Verizon says unbundling 64 Kbps voice channels over fiber will impede copper retirement

Verizon (NYSE: VZ) has responded to a recent filing made by competitive provider Granite Communications opposing USTelecom's petition for forbearance on providing voice-grade channels on fiber loops, saying it could delay future migrations from copper to fiber.

In a filing with the FCC, the telco said that the cost to unbundle 64 Kbps voice channels are high for traditional ILECs to maintain.  

"Unlike the hypothetical costs Granite suggests it might face if the Commission does away with the 64 kbps requirement, the costs of unbundling a 64 kbps voice-grade channel over fiber are real and significant," said Verizon in a FCC filing. "And these costs threaten to impede ILECs from retiring copper and fully embracing superior fiber facilities. Granite, meanwhile, acknowledges it does not even buy standalone voicegrade unbundled loops from Verizon or any other ILEC."

As ILECs decide to shut down these types of services, Verizon said it will continue to offer services if the FCC forebears from the 64 Kbps unbundling rule.

This would include a number of unbundled network element-platform (UNE-P) services that Verizon and others offer today.

"Customers that do still purchase voice-grade only service will continue to have options if the Commission forbears from the 64 kbps unbundling rule," Verizon said. "In fact CLECs that today purchase unbundled voice-grade loops could continue to serve end-user customers by switching to UNE-P replacement services, the same services Granite incorrectly claims forbearance would jeopardize. And in areas where we already have retired copper, Verizon continues to make Wholesale Advantage available."

Verizon added that while Granite continues to build its business by leveraging UNE-P replacement products, "the Commission should not let Granite's baseless claims that its legacy business model is at risk impede its competitors' efforts to modernize their networks free from outdated requirement like the 64 kbps unbundling rule."

Today, Granite has been able to build a sizeable business providing traditional TDM voice to a number of large customers, including national retailers and other business customers.

In September 2014, the service provider surpassed the $1 billion annual revenue mark a number of months ahead of its own forecast.

Granite serves customers through a business model that relies on legacy services and technologies. When the FCC eliminated UNE-P, it found in practice it was not a transitional tool leading to facilities-based competition but instead had become many CLECs' long-term business plan.10 Granite now chooses to rest its business plan on commercial UNE-P replacement products. Granite can make that choice. But the Commission should not let Granite's baseless claims that its legacy business model is at risk impede its competitors' efforts to modernize their networks free from outdated requirement like the 64 kbps unbundling rule.

For more:
- see this FCC filing (PDF)

Related articles:
Granite says ILEC's IP migration shouldn't compromise competitors' voice, data service offerings
COMPTEL, industry orgs ask FCC to protect competition in ILEC IP transition
AT&T, CenturyLink claim Granite's request to combine Section 271, wholesale services will delay IP transition

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