Kaufman Bros. analysts said Mon. that the FCC may be reconsidering its plan to eliminate line sharing as a UNE on a nationwide basis. The change could be reflected when the Commission finally issues its order in its Triennial UNE review on which it voted in Feb. The financial firm said the agency might be planning to defer the issue to the states for decision, similar to the way it treated the switching UNE. Covad wouldn’t comment on the rumor but the company, a big user of line sharing, has been urging the agency to revisit its original action.
Country of origin cases
A Nev. Senate committee advanced a toned-down version of broadband deregulation legislation that also would provide Sprint and SBC with increased pricing flexibility on narrowband voice services. The Senate Labor & Commerce Committee unanimously approved the legislation (SB-400) after amending the bill to delete language that would have denied the PUC any authority over telecom facilities that carried any broadband traffic, regardless of how much. The panel also amended the narrowband deregulation provisions. The original bill set specific threshold criteria that would deregulate service automatically once rates were met. The amended bill would leave it to the PUC to determine whether competition for a service was sufficient to warrant rate deregulation. The PUC already has a docket pending on deregulation criteria. The bill also would amend the tariffing process to specify that SBC and Sprint couldn’t use tariffs to extend term and volume discounts to a specific business customer; such deals would have to be approved by the PUC as a customer-specific contract. Tariffs would have to be used for discounts applicable to all businesses or a specific class of business customer, and the PUC would have to approve such tariffs within 60 days. The bill now goes to the Senate floor.
A federal judge in Cal. struck down the right-of-way (ROW) management ordinance of the City of Berkeley. Judge Susan Illston of U.S. Dist. Court, San Francisco, said the ordinance went far beyond the local ROW management role carved out for municipal governments under the Telecom Act. She was ruling on Qwest’s appeal of the city’s ordinance (Case C-0100663-SI). The ordinance let the city determine which companies were telecom common carriers subject to the measure’s provisions, but the judge said that determination rested with the FCC and Cal. PUC under the Telecom Act, and cities had no authority to determine what was a telecom carrier. The court also said the ordinance imposed a burdensome community interest test and cumbersome procedural requirements for ROW permits that weren’t directly related to actual ROW access management. The city’s original ROW ordinance was stayed but the city was allowed to implement an interim version while Qwest’s court case was pending. The final ruling struck down both the original and interim ordinances.
SAN FRANCISCO -- The contention by a franchisors’ lawyer that cities retain wide latitude to impose fees and customer- service requirements on cable modem offerings became a lightning rod Thurs. for vehement dispute from cable industry attorneys. They argued at a Practising Law Institute cable law seminar that the assertion of city rights by Joseph Van Eaton, who represents cable franchisors, was bad policy and incompatible with the FCC’s classification of cable modem as an interstate information service.
The Fla. PSC agreed to a 4-month delay in the hearing on whether it’s anticompetitive for BellSouth to withhold its DSL services from customers that take their voice service from a CLEC. The delay was granted at the request of the parties to the case. The state’s CLEC trade group said the policy thwarted competition. The hearing originally was planned for Jan. but was delayed to this month. The hearing now will be Aug. 6, with discovery to be completed by July 30. The PSC last June ordered BellSouth to provide its DSL services to voice customers of Fla. Digital Network, but in Oct. the state CLEC trade association asked the PSC to extend that ruling to include all Fla. CLECs and incumbents (Case 020507-TL).
The information technology (IT) and telecom markets are in “reconstruction mode” and investors are just beginning to “come out of their shells,” said Richard Lukaj, pres., Babcock Capital Partners. He spoke at a panel on technology needs of the telecom and IT industry at the International Finance Corp. (IFC) Global Technology Conference 2003 Wed. Venture capitalists have “very much gone back to the basics” in deciding what to invest in, he said. It’s much tougher to find financing for raw, pre-beta (testing) technologies, Lukaj said. However, he said, the woes of the developed IT markets are creating new opportunities for emerging markets.
The House Telecom Subcommittee Wed. approved an amended bill by Subcommittee Chairman Upton (R-Mich.) that would create a trust fund from auctioned spectrum to reimburse federal agencies that vacated spectrum. Upton told reporters after the markup that, based on the support of the Bush Administration, “I'm pretty encouraged by the prospects of this bill.” He said Commerce Committee members would rally together to ensure the bill’s passage, given likely opposition by appropriators. He said he had recently discussed the legislation with Senate Communications Subcommittee Chmn. Burns (R-Mont.) and was confident the Senate would act as well.
Intelsat, in a progress report to the FCC on “its progress toward conducting an IPO,” said its financial advisers continued “to recommend that [Intelsat] delay moving forward with an IPO until market conditions are more favorable.” The company cited 2 extensions it has had since the original IPO date of Oct. 1, 2001, the first from the Commission that moved the date to Dec. 31, 2002, and the 2nd granted by act of Congress that extended the date an additional year. Intelsat said simply that it was making progress toward an IPO by year’s end, “unless the Commission extends the deadline until June 30, 2004, in consideration of market conditions and relevant business factors.” The fixed satellite services (FSS) market is depressed and share prices in the sector have fallen in the last year, Intelsat said: “Only 17 IPOs over $50 million were priced in the 4th quarter of 2002… In that same period, an almost equal number of IPOs were postponed or withdrawn.” It said there were no IPOs in Jan. and that 3 of 4 conducted through mid-March closed below opening prices on the first day. An Intelsat spokeswoman said the company wasn’t asking for an additional extension: “Our plan is to have the IPO this year in compliance with the Orbit Act. There is the potential for an extension to 2004 with Commission approval, but there is nothing in the works right now.”
AOL Time Warner (AOL-TW) asked the FCC to drop some key conditions that the agency had imposed in approving the merger of AOL and TW 2 years ago. AOL-TW specifically asked for relief from a condition that the company not offer advanced services over its Instant Messaging (IM) service, particularly streaming video. It also asked the agency to drop the requirement that the company report every 6 months on its progress in achieving interoperability between its IM service and similar services provided by competitors. The company didn’t seek relief from conditions that the Time Warner Cable systems allow unaffiliated Internet service providers (ISPs) to use the company’s pipes to deliver Internet services that compete with those provided by AOL-TW itself.
The MPAA and its allies agreed to important changes in what they called updates of state cable and telecom piracy laws (CD April 1 p8) but that critics label as harsher versions of the Digital Millennium Copyright Act (DMCA). The changes came in response to criticisms from a variety of quarters. They're incorporated in a new version of a model state law circulating for comments, on a Fri. deadline, among several consumer electronics and high-tech companies, ISPs, telcos and library associations.