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FCC Abandons Linesharing, Kills DSL Competition 612

raygundan writes "According to Reuters, the FCC today decided to greatly curtail the laws that force incumbent phone companies to share their lines with their competition at cost. This does not bode well for companies like Covad Communications who provide DSL using phone lines to bridge their data networks over the "last mile" to customers. The new rules do force line sharing as long as companies are willing to offer voice service, but this essentially states that if you are not already a phone company, you cannot offer DSL. The existing rules will be phased out over three years. There is still some hope, however, that a federal court might strike down the FCC ruling. Oddly, the news agencies seem to be reporting this as a minor change to the rules, rather than an end to all non-ILEC competition in DSL." The FCC's front page has links (luckily PDFs as well as Microsoft Word files) about the decision, including statements from each of the commissioners.
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FCC Abandons Linesharing, Kills DSL Competition

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  • by B3ryllium ( 571199 ) on Thursday February 20, 2003 @03:11PM (#5345844) Homepage
    It's times like this I thank GOD I'm a a secret agent man.

    Erm, I mean, a Canadian.
    • (and I bet no one even laughs at my Devo parody, because of that silly little typo. Ah well. Stress relief paintball [beryllium.ca]!)
    • I was just about to say the same thing, then I remembered that I'm not a Canadian.

      I do however live there as a non-Sympatico customer, so if this madness ever hits us I guess it's back the old blanket and smoke signals. (I'm pretty sure there are bylaws prohibiting that as well)

    • Erm, I mean, a Canadian.

      So what are the Canadian requirements on ILECs concerning CLECs (line-sharing, colocation, etc.), non-carrier ISPs, etc.? I went to the CRTC Web site [crtc.gc.ca], but none of the "Statutes and Regulations" appeared to address that, and there are a ton of "Decisions, Notices and Orders" but I'm not going to plow through all of them. (Even a Google search for canadian regulations CLEC line-sharing turned up a pile of stuff the first items of which didn't seem to directly address the question.)

  • Beautiful (Score:5, Funny)

    by sawilson ( 317999 ) on Thursday February 20, 2003 @03:12PM (#5345862) Homepage
    I'll start dusting more places on the bench off
    for the inevitable flood of layed off tech
  • by Esion Modnar ( 632431 ) on Thursday February 20, 2003 @03:13PM (#5345869)
    What else is for sale?
  • by Kenja ( 541830 ) on Thursday February 20, 2003 @03:14PM (#5345877)
    Go crazy?

    Bottom line is if they do this they'll have a Jolt crazed tech geek attacking their office with a Nerf(tm) crotch bat. I need my Speakeasy DSL service.

    • Kiss it goodbye and place a call for a cable modem. With this ruling, the owners of the lines (the Baby Bell's) do not HAVE to lease their line's to any other companies. Thus removing the thing that STARTED the proliferation of DSL in the first place, and eliminating any competition to the Telecoms. You want DSL, get it through a Baby Bell. No other options.

      This of course means that DSL can have the same restrictions put on it that cable does (no incoming requests, no servers, no static ips), which I'm sure will benefit "fighting terrorism", 'cuz we all know that terrorists run their own web servers from home via DSL.

      *sigh* Anyone in the Michigan area want to share-lease a T1?
  • Here in the uk... (Score:5, Informative)

    by Neophytus ( 642863 ) on Thursday February 20, 2003 @03:14PM (#5345879)
    It is all done over the phonelines, but there many many DSL companies competing (although only a few get mainstream attention). The competition gives the 'hardcore' internet users much choice, but in the end the DSL network is all owned by BT.
  • DSL. (Score:5, Interesting)

    by garcia ( 6573 ) on Thursday February 20, 2003 @03:16PM (#5345905)
    ok, so what did line-sharing do for me anyway? I am in, what I consider to be, a large suburb of Minneapolis. We have about 60k people. I was unable to get QWest DSL b/c I am over 8 miles from the CO (don't ask me how).

    My two other options were (ATTBI which is now over $60 w/o CATV, or IDSL through IIRC Covad for $90).

    So what did it do for me? Nothing. I am still stuck with a service I am not entirely pleased with (the speeds are fine, it's the price increases and the conversion to Comcast that I am not happy about).
  • Interesting (Score:5, Interesting)

    by ShavenYak ( 252902 ) <`ten.retrahc' `ta' `3htimsb'> on Thursday February 20, 2003 @03:16PM (#5345907) Homepage
    If I understand correctly, all Covad (or whoever) would have to do is offer voice and it wouldn't be a problem. Surely they could slap together some kind of VoIP thing and offer it to their DSL customers, then BellSouth would still have to share.
    • Re:Interesting (Score:5, Interesting)

      by Telastyn ( 206146 ) on Thursday February 20, 2003 @03:23PM (#5346002)
      Hell, it doesn't even have to be working, just offered. Just the offer of local phone service for some outrageous fee should be enough to require sharing.

