Take Back the Phone System

Reader describes how ILECs make competition laws irrelevant in Washington State. It's all about protecting T1 revenue from cheaper DSL technology.

[Response to Gun Fight at the SBC Corral from August 28, 2001.]

[September 24, 2001]

Dear Editors:

Your most recent article on the monopolizing tendencies of the RBOCs and their attempted elimination of existing DSL competition was very illuminating.

For your information, the utilities laws of Washington State, and perhaps other states, allow for the formation of publicly operated local utility districts governed by locally elected commissioners. Functioning much like a Port Authority, the Public Utility Districts (PUDs) start life by issuing bonds to pay for and take over the local iInfrastructure of a monopoly line utility that's not properly servicing the community.

For our locale, Snohomish County, WA, our power is provided by a public utility district. This is not an option just for rural areas, either. Our utility district serves several hundred thousand customers, the core Boeing assembly plants in Everett, WA, and ironically, Verizon's regional headquarters, also in Everett, WA. Originally, Snohomish County was very poorly served by privately owned Puget Power, which still serves many areas around Seattle. In disgust and desperation, Snohomish County citizens formed the electric power utility district to eliminate the economic strangle-hold that Puget Power had on the county.

No competition
CLECs won't touch this area because Verizon has carefully designed their network to make competitor access to their copper virtually impossible. Most services must utilize Verizon's local network, and their transfer pricing for access services is set artificially high to minimize competition from other service providers. They soak their own ISP and telephony operating companies since they can still extract all necessary profit from the local infrastructure monopoly part of their corporation.

Our answer to Verizon's nastiness here in Washington is very likely to be a similar approach, with the legal taking of their physical plant and the formation of a second utility district for telephony services. Verizon presently operates a telecommunications gulag here with exceptionally poor service, and they are universally disliked by their customers. After 4 months, 20 calls, numerous written requests, and at least 120 hours of our time, we are still waiting for a properly configured Verizon DSL connection for a non-profit we are helping.

Unlike the sham equal access agreements that the RBOCs have structured to heavily favor themselves, the telecom PUD would provide access services on a true level playing field for all telephony and Internet services providers.

While the RBOCs slam the door in the face of CLECs who need additional physical plant build out to deliver services, a PUD would be pleased to serve more of its constituents in that way. Access service pricing would also be based exclusively on cost and access availability based exclusively on demand. The primary mission would be to maximize the availability and reliability of service at minimum cost and the focus would be exclusively on the local service territory of the PUD.

PUD performance is always accountable to the customers/constituents through their elected board of commissioners.

Calling Justice for relief
While I'm loathe to turn to government control for relief, anything is better than the present mess created by the local facilities monopolies and collusive government officials. Here in Washington, our UTC, state legislative oversight, and governor's administration are essentially in Verizon's pocket—very passively allowing Verizon to get away with any outrage. We are now considering getting the Justice Department involved to prosecute those in state and local government who have succumbed to Verizon's influence peddling.

Perhaps you can help spread the word to like-minded individuals who can help beat the RBOCs at their own game by taking away their facilities monopoly underpinnings. Then they can stand or topple on the merits of their "service".

This past week iLaunch Ventures abandoned its efforts to get competitive DSL and analog line telephone service from Advanced Telcom Group on Verizon copper for our Lynnwood, WA location. After a 3-month effort to switch over to ATG, they informed us that our Lynnwood location was served by a Verizon satellite equipment cabinet in our area. We can get DSL ONLY from Verizon there because only the Fujitsu DSLAM used by Verizon (but no one else) is available in that cabinet. Meanwhile, our UTC has proclaimed 'competitive access' has come to our state—an absolutely false claim.

With ATG DSL impossible to deliver in most of Verizon territory, ATG offered to deliver services to our offices on Verizon T1's. While T1's cost Verizon less than $90/mo to operate, they resell to the CLECs at $150/mo (when retail would be $200). By blocking competitive DSL, Verizon can now gouge an extra $150+/mo from prospective CLEC customers for each of their locations.

Regards,

Mark Buse, Managing Partner
iLaunch Ventures, LLC
3600 Smith Avenue, Ste 2600
Everett, WA 98201
Mark.Buse@iLaunchVentures.com