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FCC Appeals Telco Competition Block

Supreme Court expected to consider competition in local telephone service.

By Courtney Schlisserman (Medill News Service), PCWorld   

The agency filed an emergency appeal with the Supreme Court requesting that it dissolve the stay ordered by the 8th Circuit Court of Appeals on October 15. That ruling suspended pricing and contract%dquot interconnection%dquot rules that would have forced local companies to extend discounts and other perks to rivals wanting access to local networks. The ruling also handed oversight of new competition to state regulatory panels.

%dquotWe believe the appellate court%squots decision denies competition ... and would permit a variety of anti-competitive delaying tactics,%dquot said Jonathan Sallet, MCI chief policy counsel. The company, along with AT&T, led 35 telecommunications companies in filing a separate emergency appeal to the court on Thursday. Although the companies were not permitted to join the FCC in its appeal, the court will jointly consider the pleas, Sallet said.

%dquot When the FCC wrote the interconnection rules, it did exactly what Congress prescribed when it passed the Telecom Act,%dquot said Mark Rosenblum, vice president for law and public policy at AT&T. He added that the FCC was asked to overlook pricing in order to bring%dquot competition and customer choice to an industry that has historically been a monopoly.%dquot

Under FCC rules, competitors could lease entire local phone networks at discounts of 17 percent to 25 percent below retail prices charged by the local carriers. Competitors could also lease as many as seven individual components of local phone networks, including switches and directory assistance.

%dquot The stay already imperils--and if left intact, would wholly undermine--Congress%squots strict timetable for ensuring%dquot competition in local telephone markets, the FCC said in its appeal application.

The Supreme Court is expected to decide the issue by the end of next week.