      The Bells have been dicking people around for ages, why not return the favor?
    • Re:Interesting (Score:2, Informative)

      by Dr.Enormous ( 651727 )
      Rivals would still be able to lease access to an entire phone line, but at a costlier rate than just leasing the high-frequency portion used for DSL. The lower frequency on the copper wire carries voice calls.

      This seems to indicate that you're right, but you'll also end up paying a good bit more for it. Unless I'm misreading...
    • Re:Interesting (Score:5, Informative)

      by raygundan ( 16760 ) on Thursday February 20, 2003 @03:31PM (#5346080) Homepage
      I don't know all the details for sure, but the two folks I know at Covad are saying that it can't be VOIP or VoDSL, it has to be traditional voice service. The way the FCC's crack-addled thinking goes is something along the lines of "why should Covad be allowed to sell only the GOOD half of the phone line? let's force them to pay for the crappy half, too!"

      Never mind that the crappy half is already strung to every house everywhere, and the running redundant phone wires is both wasteful and counterproductive.

    • Complain to the FCC (Score:3, Informative)

      by silentbozo ( 542534 )
      Here's my comment to the FCC (you can submit comments at http://gullfoss2.fcc.gov/ecfs/Upload/ [fcc.gov].) Hell lot of good it will do, but I'm writing my congressman and senator, and whoever the hell else I can get to listen to me.

      Is the FCC trying to encourage or destroy competition in the telecommunications industry? Based on the decision to relax line-sharing rules, I'd say that the FCC is trying to quash the last vestige of competition in broadband, and turn it all over to the baby bells, who have systematically tried to exploit their position as local monopolies to shut out competitors.

      In case you haven't seen this is what your gift to the bells is being called on Slashdot (www.slashdot.org):

      "FCC Abandons Linesharing, Kills DSL Competition"

      As a Covad subscriber for several years, I agree with them. I know for a fact that Covad pays MORE for the local loop they lease from Verizon, than I do for my home telephone (they're on separate lines, I'm not using that ADSL on the same line as my regular phone as most folks do.) Couple this with the fact that I can subscribe to a phone service over DSL (www.vonage.com) for an additional $25, and the requirement that a company have to provide both voice and internet in order to lineshare is ridiculous. COMPETITION IS ALREADY HERE - and up until today, it was driving a healthy growth in businesses across the US.

      Although I get my local loop from Covad, I get internet access via Speakeasy (www.speakeasy.com). Couple that with regular telephone access via Vonage (www.vonage.com), and I have everything your decision is supposed to encourage. However, the consequence of your decision today gives Verizon (in my area) back their monopoly on voice and data, and destroys these three other businesses. A monopoly, I might add, which in the past has refused to allow number portability, DESPITE my paying a "number portability fee" for many years.

      In summary, a data provider need not provide voice for there to be voice competition - all they have to do is provide a high speed connection, and voice competition will use that route to compete (as they already are, for both long distance and local service.) By giving the baby bells the decision they wanted, you have destroyed not only the broadband competition, but also the voice competition that relied on that broadband being available. Why would I subscribe to Vonage, if I used Verizon DSL (which requires that I have Verizon voice service)? I WOULDN'T. Whereas, with Covad, which runs their own loop WITHOUT voice, I can order whatever kind of voice service I want, given enough broadband bandwidth. Just so you know, I pay more for service through Covad/Speakeasy, but their quality of service is justifiably better.

      If you doubt that the market has formed the correct impression of your decision (FCC kills broadband on behalf of the baby bells), take a look at Covad stock (COVD): A drop of 39.85% in ONE DAY. Making line-sharing available only to providers that also sell voice is silly and unnecessary, and frankly, incredibly stupid.
  • by Orne ( 144925 ) on Thursday February 20, 2003 @03:16PM (#5345908) Homepage
    This ruling is extra notable because Powell, the FCC Chairman, publicly disagrees [yahoo.com] with their decision: "An FCC chairman has not dissented from a high-profile FCC ruling for roughly 15 years." Powell was a very strong proponent for deregulation, and it seems this time around, state regulators and Bell want the status quo.
    • Requiring companies to lease their lines at cost is *REGULATION*, not deregulation.

