CenturyLink faces skeptical state regulators over deregulation request

CenturyLink headquarters
Image source: CenturyLink

CenturyLink has asked the state of Minnesota to be treated as a competitive telecom provider, rather than an incumbent, saying that at least 60 percent of households in the state have alternative telecommunications services like wireless. But officials aren’t so sure.

The state attorney general’s office told the Minneapolis Star-Tribune that CenturyLink’s petition to be deregulated was missing required information, and that the carrier hasn’t “demonstrated that it has met the competitive criteria set forth” in state laws.

As the “heir” to Minnesota’s older Bell telephone system, CenturyLink voice service in the state has been subject to stricter laws. Taking advantage of recent changes to state law, the carrier filed a petition in late June to be subject to competitive market regulations in all 108 of the exchanges where it operates within the state, “because it serves less than 50 percent of the households and its competitors offer service to at least 60 percent of the households in each exchange area.”

Besides wireless, competitors like Comcast offer voice service to their subscribers in the state.

The office of the attorney general argued in its comments opposing the change that there were other factors to consider in granting competitive provider status to CenturyLink. “Significant questions remain as to the existence of those alternatives on a universal basis – e.g., in all homes, in all parts of the state, etc. Even where such alternatives exist, technological barriers may prevent other technologies from replacing a landline for emergency calls, medical alert systems, medical monitoring, and in many other contexts,” the AG said in its filing (PDF).

Another filing (PDF) by the state Department of Commerce argued that CenturyLink may be drawing its figure of 60 percent coverage by competitive providers from inaccurate maps. "CenturyLink QC's Petition does not acknowledge that marketing maps used by the carriers are unreliable in determining if service is available," the filing read. "All of the wireless carriers have a disclaimer with respect to their coverage maps used for marketing purposes."

CenturyLink’s move in the state of Minnesota reflects the ongoing changes faced by incumbent carriers as traditional POTS (plain old telephone service) is increasingly replaced by newer technologies such as IP-based service and wireless voice. Conversely, regulators’ worries about residential customers having reliable services is also justified.

Verizon, for example, faced heavy backlash in New York and New Jersey several quarters ago when it attempted to replace damaged legacy copper lines in rural areas – such as Fire Island, New York and the Catskills – with a wireless-based service called Voice Link.

For more:
- see this Minneapolis Star-Tribune article
- see CenturyLink’s original petition (PDF)
- see the attorney general’s comments (PDF)

Related articles:
CenturyLink builds challenge to Comcast with IPTV launch in St. Paul, 19 other Minnesota cities
Midco expands Minnesota fiber network via Arvig, adds 4,000 route miles
Frontier cites opposition of Charter-TWC deal as it looks to get Minnesota video franchise