State Regulators Oppose AT&T’s IP Transition Plan

State regulators came out swinging against AT&T’s proposal to eliminate legacy interconnection rules as the nation’s telecom infrastructure moves toward all-Internet Protocol services. AT&T represents its petition as promoting the interests of American consumers, but it’s really just “a transparent attempt to impose the business plan of a single corporation” on “the entire nation,” said the National Association of State Utility Consumer Advocates Monday (http://xrl.us/boc4os). Individual state commissions and associations supported NTCA’s petition, which they said would be a more tempered approach that retains some existing rules to protect consumers. In a blog post Monday, AT&T’s Bob Quinn urged the commission to let it do “trials” of deregulation in various wire centers so the FCC could “capture and address the operational, technical and policy issues that necessarily will arise” as the industry transitions away from time-division multiplexing (TDM) technology.

The AT&T petition “contravenes a fundamental provision of federal telecommunications law,” NASUCA said: making wire and radio communications available all the people of the U.S. with adequate facilities at reasonable charges. AT&T’s petition also ignores the states’ authority over intrastate service, NASUCA said. The petition is “based on a crucial, self-interested error. It asserts that there are two networks, the traditional ‘legacy’ public switched telecommunications network (PSTN) and the new IP network. The truth is that there is only one, mixed, network that is evolving -- as the telecommunications network has continually done -- to use and accommodate newer, more efficient technologies.” There is no need to abandon the principles that have protected consumers for 80 years, NASUCA said, urging “extreme caution” in evaluating AT&T’s proposal.

The Washington Independent Telecommunications Association said it supported NTCA’s petition. “Every regulatory agency should periodically examine its rules to determine whether certain regulations should be eliminated, retained or modified to meet that agency’s goals and objectives,” said the state association of ILECs. By initiating the rulemaking proposed by NTCA, “the FCC will be able to be informed by the parties that are directly affected by current events as to which regulations are important to retain as we move forward,” it said (http://xrl.us/boc4i3). The Public Utilities Commission of Ohio said it “conceptually” supports the NTCA’s approach of “smart regulation,” in which after a “studied consideration” of the existing framework the commission can determine which rules should be retained (http://xrl.us/boc4n3). Ohio “strongly believes” that state commissions should have an “important role in the collaborative process."

AT&T said it was “critically important” to maximize the amount of private capital invested into broadband infrastructure, which could only be done by eliminating legacy obligations (http://xrl.us/boc4ri). As consumers and subsidies move away from the old infrastructure into broadband, “the burden of retaining dual infrastructures is unsustainable,” Quinn said. Quinn cited the National Broadband Plan, which said that if some carriers are required to maintain the Plain Old Telephone System, investments in other assets could be stranded. “To put it another way,” said Quinn, “any dollar spent on maintaining a POTS infrastructure is a dollar not being spent on broadband."

The Free State Foundation supported conducting trials of regulatory forbearance as part of the IP transition process (http://xrl.us/boc4ke). “Dynamic change” from cross-platform competition and IP-enabled technologies “requires replacement of the legacy monopoly system with a market-drive framework,” the free-market think tank said. The new framework should include only regulations “necessary to satisfy basic statutory requirements for ensuring universal service,” FSF said. “A proper focus on ensuring provision of voice services via all-IP networks should result in minimal, targeted regulation while ensuring providers maintain marketplace freedom in offering consumers other IP-enabled services.” A “series of special trials” to assess the impact of deregulatory reforms would help facilitate nationwide retirement of the PSTN, ideally by 2018, it said.