      Deregulation is letting those who own their lines lease them at the prices they want to, or not at all. See any regulations there?


      Best example is the California power system "deregulation" that caused all those blackouts - what was billed as "deregulation" wasn't deregulation at all - just a different set of regulations that turned out to be much, much worse than the old set.

      Point of the matter is you should not trust anyone's opinion on what deregulation will do if they do not even know what deregulation is in the first place.

        Let's get this straight. Line sharing doesn't create a disincentive to invest, because the network ALREADY exists. Secondly, We need to stop pouring our money in copper networks. Cutting line sharing was the worse thing the FCC could have done for the deployment of broadband. This will effectively kill the competition (Covad), who has played a key role in deploying broadband where the Bells didn't want to. This was a retarded move.


        We do this by forcing entrant competition to build thier own facilities and fiber networks (THESE ARE THE NETWORKS YOUR DON'T WANT TO SHARE). Facilitiy based competition will truely help in lowering costs, create new jobs, build a redudancies in our important communications network, and lastly give Lucent, Nortel, and the shot in the arm they need by giving them new business.

        The Bells and Democrats just used your own conservative zealotry against you, and turned slashdotters against thier best ally, Michael Powell, who would have kept line sharing.

        That's how dichotomies are played...

  • So how can I help my ISP run cable to my house? They HAVE to be allowed to run thier own fiber or it isn't fair!
  • Thanks FCC! (Score:2, Informative)

    by gekkotron ( 641131 )
    Let's see: Qwest won't service my line for DSL, but Covad does. That's the only broadband I can get. Guess I'm screwed.
    • same potential problem here, and the Covad DSL isn't all that great $60 for 1.5 Mbs/128 K. It works fine most of the time but in the rare case I'm working from home the upload cap is some what limiting.
  • by Anonymous Coward on Thursday February 20, 2003 @03:17PM (#5345922)
    The phone companies have been pushing for this for a while - it means they don't have to share and can basically charge what they want. I've heard rumors that some phone companies have been holding subscribers "hostage" to try to force the FCC to change the laws - they're refusing to upgrade their networks until they can be assured that they'll be the only ones to profit.

    It's time for the phone company monopoly to end - it's obviously not working for the interest of the consumer.
    • by overunderunderdone ( 521462 ) on Thursday February 20, 2003 @04:15PM (#5346502)
      they're refusing to upgrade their networks until they can be assured that they'll be the only ones to profit.

      I'm sure their argument is that they won't upgrade because they are afraid if they do they *won't* profit. Me? I don't know who to believe... Sure the phone company is greedy and wants to keep this pie all to itself, but on the other hand their competitors are just as greedy and want a free ride. Government has to step in and set a wholesale price that in the end is arbitrary and probably has a greater corelation to which company funded which campaign than to how much the line costs to install & maintain.

      The problem is that the one wire to your house IS a monopoly and there aren't many good ways to get around that. The only way to have real competition is between different networks - phone line, cable TV line (maybe the power line? wireless?) anything else is still a monopoly and you are only arguing about how to regulate it.
  • 1) Become a full-on Telco, Covad could pull it off if they tried.
    2) Lay your own damn pipes.

    Yes I work for a Non-Bell ILEC and frankly why should "my" infrastructure be used for someone elses profit. I wouldn't like it if Bell tried to bully their way into one of our markets, why should I be allowed to steal from them.
    • 3) migrate like the goose in winter
    • Re:Solutions (Score:5, Interesting)

      by loucura! ( 247834 ) on Thursday February 20, 2003 @03:22PM (#5345989)
      Perhaps because the Bell's infrastructure was paid for by the public, not by the Bells?
    • As a pipe owner, you do get to profit from these companies selling DSL. You lease your lines. Quite frankly, it is becoming clear that high speed lines should be a public good. Now if I could only get those pesky details worked out.
      • Re:Solutions (Score:3, Insightful)

        by bofkentucky ( 555107 )
        My understanding is that Bell has X cost invested in a mile of copper, but they had to lease at Y cost to Covad, actually losing money in the process.
    • Re:Solutions (Score:5, Informative)

      by quantum bit ( 225091 ) on Thursday February 20, 2003 @03:25PM (#5346029) Journal
      Yes I work for a Non-Bell ILEC and frankly why should "my" infrastructure be used for someone elses profit. I wouldn't like it if Bell tried to bully their way into one of our markets, why should I be allowed to steal from them.

