USTA Blasts Inaction on Phone Rules


The phone industry's chief lobbyist spoke out Monday regarding the Federal
Communications Commission's inability to produce an order enacting changes in
phone-competition rules that were publicly adopted nearly three months ago.

FCC chairman Michael Powell spent the first year of his administration
reorganizing the agency with the intention of improving its work product and
speeding its decision-making. But the controversial ruling Feb. 20, which
splintered the agency's GOP majority, has apparently thrown sand into the

"The failure to act is an abdication of responsibility and is insensitive to
the national interest in immediate, near-term economic growth," said Walter
McCormick, president of the United States Telecom Association, in a prepared

In the decision, FCC Republican Kevin Martin joined with Democrats Michael
Copps and Jonathan Adelstein in refusing to topple rules that allow competitors,
such as AT&T Corp. and WorldCom Inc., to access local Baby Bell networks at
cheap wholesale rates in residential markets. Over the strong objections of
Powell, the three decided to let state regulators make those decisions.

But in a ruling just as big as the phone issue, the FCC agreed to shield the
Bells from network-sharing rules for fiber-to-the-home facilities and for hybrid
fiber-copper facilities that use packet-switching technology. On that vote,
Martin joined with Powell and Republican member Kathleen Abernathy.

As explained by one FCC source, the Feb. 20 vote occurred on a "term sheet,"
which spelled out the structure of the decision in general terms but offered
very few details. Wireline Competition Bureau staff continue to work on a draft
order to which all five FCC members have contributed editorial changes, the FCC
source added.

In his statement, McCormick suggested that paralysis at the FCC was caused by
the inability of Martin, Copps and Adelstein to agree on that portion of the
order dealing with voice competition rules.

"In a business environment where three months is an eternity, the country
continues to wait for three commissioners to translate their decision onto
paper, leaving capital investment, job growth and economic expansion in a vital
U.S. industry indefinitely on hold," McCormick said.

Last month, Abernathy told a group of state regulators the agency was taking
too long.

"We should have a decision out. We don't," she said. "We should not talk them
to death. We all recognize this is a problem."

In her FCC office last week, Abernathy told reporters she was not allowed to
propose changes to portions of the order to which she dissented, indicating that
the slow pace was the fault of Martin, Copps and Adelstein.