Survey: DSL Deployment Hampered by Local Phone Companies

New Networks Institute Wednesday
released the results of its survey on the relationship between U.S.
Internet providers and local phone companies.

According to Bruce Kushnick, NNI executive director, local phone companies
including Bell Atlantic Corp. (BEL),
BellSouth (BLS),
SBC Communications Inc. (SBC)
and subsidiaries Ameritech, PacBell, Southwestern Bell, as well as US West (USW),
and GTE Service Corp. (GTE),
are stifling competition and the growth of broadband services in the U.S.
and under-serving independent ISPs.

“Small and mid-sized ISPs represent almost 46 percent of all online
customers,” Kushnick said. “Based on the findings of the survey, local Bell
companies and GTE are causing serious harm to Internet Providers and their

“This includes not only a loss of revenues for ISPs, but the Bells are also
stifling competition and the growth of America’s digital future,” Kushnick

Kushnick alleges that independent, small ISPs are receiving sub-standard
service from local phone companies across the board.

The survey indicates that only 8 percent of the participating ISPs gave
their local phone company a passing grade on services provided. On a scale
of one-to-ten, ISPs gave local phone companies an average score of just 3.7
percent, representing a failing grade on service.

A Maryland-based service provider said sub-standard service from Bell
Atlantic is business as usual at his ISP.

“We have lost several hundred customers and at least 1,000 man-hours
combating BA connectivity problems,” he said. “We were repeatedly told that
it must be problems with our equipment, even though the same equipment
works flawlessly at our other POPs. We purchased 3 brands of equipment to
test the circuits to prove our point, but it did not do any good. BA said
all of these pieces of equipment must be defective as well.”

“We have had over 100 trouble reports filed with BA in the course of 16
months. The problems were finally cleared up 3-weeks ago after it was
discovered that their smartjack cabinet was defective,” he added. “I was
told by several BA technicians that they’ve had lots of problems with this
particular model of cabinet, and that they have had to repeatedly replace

Sixty-two percent of the ISPs reported phone line problems with their local
phone company, while 57 percent said that they experienced fulfillment
delays on orders placed for advanced services. Just less than half of the
ISPs reported that their local phone company takes several days to repair
disrupted services.

Kushnick said the problems are not geographically isolated or company

“There is a clear pattern of abuse throughout the entire Bell system and
GTE,” Kushnick said. “From Texas to California, New York to Florida the
problems encountered are happening throughout the system and DSL deployment
is being stifled by the local phone companies.”

Of the participating ISPs, 71 percent reported that local phone companies
had lost orders for services. Just less than 60 percent reported that local
phone companies had “slammed” ISP c

ustomers into their services, an illegal
method of operation whereby phone companies switch services without
customer’s permission.

According to the ISPs polled, 53 percent had their customers told by local
phone companies that if they switched their services to the phone company
product, they would not experience the line problems they were having.

A small southwest Texas independent ISP that did not participate in the
survey, but concurs with the report findinga. The ISP owner did not want to
be named for fear of retribution from his local phone company.

“The local phone company has missed installation dates and placed 90-day
moratoriums for PRIs, T1s and other circuits for us while they rolled out
the same services for their company,” the ISP owner said. “They have added
new services like DSL access in advance of their promised dates, while
failing to provide DSL services to competitors.”

The NNI report concluded that local phone companies have frozen independent
ISPs out of the DSL market by offering their high-speed services for less
that they charge the ISP for DSL connections, or they simply don’t provide
the DSL service to ISPs at all.

ISPs that connect to competitive local exchange carriers reported that the
CLECs delivered better services but that they too, were hampered by local
phone companies’ sub-standard services. CLECs received a better than 7
percent satisfaction rate from the ISPs surveyed.

Kushnick said the majority of ISPs that turned to regulators for relief from local phone company abuse receive no
results from their complaints filed.

“Almost 75 percent of ISPs have attempted to get help from their state Commissions
regarding their problems with the local phone company,” Kushnick said.
“However, 63 percent of those ISPs who approached Public Service
Commissions to get help, got no results.”

Kushnick is calling on the Federal
Communications Commission
and state authorities to investigate local
phone company operations as it relates to serving independent ISPs.

“With 89 percent of ISPs believing and documenting that they are being
harmed, NNI believes that the FCC and the states should immediately
investigate the ISP’s claims of inadequate customer services and
anti-competitive practices by the Bells and GTE, ” Kushnick said.

NNI acknowledges the ISP survey was conducted using a random mailing to
U.S. Internet access providers by the United States Internet Service Providers

Kushnick said the report may be self-serving, however findings by the FCC
and the Department of Justice
corroborates the serious problems facing ISPs when it comes to deploying
advanced Internet services through their local phone companies.

NNI was founded in 1992 to independently investigate how the break-up of AT&T Corp. (T) and
the creation of “Baby Bells” would the impact the public. NNI has completed
several comprehensive research projects and has initiated class-action
suits in several states against the local phone companies.

Kushnick is the author of The Unauthorized Bio of the Baby Bells &
, an expose written about Bell business practices.

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