Policy

Roberts Sees Barriers

11/17/2006 7:00 PM Eastern

Washington— Comcast chairman and CEO Brian Roberts last week in Miami appealed to state regulators for help in removing regulatory hurdles that serve to frustrate his company's ability to roll out digital telephone service.

Comcast has staked its future in part on taking phone customers away from incumbent phone giants like AT&T and Verizon Communications. The cable company's deployment of voice-over-Internet Protocol (VoIP) technology has attracted 1 million customers so far, with 8 million more expected to join Comcast's voice-customer base by 2009.

However promising that all may sound, Roberts said in a speech to the National Association of Regulatory Utility Commissioners (NARUC) that ensuring the triumph of facilities-based voice competition over a dependency-based system of leasing lines and gear from phone incumbents was tied to the removal of “significant” regulatory barriers.

KNOCK THEM DOWN

“If anyone in this room doubts that there are still significant barriers to voice competition … yes, there certainly are,” Roberts said. “Ladies and gentlemen, we need your help to knock down those barriers.”

VoIP providers like Comcast are not telecommunications carriers, which, under the Telecommunications Act of 1996, enjoy mandatory interconnection rights with other telecom carriers.

The FCC, having already declared VoIP an interstate service, has yet to establish interconnection rights for VoIP providers.

Cable companies like Comcast and Time Warner have managed interconnection issues by contracting with third-party telecom carriers with legally enforceable interconnection rights. But that is not an ideal solution as cable's VoIP ambitions grow.

“When Comcast first asked one of the Bell companies to interconnect our voice network with their voice network, they said 'No, sorry, you're doing IP voice service on your network, so we don't have to interconnect with you.' That's a barrier to competition,” Roberts said.

OTHER COMPLAINTS

He also bemoaned provisions in federal law that exempt rural phone carriers from the entire interconnection regime; foot-dragging by phone companies on the transfer of phone numbers to Comcast; and FCC rules that effectively require VoIP providers to pay disproportionally into the rural telephone subsidy program.

Lastly, Roberts took aim at an AT&T-backed proposal to overhaul the payment system for the exchange of traffic called intercarrier compensation.

“AT&T has urged that it be allowed to charge a quote-unquote 'market rate' for transit service. But there is no market — a competitor like Comcast has no choice of transit providers,” Roberts said, adding that the AT&T plan would serve to drive up “our cost of connecting calls.”

An AT&T spokesman disputed Roberts' claim.