CenturyLink gets regulatory relief in New Mexico with mid-sized carrier status

CenturyLink (NYSE: CTL) has overcome another regulatory hurdle as the New Mexico Public Regulation Commission (PRC) ruled that the telco now qualifies under the "midsize carrier" designation.

According to New Mexico law, a mid-sized carrier is one that serves less than 375,000 access lines in the state. Under the mid-sized designation, CenturyLink QC, which is the name it designated to Qwest after purchasing the telco in 2011, will have to abide by the same regulations as Windstream, the state's next largest service provider.

The PRC said this level of regulation is less stringent than CenturyLink QC's current regulation, which requires a commission case to be decided every few years.

Valerie Dodd, vice president and general manager of CenturyLink in New Mexico, told Albuquerque Business First that by being able to operate under a relaxed regulatory framework, it's in a better position to expand broadband to more parts of the state.

"The less regulated we are, the more we can invest in broadband," Dodd said.

Commission Chairwoman Karen Montoya (District 1) said in a statement that the ruling will help drive more economic development in New Mexico. "I want to help reduce costs to consumers and help promote economic development here in New Mexico," Montoya said. "I feel this decision today will do that."

However, District 3 Commissioner Valerie Espinoza, who cast the lone dissenting vote, said that besides compromising the quality of service and reliability of service, the decision could potentially stifle investment in the state's rural areas.

"The Commission should be protecting consumers, not enabling a utility to have the ability to design their own rate, and issue no further penalty credits. We are not only compromising the quality of service, but reliability, as well, and much needed investment in rural areas," Espinoza said in a statement. "My vote against relaxed regulation stems from my grave concern for our ability to regulate the quality of service and costs. CenturyLink was, unfortunately, successful in no longer having to produce monthly performance measures, and limited their requirement to only once per year versus once a month. The Attorney General, the Department of Defense, the City of Albuquerque all intervened against giving CenturyLink the status of mid-size carrier."

New Mexico is just one regulatory feat that CenturyLink has overcome in recent months. In March, the FCC granted forbearance on dominant-carrier regulation related to its packet-switched and optical switching services, a move that competitive groups like Comptel say could set a dangerous precedent of jacking up wholesale rates for CLECs.

For more:
- see the PRC release (.pdf)
- Albuquerque Business First has this article

Related articles:
CenturyLink forbearance ruling could set off competitive dogfight
IP transition shouldn't be a license to price gouge CLECs, business customers, says Windstream

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