      Yeah, the problem is though that the government subsidized the creation of Bell's infrastructure in the first place.
      • Re:Solutions (Score:3, Insightful)

        by eyeball ( 17206 )
        Yeah, the problem is though that the government subsidized the creation of Bell's infrastructure in the first place.

        Just because the government handed out some money to someone, does that give everyone else the right to share their assets? The government subsidizes farmers, but if I wander onto a farm and pick a few apples, I'll get arrested for theft. Or a better example, I wouldn't be able to walk onto the farm and plant a few sq. yards of my own crop. Or at least I shouldn't be able to.

  • No servers for you! Now your only choice will be to buy time from a responsible company that will censor you or hand you over to the Feds at the slightest provocation.
  • by FarmKing ( 52823 ) on Thursday February 20, 2003 @03:21PM (#5345976) Homepage
    Where I live, I am 150 yrds from a box containing DSL equipment. I have thus far been unable to use it because SBC refuses to power it up as long as they are forced to resell service to other companies. Maybe now, they will turn it on and allow me to get decent broadband service. While it is bad for competitors, I *the consumer* will probably be able to get DSL now.
  • BAH! (Score:5, Funny)

    by sevensharpnine ( 231974 ) on Thursday February 20, 2003 @03:22PM (#5345984)
    Then fuck the FCC! I hereby call upon all slashdotters to boycott those worthless...wait a minute...oh shit...

  • In the wake of the telecoms bust a whole bunch of comms companies went under: that's what's supposed to happen. The market was oversupplied, so the weaker companies died. It's competition, and it's good. Changing the rules like this is nothing more than protectionism for these companies, which is almost never a good idea (occasionally it can be justified if the company is being regulated to provide service to unprofitable areas that would suffer from the removal of the service, like train companies serving outlying districts). But were these phone companies really in enough financial trouble to justify this rule-change? The FCC isn't the greatest institution in the world, but they're not sub-moronic; does anybody know what their motivation was for doing this?
  • Points of View (Score:3, Interesting)

    by snatchitup ( 466222 ) on Thursday February 20, 2003 @03:23PM (#5345994) Homepage Journal
    Basically, the Big Phone companies have fabricated the argument that they're getting their clock cleaned by the Cable TV companies, and that regulations are stifling their ability to compete with CATV companies.

    Cable modems currently dominate in market share.

    Basically, they say, "There won't be any competition in broadband access because we can't compete with Big CableTV".

    This is a joke, unfortunately, many people see it their way.

    The thinking is... "We don't have enough time to do what is right, we just want to make sure we at least get an Oligopoly out of this."

    The whole thing is a joke, and I'm actaully kind of happy that Cable will rule the day. I consider them the lesser of two evils. Also, I like the way cable franchises are granted much better than the original consent decree that split up AT&T.

    The little companies get hurt. Ma Bell is just too powerful, end of discussion.

    AT&T ought to hold onto their cable a little longer. But, they've got just too much debt.

    Too bad.
  • by lysurgon ( 126252 ) <joshk@nOsPAm.outlandishjosh.com> on Thursday February 20, 2003 @03:24PM (#5346010) Homepage Journal
    From the article:

    The Federal Communications Commission on Thursday voted to exempt new high-speed communications networks from requirements that they be shared with competitors, a move aimed at encouraging investment in bringing fast Internet access to consumers.

    Right. Big time investment. Just around the corner. We just need to know it won't all get snapped up by our competition. But we're planning. Yes we are. Big Time Investment. Promise. Even though the economy's in the crapper. Investment. In the future. Of the internet. For Consumers. Investment.


    This is such complete and total doublespeak. Every telecom network in this country was built with public assistence. That's the way to "encourage investment." This is simply a move to allow the established Bells (and neo-bells, like SBC) reap more profit off of existing (publicly subsidised) infrastructure.

    Where am I going, and how did I get in this handbasket!
  • The Net closes in. (Score:3, Interesting)

    by rdewald ( 229443 ) <rdewald AT gmail DOT com> on Thursday February 20, 2003 @03:24PM (#5346011) Homepage Journal

    When I was a small business systems consultant I frequently encountered a problem with SMTP. The DSL lines for a certain baby bell would not pass outgoing email if the "from:" field did not contain the approved domain. I likened it to the post office refusing to deliver mail that was placed in a box with a return address not on the block where the box resides.

    If these companies can lock down these networks, then average users (those not interested/willing to manipulate email fields) are going to be "forced" to use the email domain of the provider as a return address. This provides these baby bell ISP's with a MSoft-ish method for bullying users into using their products (as opposed to just competing on the basis of quality).

