Windstream wants ILECs to price IP-based wholesale special access services fairly

Windstream is not opposed to AT&T (NYSE: T) or any traditional telco's migration from TDM to IP-based services, but it is calling for regulators to ensure that it and other competitors can get last-mile circuits for equivalent prices.

Serving as both an ILEC and CLEC in the markets it serves, Windstream has built out an extensive fiber and copper network, but as it extends its services to more multi-site customers, it can't reach every location it needs to serve by building out its own network.

The service provider says that the FCC should "ensure 'last-mile' facilities, connecting competitors' extensive fiber networks to individual customer locations, do not become an anti-competitive bottleneck or strategic leverage to force dramatic price increases on consumers."

"Despite all of the investments competitive carriers like Windstream make, we also rely to a certain extent on the ILEC's last mile," said Eric Einhorn, senior vice president of government affairs for Windstream, in an interview with FierceTelecom. "It's not possible from an economic perspective to overbuild that infrastructure that was built in a monopoly era."

In particular, Windstream wants incumbent telcos to provide next-gen IP services that will replace lower speed T-1 access lines at equivalent prices.

While Windstream is certainly an advocate of IP-based services and the overall transition, executives are concerned that the FCC needs to make sure that the transition won't affect competition.

"Our concern is if left unchecked, the transition as proposed by the incumbents would be used as a back door to deregulate and as an excuse to hinder competition," Einhorn said. "Our understanding is that the chairman is proposing to tentatively conclude that carriers seeking to discontinue a service used as a wholesale input should be required to provide competitive carriers with equivalent wholesale access and pricing going forward."

By not being able to provide similarly priced services a competitive carrier can offer today via TDM, a small business owner would have to pay for a much higher speed service it may not need to run its business.

One of the fears competitive providers have is if the FCC does not put pricing controls on special access services, it could mean higher prices for small businesses.

"We want to migrate our customers to IP, but we can't do so if the pricing required of a comparable IP offering is multiple times greater than the pricing for the TDM input they are seeing today," said Jennie Chandra, vice president of public policy for Windstream. "That is the case for lower bandwidth connections, which are critical input for communications services used by small businesses and smaller sites of non-profit or government entities."

Windstream's comments come in the wake of FCC Chairman Tom Wheeler citing "Emerging Wireline Networks and Services" as one of the items on its Nov. 21 meeting agenda. Wheeler said the commission will consider a Notice of Proposed Rulemaking, Declaratory Ruling and Order to facilitate the transition to next-generation networks by promoting and preserving the commission's public safety, consumer protection and competition goals. 

"To protect competition, this item includes proposals to ensure that small- and medium-sized businesses do not have the benefits of competition yanked away from them," wrote Wheeler in a blog post. "The mere change of a network facility or discontinuance of a legacy service should not deprive consumers or businesses of competitive choices. That would only lead to higher telecommunications prices that are passed along to consumers."

Besides Windstream, a number of non-profit organizations like Boston-based Children's Trust, which currently uses a CLEC for service, have written to the FCC asking them to ensure they keep the playing field level so they can continue to get services at competitive rates.

"As the FCC works to develop and administer public policy in the IP transition, we applaud efforts now underway to consider how vital entities like ours do not lose their ability to rely on competitive alternatives in the telecommunications market," wrote Suzin Bartley, executive director of Children's Trust in a letter to the FCC. "It is our hope that the Commission will act in the near term to ensure incumbents do not diminish wholesale access needed to make it economically feasible for competitors to establish last-mile connections."

For more:
- see this FCC blog post

Editor's Corner: Wheeler's competition agenda, dark fiber, small cells and permitting dominated Comptel Plus Fall 2014

Related articles:
Windstream asks FCC to investigate AT&T's special access increase proposals
FCC's Wheeler: IP transition is not a license to limit competition
FCC begins special-access data-collection process, but competitive carriers want fair prices
FCC's Wheeler: Competition will drive new broadband speeds, availability

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