CenturyLink sounds off on special access debate, wants cable operators included as competition

Incumbent provider CenturyLink (NYSE: CTL) said it wants to work with the Federal Communications Commission on its proposed changes to special access pricing, but has a few opinions on specific matters set out by the FCC in early May. Those matters include wireless backhaul and the method by which competition in various markets is determined – including cable competitors.

CenturyLink executives met on Monday with the FCC's Office of General Counsel and the Wireline Competition Bureau to discuss their concerns, according to a filing posted Wednesday (PDF).

The provider was particularly concerned about how the FCC evaluates competition in various markets, a key component of special access regulation. According to CenturyLink, those evaluations should account "for services provisioned using unbundled network elements and cable services (especially cable-provisioned Ethernet)," the company said in the letter filed with the FCC.

Special access pricing is a regulatory regime used when providers in certain areas that don't have an established network footprint must purchase wholesale services from a specific incumbent because no other wholesale providers are operating in those areas. Under the rules, the incumbent can only charge a specific rate to companies looking to purchase wholesale services.

The FCC on May 2 issued a Further Notice of Proposed Rulemaking that would update and change aspects of special access regulation, or what the commission now calls BDS (business and data services).

Incumbent providers like CenturyLink, AT&T (NYSE: T) and Verizon (NYSE: VZ) have been vocal about the proposed changes, arguing that the changes aren't necessary and could impact the market.

CenturyLink in its letter noted that cell-site backhaul shouldn't be subject to price regulation and should constitute a separate market.

But it also pointed out that cable operators should get a second look as effective competitors under BDS regulation, saying that "recent revelations regarding cable providers' responses to the Commission's data request show that many cable companies were, in 2013, capable of providing Metro Ethernet service (not what the Commission calls 'best efforts' service) far more broadly than originally thought. This shift has dramatic implications for these proceedings, and the agency must account for the new information in conducting any competitive market analysis."

Comcast (NASDAQ: CMCSA), for its part, felt it would be unfair for the FCC to impose new special access rules on its growing business services wing. "Extending legacy regulatory approaches to the larger parts of the market will absolutely cause new as well as existing players in the market to reconsider their investment plans and investment decisions," said David Cohen, senior executive vice president, during a keynote at last week's TIA 2016 trade show.

For more:
- see this FCC filing (PDF)

On the Hot Seat: Verizon's Silliman on creating regulatory balance for special access, privacy, net neutrality

Related articles:
AT&T, Comcast: Special access market is already competitive
Verizon's Silliman: Special access regulation should encourage competition for buyers, sellers
Frontier says special access changes won't impact revenue, services

Suggested Articles

Advantech announced on Tuesday that it made a new addition to its portfolio of appliances qualified by Versa Networks.

Through a new partnership, Wind River is working with Dell EMC on virtual RAN (vRAN) infrastructure use cases for 5G networks.

Google Cloud buys CloudSimple, which is a startup startup focused on enabling VMware customers move to their workloads to the public cloud.