democrats on FCC, Michael Copps and Jonathan Adelstein. Martin, appointed by President George W. Bush and a former FCC staff member, wants to give the state PUCs the power to make the deregulatory decisions about the Bells and requires the Bells to continue to provide to their rivals access to high-speed lines.

Martin’s move left Powell with only Kathleen Abernathy supporting him and sent both politicians and lobbyists into another week of frenzied negotiating. A high ranking FCC official told Internetnews last week that “everything possible is being done to make a vote happen this week, but don’t be surprised if it doesn’t.”

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