FCC Releases Order Removing Unbundling, Resale Requirements for Price Cap ILECs

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Over the dissent of Commissioner Jessica Rosenworcel and the partial dissent of Commissioner Geoffrey Starks, the Federal Communications Commission (FCC or Commission) has issued an Order granting the remaining requests from USTelecom’s May 2018 forbearance petition.  The Order relieves price cap incumbent local exchange carriers (ILECs) from complying with two requirements originally established under the Telecommunications Act of 1996: (1) a requirement that price cap ILECs offer competitive local exchange carriers (CLECs) “analog voice-grade copper loops” on an unbundled basis at regulated rates; and (2) a requirement that price cap ILECs offer legacy services for resale at regulated rates.

According to the FCC’s majority, the public interest was no longer served by maintaining the legacy regulatory obligations referenced above, as “sweeping changes in the communications marketplace” had made such requirements obsolete and an unnecessary cost.  This was so, the Commission explained, because of “the increasing migration of consumers of all sorts and sizes away from TDM technology, copper loops, and local telephone service toward newer, any-distance voice service over next-generation wireline and wireless networks and the wide range of competitors offering facilities-based voice service alongside over-the-top Voice over Internet Protocol (VoIP) services.”  The Commission did not, however, believe that it would be appropriate to remove these ILEC requirements quickly and instead conditioned the agency’s forbearance on an “appropriate transition period” to facilitate a seamless move to alternative voice service arrangements by end users that still rely on legacy TDM voice service.

The FCC’s Order became effective on its release date of August 2, 2019.

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