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AT&T loses Another Court Decision
California Public Utilities Commission
determines AT&T charged excessive Wholesale Rates June 13, 2010
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 The Public Utilities Commission of California approved a wholesale rate order on July 8th, 2010 that relieved CLEC XO Communications of over $1.5 million of excessive AT&T charges. This was the second major setback for big Bell ILECs in recent weeks. The other decision was issued by the FCC on June 22nd. In that decision, the FCC ruled that there was insufficient telecom competition in the Phoenix, Arizona market to justify total deregulation. Both decisions affect the critically important wholesale telecom market. Without a level playing field in the wholesale market, CLECs experience price squeeze and consumers don’t have true market based competition.
In the California case, AT&T had argued that the charges for connecting a wire from one rack to another rack in the same building (cross-connects) could be as high as $600/month. XO, one of the largest CLECs in the nation, complained to the California PUC pointing out that AT&T’s internal charges to itself for these types of connections were zero. AT&T had effectively set up a tollgate that substantially increased competitor’s costs and thus had a chilling effect on telecom competition. Administrative Law Judge, Karl J. Bemesderfer commented that permitting AT&T to charge XO $600/month for “0 mile transport” would completely “frustrate” established FCC policy designed to promote telecommunications competition. The PUC opined that if the FCC had intended for ILECs to charge CLECs for cross-connection in this manner, surely it would have said so. The California PUC relied on the FCC’s Collocation Cross-Connect Order, which was designed “to put the collocator in position to achieve the same interconnection with competitive LECs that the incumbent itself is able to achieve.” These recent victories give CLECs hope that the FCC will take aggressive action this year to reform wholesale rates in a “special access” proceeding. A workshop has been scheduled at the FCC on July 19th to discuss the process such a proceeding should take. For further information, contact Pamela Arluk or Margaret Dailey at the FCC’s Wireline Competition Bureau at 202-418-1520. To encourage participation from a wide variety of interested parties, the FCC roundtable can be viewed live or replayed later by visiting http://reboot.fcc.gov/live/. During the event, the public can submit comments and questions by emailing livequestions@fcc.gov. Further details can be found on the workshop website at http://reboot.fcc.gov/workshops. Additionally, interested parties can listen to the workshop via telephone by calling the following audio bridge; please note, however, that capacity is limited to 49 ports: Number: 1-866-566-7390 Participant code: 473281 |
