US Telecom says that the FCC's call to mandate that ILECs (incumbent local exchange carriers) provide IP services to competitive telcos at comparable prices to legacy TDM services could actually delay the U.S. telecom industry's migration to all-IP networks.
"The FCC's focus on retail customers is important, and we look forward to working with the commission to ensure that they successfully transition to new and better networks and services," said Jon Banks, senior vice president for US Telecom, in a statement. "We understand the commission's concern with competition in enterprise markets, but given the degree of competitive service choices available, mandates that new services be reasonably comparable to legacy services threaten to complicate and delay the transition without providing any significant counterbalancing benefit."
Being one of the leading advocates of the ILEC community, US Telecom's sentiment should not be all that surprising.
The industry forum's revelations come in the wake of a new proposal from FCC Chairman Tom Wheeler that is designed to protect both businesses and consumers as ILECs migrate more of their networks from copper to fiber and IP.
Set to be discussed at its Aug. 6 open meeting, Wheeler's proposal addresses copper retirement and next-gen IP service pricing.
Under the FCC's proposal, ILECs would be required to provide notice to CLEC wholesale customers that use copper facilities to deliver voice and Ethernet over Copper (EoC) services to business customers. ILECs would also be given the option to retire copper networks and replace them with fiber without prior Commission approval, but only if no service is discontinued, reduced, or impaired.
The FCC has also proposed protections to ensure that ILECs can't jack up prices on next-generation IP services. Competitive local exchange carriers (CLECs) and their SMB customers that depend on lower-speed TDM-based T1 and related services face uncertainty as incumbent carriers prepare to stop offering some of these services.
Both of these issues have kicked off a bitter battle between CLECs and ILECs like Verizon (NYSE: VZ). Echoing a similar sentiment by US Telecom, Verizon complained about XO Communications' requirement to provide one-year notice when the carrier is going to retire copper in a certain area. Verizon said that having to provide such notice will delay their transition to IP and fiber.
Joining Verizon are AT&T (NYSE: T) and CenturyLink (NYSE: CTL), which said in separate filings with the FCC that a recent request by Granite Telecommunications to combine unbundled local circuit switching and shared transport services is not only procedurally flawed, but could also inhibit their transitions to an all-IP network.
- see US Telecom's statement
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