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ACA Urges FCC To Reject Key Aspects Of USTelecom’s Forbearance Petition

ILEC Trade Group Has Not Demonstrated Such Relief is Justified

PITTSBURGH, December 8, 2014 - The American Cable Association called on the Federal Communications Commission to reject an effort by the United States Telecom Association (USTelecom) to obtain regulatory relief for incumbent local exchange carriers (ILECs) from providing access to newly deployed entrance conduit and from offering contract tariffs subject to regulatory oversight.  In both instances, the big telco trade group failed to demonstrate that such a significant change in policy would meet the statutory requirements.

"If those parts of USTelecom's petition for regulatory forbearance were granted, facilities-based competition in the business market would fail to develop since competitive local exchange carriers (CLECs) would not be able to overcome the ILECs' existing market power.  Such an outcome is inconsistent with the both the spirit and statutory requirements for forbearance," ACA President and CEO Matthew M. Polka said.

ACA set forth its views in comments filed Dec. 5 with the FCC, which is reviewing USTelecom's requests that the agency forbear from requiring that ILECs share newly deployed entrance conduit at regulated rates and from prohibiting incumbent LECs from using contract tariffs for business data services in all regions.

In its Petition, USTelecom requested that the FCC forbear from regulating the price ILECs charge to share newly deployed entrance conduit.  ACA explained that USTelecom offered no evidence in support of its claims that forbearance "would increase competition by creating a level playing field," that market forces are sufficient "to ensure that the charges for such construction are just and reasonable," and it would serve the public interest by providing "appropriate incentives to invest in new facilities."

ACA added that for ACA members competing with ILECs, USTelecom's premise is incorrect:  The development of robust competition will be greatly inhibited if competitive providers do not have access to ILECs newly deployed entrance conduit.  As the FCC has long recognized, access to incumbent entrance conduit makes a meaningful difference in whether a competitive provider can serve a business customer, which in turn would facilitate the development of facilities-based competition.

ACA voiced its concern with USTelecom's requests that the FCC forbear from applying the rules that prohibit ILECs from using contract tariffs to offer Business Data Services in all regions.

Contrary to USTelecom's claim that the explosive growth of competition has radically altered the whole transmission marketplace, ACA said USTelecom has not demonstrated that sufficient facilities-based competition (namely, irreversible sunk investments) has developed in the markets where the ILECs want FCC relief.

"ACA believes the FCC should reject USTelecom's forbearance requests not only because they are based on conclusory statements and theoretical arguments with no facts but also because they would harm the FCC's effort over two decades to stimulate facilities-based competition among telecom providers," Polka said.

About the American Cable Association: Based in Pittsburgh, the American Cable Association is a trade organization representing nearly 850 smaller and medium-sized, independent cable companies who provide broadband services for nearly 7 million cable subscribers primarily located in rural and smaller suburban markets across America.  Through active participation in the regulatory and legislative process in Washington, D.C., ACA's members work together to advance the interests of their customers and ensure the future competitiveness and viability of their business.  For more information, visit http://www.americancable.org/

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