December 12, 2004

The New York Times > Technology > Important Rules for Phone Market Face F.C.C. Vote

This is nonsense. The future of phone competition is in the VoIP domain and the rules that the commissioners are arguing about don't amount to a hill of beans 5 years hence. When will the FCC Democrats get over it?

"Officials said on Friday afternoon that the Democratic members of the commission, Jonathan S. Adelstein and Michael J. Copps, have expressed grave reservations about Mr. Powell's proposal. They said the Democratic commissioners have complained to Mr. Powell that the proposed changes would be devastating for phone competition, would lead to significant price increases and would harm small businesses that rely on the services of the rivals to the Bell companies."

This is as it ought to be:

"In the last year, the Bell companies have slowly made significant strides in winning their case - aided by a sympathetic federal appeals court here and by regulators who have long been critical of the requirements that the Bells, in effect, have to subsidize their rivals. The prevailing expectation is that the requirements are ultimately doomed. The only fight is over the time of transition."

To the extent that the Bells have been subsidizing their competitors under rules promulgated by the FCC, the courts have found that is wrong and illegal. Seems to me everyone except the competitors and the large shareowners would agree.

"Both the Bells and their supporters on the issue, most notably Mr. Powell, have maintained that local phone markets are growing increasingly competitive and that there is no longer a need for the incumbent carriers to subsidize their rivals."

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