WASHINGTON-A federal appeals court said Tuesday that the mobile-phone industry is so competitive that it does not need access to landline facilities at below-market rates.
“The Federal Communications Commission not only failed to conduct the requisite impairment analysis for wireless providers, but in fact found that wireless growth has been ‘remarkable,’ ” wrote Senior Judge Stephen Williams of the U.S. Court of Appeals for the District of Columbia Circuit. “Although the incumbent local exchange carriers implicitly concede that wireless providers would be impaired if they were denied any access to ILEC-dedicated interoffice transport facilities, they point out that wireless providers have traditionally purchased such access from ILECs at wholesale rates. The data clearly show that wireless carriers’ reliance on special access has not posed a barrier that makes entry uneconomic.”
AT&T Wireless Services Inc. led the charge to have the FCC declare that ILECs are required to charge wireless carriers the same amount they charge landline competitors instead of the “special access charge” they currently charge. Sprint PCS estimated that special access charges are double that of “Telric” pricing-the regulated price ILECs must charge competitive local exchange carriers.
“While we’re still studying the decision, given the limited scope of the FCC’s earlier ruling on UNE transport for wireless carriers, the court’s ruling has little practical effect for the wireless industry,” said an AT&T Wireless spokeswoman.
AWS recently agreed to be acquired by Cingular Wireless L.LC. for $41 billion. Cingular Wireless is a joint wireless venture of SBC Communications Inc. and BellSouth Corp., both of which are ILECs.
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The D.C. Circuit said the FCC must look at the availability of special access before deciding that wireless carriers are so impaired that they must have access to transport at Telric rates.
But this is not the end of the road. State regulators and CLECs all vowed to seek a stay of the decision and ask the U.S. Supreme Court to review the decision.
The battle over access to ILEC facilities is as old as the Telecommunications Act of 1996. The ILECs have never been happy that they had to open their facilities to competition, while CLECs argued that it is just not realistic to believe that all competitors can build their own facilities to every home and business in America.
The FCC voted on the rules in February 2003 in a split decision, but took six months to release the details, setting up the D.C. Circuit appeal by both ILECs that were unhappy to have to share their facilities and CLECs that were unhappy that new broadband facilities would not be available.
The FCC 3-2 split, with FCC Commissioner Kevin Martin leading the charge against his two fellow Republicans FCC Chairman Michael Powell and FCC Commissioner Kathleen Abernathy, was again evident as the agency reacted to the D.C. Circuit’s decision with a forked tongue. Martin, joined by FCC Commissioners Michael Copps and Jonathan Adelstein, said the agency would seek a stay of the D.C. Circuit decision. Powell said the agency would begin to re-write the rules again.