COMPTEL may be the best funded of the pro-competition associations. We spoke to its two leaders.

by Alex Goldman ISP-Planet Managing Editor [August 26, 2008]

COMPTEL is familiar to ISP-Planet readers. The association dates back to a collection of long distance phone companies that was founded in 1981, when is was known as the Comptetive Telephony association. It is the most active pro-competition lobby in the U.S., an expensive task.

So I contact the association to ask about its advocacy priorities for 2008 and 2009.

The association's vice president of communications, Margaret Boles, connects me with those in charge. Jerry James, the association's CEO, and Matthew Salmon, its president, were appointed to their current roles in December of 2007. James comes from a backbone provider, Grade Communications, and Salmon comes from the law firm Greenberg Traurig and was a Representative from 1995 to 2001. Salmon (R-AZ) was in the House when it passed the Telecommunications Act of 1996, which created CLECs.

The FCC Chairman
There are several issues COMPTEL is addressing now, but one of the most urgent has to due with Kevin Martin, FCC Chairman. There is a tradition that the Chairman steps down when a new president is elected, but Martin, who was the chief lawyer for Bush/Cheney 2000, plans to stay. Congressional Democrats are therefore refusing to allow the Republicans to replace a Republican commissioner (Tate) whose term is up. The result will be an FCC with 2 Republican votes and 2 Democratic votes.

That's not the problem.

The problem is that, according to FCC rules, if there is ever a tie vote, a measure passes and is deemed granted, per section 10 of the Telecommunications Act of 1996. But even that's nor the worst part. Salmon reports that the DC Circuit Court has decided that a measure "deemed granted" is not an actual ruling even though it functions as one, and that COMPTEL cannot challenge anything "deemed granted" in court.

"This seems like it's outside of the rest of American jurisprudence. It's not due process. I don't believe it's reasonable. Have you ever seen a bill passed on a tie vote? Have you ever seen one pass because of inaction? Have you seen a bill pass by default? It's a crazy policy."

So COMPTEL is asking Congress to change that rule.

"We've been telling members of Congress about this, and they seem to be listening," Salmon says. "We're seeing heads shaking on both sides of the aisle on this issue."

Forbearance
Then there's the Omaha problem. The FCC has been allowing ILECs to raise rates in a few areas, such as Omaha, even though there's no real wholesale competition.

There's a bill, introduced into the House and Senate, called the Protecting Consumers through Proper Forbearance Procedures Act. COMPTEL is lobbying for it. It's Dingell's House bill HR 3914 and Inoue's Senate bill S 2469.

I'm surprised to see Dingell leading the fight for competition. Readers of ISP-Planet will remember him as a foe of competition when Tauzin proposed the Tauzin-Dingell bill.

"A lot of members of Congress have evolved," says James.

They now know more. "They are more educated as they have watched the process and the mega mergers over the years. They are interested in making competition vibrant."

Salmon, who is the former member of Congress, points out, "what we intend and what enfolds are sometimes a completely different thing."

Copper is gold
Another issue that COMPTEL is concerned about is the FCC's Fiber Failure. Back in 2003, the FCC said that if the ILECs deployed fiber, they could shut down or even destroy any copper plant.

"If you look around the world, particularly to those nations that are ahead of the U.S. in broadband, you'll see that they required the incumbent to share networks," notes James.

Salmon points out that Japan's successful policy is what was intended in the U.S. with the 1996 act. He notes that there were no subsidies for internet infrastructure deployed after 1996 by the new competitors, whereas the ILECs had copper plant paid for by ratepayers through rate of return regulation. "We see the copper as a natural resource paid for by rate of return regulation," Salmon says.

As to phone companies taking sledgehammers to copper plant, James says that's a problem, but it attracts bad publicity. It's also important to counter the ILEC argument that copper's not profitable and that line sharing doesn't allow the ILEC to recover its costs.

"The fact is," says Salmon, "that once we request usage of the equipment and they have to maintain it, the state commission always gives them a fair rate of return."

Also, building owners may feel it's in their interest to block competition, too, just like the ILEC, but when they do, it's against the rules.

The CoreTel case and reciprocal compensation
This one dates back to an FCC decision made on April 18, 2001. We last covered it on February 12, 2002, in CoreTel Details Twisted Path of Telecommunications Act.

James says that over the past seven years, the court sent the case to the FCC and the FCC failed to act, so CoreTel brought it back to the court.

Yes, the FCC has actually managed to avoid acting for a little over seven years.

"A few months ago, the court refused to take FCC excuses and demanded that the FCC render a formal justification of its decision by November 5, 2008, or they would roll back the clock. AT&T and Verizon and Embarq have all filed their proposals and we're responding to those petitions," says James.

They all want minimal reciprocal compensation, as you'd expect, but there are other slimy dealings in there that might be a surprise.

AT&T is trying to kill VoIP.

AT&T is arguing that minutes carried by VoIP services are the same as minutes carried by copper POTS. Of course, AT&T is not also arguing that fixed wireless broadband plus VoIP should receive USF funds as it is an adequate replacement for copper service. Instead, AT&T wants VoIP to pay taxes without receiving any benefits.

James suggests that the FCC will act as narrowly as possible. "There's no time clock on VoIP; there is a clock on responding to the CoreTel decision."

Pole attachments
The FCC claims it wants competitors to build their own infrastructure, but it's never made this easy. One area that COMPTEL is focusing on in the immediate future is pole attachments.

COMPTEL members are eager to invest but want to pay the same rates as the phone company and want the same timely access.

Builders also need access to building, and there are rules that enforce that access, but, James notes, the ILEC doesn't always obey the rules, so they need to be enforced.

Fair access for applications
Another rule that the ILECs may be violating is in VoIP. While Madison River was sharply punished for screening out Vonage, the record shows that the FCC likes to punish only small phone companies, not large ones.

James is not complaining about what happens when you convert an IP phone call to TDM. Instead, he's worried that many applications that we assume will work over an IP-to-IP connection could be screened by the phone companies, to shut out the little guy.

So is this net neutrality? The problem with the term, James says, is that it has many meanings to many parties. But, carefully worded, a law could allow ISPs to conduct normal network management but also ensure that applications can be delivered.

COMPTEL has set up a website to deliver this very specific message: Free To Compete.

The FCC fails to enfoce its own rules
Enforcement has been an important problem for competitors for a long time. For example, if you could prove that an ILEC had tried to offer your broadband, the legal process could cost you $100,000. Few bother.

Similarly, it's likely that the FCC has not enforced the rules it created when the ILEC megamergers happened. "There's no venue at the FCC for this problem," says James. So COMPTEL is going to state public service commissions. But this will take time.

The future
In the long term, COMPTEL is looking to work with other ISP associations that are active in D.C. and at the state level. The association is talking to FISPA and has spoken with WISPA members.

On issues such as anti-muni wireless bills and on the TV whitespace issue, James articulates one key guiding principle:

"We support applications that give ISPs freedom and help them avoid the ILEC."

— End