Customs Duty

After emotional testimony from victims of VoIP- related 911 glitches, the FCC Thurs. ordered VoIP providers to give customers full E-911 service within 120 days. E-911, or enhanced 911, means a 911 caller’s location is transmitted and can be viewed by emergency dispatchers on a screen.

In what some observers described as a “very straightforward” oral argument, a panel of federal appeals court judges considered Mon. whether the FCC should reinstate the NorthPoint MVDDS license application in the 12 GHz spectrum. The judges focused on 2 issues highlighted in the NorthPoint Technologies v. FCC case: (1) Whether MVDDS providers would cause interference to incumbent DBS operators. (2) Whether MVDDS licenses should have been allocated to terrestrial providers, rather than auctioned.

SAN FRANCISCO -- Prominent state regulators with a deregulatory bent pushed at the NCTA convention here for “cooperative federalism,” in which Washington sets most of the few rules on communications services, and states play a strong role in enforcing them, especially consumer issues. Outnumbered on a panel Mon., an Ia. regulator said he agonized over the fates of his state’s many tiny incumbent carriers and their customers in a world with much less protection and subsidy.

SAN JOSE -- An extensive order addressing some issues in the IP-enabled services rulemaking should be ready for FCC consideration at the end of May, Wireline Bureau Chief Jeffrey Carlisle said at the VON Conference “town hall” here with Policy Development Chief Robert Pepper. The order will deal with jurisdiction over and classification of VoIP and “give indications” on VoIP players and regulatory social obligations such as E-911 and disabled access, Carlisle said. He told the audience he hoped the Commission would issue the order in the next several months. But he added that it depended on the FCC’s composition, since Chmn. Powell is leaving this month and Comr. Abernathy is thought likely to depart soon.

LONDON -- British Telecom (BT) should be split up to end the “fundamental” conflict between its duty to its shareholders and its obligation to give rivals access to its network, a competitor said Tues. The Office of Communications (Ofcom), nearing the end of a strategic review of Britain’s telecom sector, has proposed requiring BT to provide “equivalence of access” and make drastic changes in its corporate behavior. But Energis CEO John Pluthero said efforts to resolve BT’s commercial dilemma could end up with the telco owning an entity opposed to its own goals and objectives. At that point, it might as well be severed, Pluthero told the parliamentary Trade & Industry Select Committee.

N.Y. Assemblyman Richard Brodsky (D), who heads a committee that reviews most telecom legislation, said his panel opened an inquiry Mon. into the PSC’s decision to allow a Verizon service quality enforcement program to lapse on Feb. 28 without any replacement. Brodsky, chmn. of the Assembly Corporations, Authorities & Commissions Committee, said the PSC “has walked away from its legal duty to ensure adequate telephone service in this state.” He added that the legislature owes it to the public to look into the situation. Brodsky said preliminary data from Verizon indicates it will miss the target for timely outage restorations for the final reporting period that ended Feb. 28, which could result in a $15 million rebate to customers. But a PSC spokesman said the only thing that’s changed is the automatic penalties: “We're not walking away from anything.” The PSC is continuing to monitor Verizon’s performance through quarterly reports and customer complaints. Earlier this year, the PSC said it believed market forces in N.Y. have become strong enough to be the primary driver for good service quality and decided the time had come to test that belief by ending mandatory penalties for Verizon service quality shortfalls. Verizon took issue with Brodsky’s implication that service quality would plummet absent explicit penalties. A spokesman said Verizon has been steadily improving its service quality for the past several years and the latest data shows it may miss the timely outage restoration goal by only a narrow margin. Under the 3- year enforcement program that expired in Feb., Verizon has had to pay $55 million in rebates to its customers. That was the last in a series of service quality enforcement programs going back to 1997. The PSC will issue its report on the final Verizon reporting period later this month.

Verizon said Wed. it would give merger partner MCI 2 weeks to review an alternative proposal from Qwest, and MCI said it would do so. The development comes a day after a N.Y. breakfast meeting with the financial community in which Qwest officials complained they never received a response to their revised $8 billion bid.

The U.S. Appeals Court, D.C., ruled Tues. threw out most of Covad’s antitrust complaint against Verizon because the alleged misconduct related to provisions of the Telecom Act, not antitrust law. The case is one of several filed by CLECs the past several years alleging that Bell companies violated antitrust laws by not meeting sharing obligations under the Telecom Act. The U.S. Supreme Court ruled in Verizon v. Trinko last year that a similar complaint against Verizon should be addressed through the Telecom Act’s enforcement provisions rather than antitrust suits.

The FCC voted 3-2 to reduce Bell requirements to share unbundled network elements (UNEs). The FCC: (1) Eliminated the UNE platform (UNE-P) as a CLEC entry strategy, although it extended the transition to a year from the 6 months proposed in the Wireline Bureau’s original proposal. (2) Dropped dark fiber loops from the list of elements the Bells must share. (3) Slightly reduced the number of situations when the Bells must share high-capacity loops and transport.

Parties opposed to Verizon’s proposal for a new Va. price-cap regulation system said the plan would impair affordability of rural phone service and allow Verizon to squeeze competitors from the market. In Va. Corporation Commission hearings, local govts., consumer groups, CLECs and the commission staff urged rejection of the plan. Verizon’s proposal would deregulate retail rates for all nonbasic services and set a statewide benchmark rate for basic services at the current highest Verizon rate for the services. In any market rates were below the benchmark, Verizon could increase basic rates up to 10% annually until they reached the benchmark. This would mainly affect rural areas. Verizon would be allowed to reduce intrastate access charges as basic rates rose. The plan also would remove many service quality monitoring requirements. Verizon said its current plan was approved in 1994 when local competition was in its infancy, the World Wide Web was new and wireless was a service for the wealthy. Now, Verizon said competitors have taken 30% of its business and it needs more flexibility to stay whole while meeting its rivals. But the Appomattox County Board of Supervisors opposed the Verizon plan, saying the rate increases would hurt rural customers by impairing affordability of basic phone service and service quality. State Del. Danny Marshall (R) said the plan would harm local economic development efforts of his rural constituents in the Danville area, where local rates could soar. Interexchange carriers said the plan should be amended to require immediate access charge cuts. CLECs said they feared Verizon would increase rates for basic services while cutting rates for competitive services to the point they would be squeezed out of the market. The commission staff said the agency has the legal duty to protect affordability of local service, but under Verizon’s plan, some customer groups may end up paying more for less.