With only a day until AT&T (NYSE: T) will be allowed to raise the rates competitors pay for middle-mile network access to their COs, the NoChokePoints Coalition, a group formed last year by Sprint (NYSE: S), T-Mobile and Covad Communications to cap these fees, is scrambling to get the FCC to keep the current rates in place. The reduced rates were a condition AT&T had to meet in order to complete its acquisition of the former BellSouth in December 2006.
One group that will immediately be impacted by AT&T's rate increases will be large business customers. According to Colleen Boothby, executive director of the Ad Hoc Telecommunications Users Committee, an increase in these rates could drive up the rates some large businesses pay by 7-8 percent.
"None of [the Ad Hoc members] could announce, three years in advance, a price increase, because they operate in competitive markets," Boothby said. "If they did that, people would flee to alternatives."
In addition to large businesses, AT&T's rate increases will increase the costs that CLECs and mobile operators pay to the ILEC to carry their traffic to the Internet and PSTN. Maura Corbett, executive director of the NoChokePoints Coalition, said that these service providers will have little choice but to pass on those increases to their customers.
Getting the FCC's attention to address the special access issue will be a challenge. While the FCC's Broadband Plan addresses special access reform, the agency's main focus continues to be on net neutrality and reclassification of broadband as a Title II service.
For more:
- PC World has this article
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