January 22, 2004

The Honorable Michael Powell
Chairman
Federal Communications Commission
445 12th Street, S.W.
Washington, D.C. 20554

Dear Chairman Powell:

We write to urge the Federal Communications Commission (the "Commission") to take immediate action to resolve certain ambiguities and inconsistencies in the broadband portion of its August 2003 Triennial Review Order (the "Order").

During the past several years, both in our legislative initiatives in the Congress and in numerous communications with the Commission, we have stressed repeatedly the importance of developing and implementing a coherent, technologically-neutral regulatory framework to facilitate the accelerated deployment of broadband services to all Americans. Recent studies corroborate our view that a deregulatory approach to broadband services would encourage infrastructure investment, promote the creation of hundreds of thousands of new jobs and improve the lives of all Americans through, for example, enhanced access to education (through remote learning) and health care (through telemedicine).

The Commission took a significant step in the right direction when it finally released its Triennial Review Order in August 2003. We applaud the Commission for recognizing that broadband facilities should not be hobbled by regulations governing traditional telephone components of networks. In particular, the Commission's liberation of fiber and packet-switched network elements from the unbundling requirements of Section 251 of the Communications Act (the "Act") has provided a much-needed impetus to broadband investment, and incumbent carriers have begun to increase broadband deployment in reliance upon the Commission's ruling. Unfortunately, however, a close reading of the Order reveals a number of ambiguities that threaten to undermine much of the progress that the Commission sought to achieve through its decision. In our view, prompt clarification of these ambiguities is essential for wireline carriers to move forward with the work of building out new broadband networks.

First, while the Order clearly provides that unbundling under Section 251 is not required for new fiber-optic and packet-switched facilities, a different section of the Order appears to construe Section 271 of the Act to impose independent unbundling obligations even when elements do not meet the unbundling standard under Section 251.¹ While this latter portion of the Order does not mention broadband network elements specifically, it nonetheless introduces significant uncertainty as to the scope of any separate obligation under Section 271. If the Order is to achieve its intended purpose, it cannot relieve carriers of Section 251 unbundling obligations for new broadband facilities only to reimpose them under Section 271. The Commission, therefore, should clarify, through a grant of forbearance if necessary, that any access obligation remaining under Section 271 does not require the unbundling of individual fiber and packet-switched network elements.

Second, the Order raises a troubling policy concern regarding its treatment of customers in multi-unit premises such as large apartment buildings. The Order suggests that certain unbundling obligations that will continue to apply to broadband network elements used to serve the enterprise or large-business market also will apply to customers in multi-unit buildings.² This result would have the seemingly unintended, yet perverse, effect of inhibiting broadband deployment to urban areas containing high concentrations of less affluent citizens and the small businesses that serve them. The Commission must make it clear that no unbundling obligations apply to new broadband network elements serving customers in multi-unit buildings which are properly classified as mass market rather than enterprise customers. In addition, the Commission must make clear that fiber loops that extend to the basement of multi-unit buildings are included in the definition of fiber-to-the-premises loops and therefore qualify for the relief provided by the Commission for such loops.

Third, the Order does not differentiate with particularity mass-market customers from enterprise customers, even though different regulations apply to each category. As a result, the Order is not clear regarding the regulations that apply to many customers that may fall into one category or the other. This obviously presents a significant problem in planning new broadband network deployments. The Commission should adopt an objective, bright line standard for determining which customers are in the mass market category in order to provide regulatory certainty to promote accelerated deployment of new broadband networks.

For the reasons discussed above, we urge the Commission to expeditiously clarify or modify the Order as the Commission decides various petitions for reconsideration and requests for forbearance. Such rapid action will bring us closer to our shared goal of ensuring that ubiquitous broadband services are available to all Americans.

Sincerely,

cc:  The Honorable Kathleen Abernathy, Commissioner
       Federal Communications Commission

      The Honorable Kevin Martin, Commissioner
      Federal Communications Commission

      The Honorable Michael Copps, Commissioner
      Federal Communications Commission

      The Honorable Jonathan Adelstein, Commissioner
      Federal Communications Commission

¹Review of Section 251 Obligations of Incumbent Local Exchange Carriers, CC Doc. 01-338 et al., Report and Order on Remand and Further Notice of Proposed Rulemaking, FCC 03-36 at ¶¶ 649-667 (rel. Aug. 21, 2003 ("Triennial Review Order").

²Triennial Review Order, ¶ 197 n. 624.