Why RBOCs Believe They Need Regulatory Relief to Offer High
The RBOCs have been screaming for relief of what they believed to be harsh restrictions performed by the FCC ever since the AT&T divestiture took place. For once, the divestiture has taken away RBOCs ability to offer inter-LATA long distance services. The Telecommunications Act of 1996 (TA96) has taken it a step further, by mandating that a Competitive Checklist of 14 items have to be performed before the RBOCs are allowed to enter inter-LATA long distance competition. Included in the list are the unbundling of the ILECs local loop and resale of ILECs service offerings by CLECs at wholesale discounts. The Tauzin-Dingell Bill essentially tries to put an end to such restrictions particularly on inter-LATA data offerings. The Bill, which was backed up by the baby Bells, argues that section 706 of the TA96 calls for deployment of advanced telecom services and the current FCC rules are definitely slowing it down. FCC prescribed requirements on unbundling network elements inc . . .
CLECs claim that the wholesale rates they are being given now are already high enough without the ILECs’ freedom to offer market price for access to their lines. 2 million subscribers, compare with 2. [Dallas News2, 2001] Previously in a Line Sharing Order of November 1999, the FCC adopted rules that the ILECs must share lines with the CLECs for use of voice and data (DSL). The Bill also tries to do away with that requirement, which will be a great disadvantage for the competitors if it is enacted. [ISP Planet, 2002] In response to the ILECs petition, the CLECs propose that data services are kept as subsidiary to the RBOC and that RBOCs’ wholesale is divested from their retail to insure fair treatment. If the Bill becomes law, it will put many of the CLECs and internet service providers out of competition and out of business. It has only been six years since a groundbreaking legislation was passed and in that time, competitive providers who offer innovative and cost-effective services have taken nearly 10% market share away from the Bell companies. lude line sharing and collocation of CLEC’s equipments in the ILECs central offices, which the ILEC say is deterring them from deploying high-speed Internet access nationwide. As in June 2001, cable modem service had 5. Currently, both CLECs and ILECs offer DSL services. From the CLECs’ standpoint, it is much too soon to give the ILECs so much leeway. If they do, it will be at a high cost. The Tauzin-Dingell bill allows the Bells to charge competitor market price for access to their lines with little FCC supervision. Furthermore, with FCC regulated wholesale rates on services they are selling to CLECs, the RBOCs cannot justify the investment needed to upgrade their phone lines to accommodate for high-speed broadband services and someday, even faster data services.
Common topics in this essay:
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