Forbearance from Regulation is sought through Verizon’s Petition

            So many citizens might actually want to just file a petition with the government to request to be excused from some of its rules. In a situation where the government is unable to answer within the stipulated time frame, which is a mistake most bureaucracies make, the petitioners can be excused  in just the same way they made the request.

            Forbearance is the telecom exemption being talked about. It is something Verizon has been seeking from the FCC (Federal Communications Commission). Not once but several times. Their most recent trial which covers six significant East Coast markets is quite controversial. The petition deadline was on Dec. 5, 2007. We will find out later about the outcome. If they get what they wanted, it means a lot of telephone, broadband and other communication bills in those markets might increase.

            The procedure for forbearance goes way back to the Telecommunications Act of 1996, which authorises the FCC to effectively cancel any regulation it finds is counterproductive or not needed, without having to look for changes in the law. Here is how it works, it permits the agency to forbear, or refrain, from enforcing regulations if doing so won't harm consumers, competition or the market in general. It was particularly the incumbent operators who discovered that forbearance might be a very good way to get out from what they thought to be oppressive or troublesome rules.

            Immediately they accomplished these, the carriers started filing all kinds of petitions. The carriers will see themselves in the enviable position of essentially having rewritten the law as they wanted once FCC did not reply them within the next12 months, in addition to one 90-day extension. This has happened at best one time, when a political deadlock at the FCC stopped the agency from meeting a petition deadline. This was what gingered Verizon to go ahead in stopping the publication of tariffs, or rates, that it was charging for some high-speed optical-fiber connections.
            Just some few weeks back, on Nov. 30, to be exact, FCC said it was going to look for comments on the forbearance process itself. Though any changes that will be made now will come in too late to actually affect the current petition, which focuses mainly on whether competitive telecom carriers in the six markets should continue to be able to use Verizon's subscriber lines under provisions for so-called cost-based tariffs authorised by the Telecommunications Act of 1996.

            The provisions known as UNE-L (Unbundled Network Elements Loop) rules. They allow local phone companies called CLECs (competitive local exchange carriers) to offer voice service at a competitive price. In addition, they also allow DSL providers such as Covad Communications Group to offer competitive broadband service. In this way, cheap consumer VoIP service will be made possible.

            With this petition, Verizon would be able to charge market rates. In other words what it feels its lines are worth, whether in Boston, New York, Philadelphia, Pittsburgh, Providence R.I. or Virginia Beach, Va. The real rationale for the petition by Verizon is its contention that there already exists a lot of voice competition in the six markets, so enforcing the UNE-L rules is pointless.
            As expected, Covad Communications Group disagreed with the petition.

One of the reasons for disagreeing being that from studies, granting Verizon's petition would increase competitors' costs by $2.4 billion per annum. In the event that the competing carriers passes the costs to their customers, the hit would amount to $10 per household per month. Many other organizations are also queued up in an effort to make their opposition known. The organizations range from companies like CLECs to business groups and then to state regulators.

            The assistant general counsel of Covad Communications Group, Angela Simpson also argues that Verizon's petition makes use of many questionable assertions and statistics. More important, she argues, the very basis by which the FCC evaluates the level of competition is inadequate.

            At the moment, the agency only considers competition in voice services in its decision making. It doesn't say anything on the potentially major impact on competition in broadband services, which also means it keeps VoIP absolutely out of the picture. Just known that inspite of all this, VoIP is still very much in the picture but in another way.

            With the Verizon's petition we know that consumer VoIP services exists which is a proof that there is a lot of competition in the voice market. Even though Verizon has been going after the petition for the past year or so, it has been suing Vonage for patent infringement , thereby trying its very best to destroy the top most consumer VoIP provider. Don't know if there is a regulation that is against having it both ways.