CenturyLink wants to consolidate ILEC operations in states where it has multiple operating companies

CenturyLink (NYSE: CTL) has asked the FCC for permission to merge some or all of its ILEC operating companies to reduce the number of Study Areas in each state it serves.

In an FCC filing, CenturyLink said that ILECs in each Study Area will initially be able to operate under a single tariff with uniform Transitional Intrastate Access Service, Tandem and End Office Access Service, and Dedicated Access rates (a.k.a. "Transitional Access Rates"), participate in a single statewide Federal access tariff filing, and consolidate their eligible recovery before merging.

If the FCC accepts its proposal, CenturyLink expects consolidations and restructurings will initially occur in connection with the nine ILECs it operates in Louisiana.

"In Louisiana, all nine of the CenturyLink Louisiana ILECs first will consolidate their rate structures in a single tariff by March 2016 and participate in a single Federal access tariff filing on July 1, 2016," CenturyLink said in an FCC filing. "They subsequently will be merged with and into a single corporate entity that will assume all regulatory duties pertaining to CenturyLink's provision of ILEC service in the state."

Specifically, CenturyLink is seeking relief from the requirements of sections 51.907 and 51.915 of the Commission's rules to consolidate and restructure CenturyLink's Louisiana ILECs into one entity. It wants to take similar actions in other parts of its serving territory where these actions will have no adverse effect on wholesale or retail customers, revenue neutral to CenturyLink and not bring a material change to its eligible recovery in each affected area.

By making this change, CenturyLink argues that it can simplify how it serves customers and provide them with potential cost savings.

A business customer would be able to more efficiently evaluate the offerings it needs from just one company entity versus nine.

"Rather than examine nine different tariffed rate sets, customers will need to evaluate only one," CenturyLink said. "This will reduce complexity and speed purchasing decisions. Customers also will no longer have to calculate and coordinate the volume of the services they seek to purchase from nine different local exchange carriers and instead will be able to base their purchasing decisions on their aggregate statewide needs in Louisiana. This will save customers time and free up resources that they can redirect to other pressing matters, including improving their ability to compete."

Additionally, the waiver aims to help CenturyLink improve its own internal operations.

The service provider said that the waiver would enable CenturyLink in Evangeline, La., to maintain a "single Federal access tariff with a single set of Transitional Access Rates in Louisiana rather than the nine separate rate sets that exist today," while enabling "the company to update only a single set, rather than nine sets, of Transitional Access Rates in its billing system."

By streamlining these functions, CenturyLink would be able to dedicate its personnel to focus on improving operations for customers and improving the telco's ability to compete against the growing tide of cable providers and CLECs.

For more:
- see this FCC filing (PDF)

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