Lifting the veil off the rhetoric of old networks vs. new networks

By Chip Pickering, CEO, COMPTEL

Chip Pickering

Debate has been raging on about our public telephone network as it transitions to support more IP traffic. And at the heart of the large incumbent telcos' argument is that they are building "new networks," while competitors seek to maintain the status quo with their "old networks" and "old technology." Nothing could be further from the truth.

In a May 6 opinion piece, "Argument to preserve special access falling apart without government intervention," Bruce Mehlman channels his inner Orwell saying that up is down and black is white. But what this debate is actually about is the large incumbents trying to slow their competitors and stifle innovation by choking off access to customers. If the large incumbents can significantly increase their competitors' cost for last mile access to consumers, the many small and medium-sized businesses that purchase modern, IP-based communications services from competitive providers will see major price hikes and fewer options as some competitors may be forced to exit the market altogether. 

Rather than accept Mr. Mehlman's argument at face value, we need to lift the veil off his rhetoric and truly examine what has been happening in the communications marketplace during the past 10 years. To cut to the chase, the real story is that competitors--through a combination of their own network infrastructure and last-mile connections leased from the incumbents--have been deploying advanced, IP-based technology in their networks longer, and at a faster pace, than the incumbents. While IP is simply a transmission tool through which voice and data can be routed more efficiently across the existing fiber and copper infrastructure, competitive providers understood the benefits of IP long ago and have been using it to offer new, innovative services to customers across the nation for more than a decade.  We led, they followed.    

A fundamental aspect of today's communications law, and a guiding principle for policymakers (I should know, I was in the room as the law was being written), is to ensure a wholesale marketplace. A wholesale marketplace is necessary because it is not feasible for competitors to replicate most last-mile connections. And a wholesale marketplace, in turn, will foster healthy retail competition. The idea was simple; with wholesale protections in place, we can deregulate retail prices and trust competition to keep the big monopolists in check. And boy, did it work. We have seen an explosion of advanced services as a result of the 1996 Telecommunications Act.

This innovation continues today. For example, COMPTEL member companies, such as XO Communications and Windstream Communications, are pushing their IP-based communications networks to the farthest corners of the country, enabling them to provide phone, data, networking and other broadband communications services for businesses. Products and services that we dreamed about in 1996 are now a reality. Still, this doesn't mean that we throw out the pro-competitive principles we adopted in 1996 that led to this revolution. Instead, we need to continue the policies that make the network work: access and interconnection. The experience of our members show that consumers benefit from these choices and the innovation offered by competitors, thanks to the availability of wholesale last-mile offerings.

It's time to lift the veil off the rhetoric. Competitors are leading the way, but the largest incumbents are trying to block this competition. If the large incumbents are able to act outside the law, then consumers across the country will lose.

Chip Pickering became CEO of COMPTEL in January 2014. Pickering was a six-term Republican Congressman, representing Mississippi's Third District. During this time, he served on the House Energy & Commerce Committee, where he was vice chairman from 2002 to 2006 and a member of the Telecommunications Subcommittee. He also was co-chairman and founder of the Congressional Wireless Caucus and an assistant minority whip of the House.