    This is anti-competitive, un-American and anti-capitalist.

  • If I laid out a serious amount of money to establish COs and copper to (nearly) every house in the United States, I'd be a little pissed at the government for making me open it up to people who are offering competing services.

    Technically, the Bells really should be able to lay down the law when it comes to who access their cables. I mean, it's their cables.

    I'm all for competition, but this is kind of an awkward situation.

    On the other hand -- all ya'll who are hot to trot with wireless Internet access: hop on the venture capital wagon, and start your roll out in about .. oh .. a year. When phone companies jack their DSL rates, and the competition gets locked out of the copper ... guess who they're going to turn to?
    • by lunenburg ( 37393 ) on Thursday February 20, 2003 @03:36PM (#5346132) Homepage
      If I laid out a serious amount of money to establish COs and copper to (nearly) every house in the United States, I'd be a little pissed at the government for making me open it up to people who are offering competing services.

      Technically, the Bells really should be able to lay down the law when it comes to who access their cables. I mean, it's their cables.

      I'm all for competition, but this is kind of an awkward situation.

      The point you're missing is that the Bells, unlike say McDonald's being forced to let Burger King use their extra grills, have a monopoly in the last-mile telecom arena. What's more, it's a government-sponsored monopoly. That means that the Bells have, as a condition of their monopoly, certain restrictions and responsiblities that other industries don't.

      The Bells can stifle any sort of telecom competition simply because they DO control the wires going into your house. Thus, the only way to ensure any sort of telecom competition is to force the Bells, as a condition of their maintaining their utility/monopoly status, to open their networks to competitors at reasonable prices.
      • Define "reasonable" (Score:3, Interesting)

        by wiredog ( 43288 )
        Enough to cover the maintenance of that line? Or enough to cover that, plus extension of other lines, plus new services being rolled out, plus profit?

        If it's just the cost of maintaining the line, then where's the incentive to put in new lines and roll out new services?

      • We need to start saying what we mean:

        Bells should lose their monopoly/utility status. They should also lose government mandated leins to lay their wire. Then they can own the existing wires, if they like, but anyone has to be able to lay their own. And the cost of land should be real, to all the competitors.

        Same for the wireless spectrum. The government monopolies have been proven to be much, much less beneficial than freemarket driven bandwidth use. Regulate all spectrum like we regulate the visual spectrum and 2.4 GHz: You cannot blind anyone.

        I'm a damn liberal Democrat, and I can see that the libertarian answers are the correct ones in these situations. The existing legislation is profit-driven. Crony capitalism at its worst.
      • by overunderunderdone ( 521462 ) on Thursday February 20, 2003 @04:51PM (#5346890)
        What's more, it's a government-sponsored monopoly. That means that the Bells have, as a condition of their monopoly, certain restrictions and responsiblities that other industries don't... The Bells can stifle any sort of telecom competition simply because they DO control the wires going into your house.

        Is there any reason that you couldn't have more than one line? Sure you wouldn't want dozens or hundreds of different lines but couldn't each town or county grant three or four different companies the right to lay down those wires? Then each company could provide whatever services and compete on a level playing field with none of them holding either it's control over the physical assets or it's influence with the legislature to set a "reasonable price" (which may or may not be "reasonable" and will forever be controversial) over it's competitors.

        I suppose you still have the problem of who fixes the mess when a phone pole falls over and pulls down *all* the lines - perhaps they would all have to share the expense of a common maintenance & repair service on an equal basis.
    • by Chocolate Teapot ( 639869 ) on Thursday February 20, 2003 @03:38PM (#5346148) Journal
      Technically, the Bells really should be able to lay down the law when it comes to who access their cables. I mean, it's their cables.
      Under their streets too I suppose? Imagine the chaos and waste that would ensue if competing companies were forced to lay their own cable. Do you have a choice of electricity companies where you live? I suppose they should all use their own power cables too. Not to mention the water and sewerage companies. How about different rail companies using their own track?

      When it comes to essential public amenities, you cannot allow monopolies to stamp their and say "It's my ball, you can't play with it!"

    • by fishbowl ( 7759 ) on Thursday February 20, 2003 @03:51PM (#5346279)
      >If I laid out a serious amount of money to
      >establish COs and copper to (nearly) every house
      >in the United States, I'd be a little pissed at
      >the government for making me open it up to
      >people who are offering competing services.

      If you've paid taxes in the past century, you DID lay out a serious amount of money for that stuff.
    • Clue for you. (Score:5, Insightful)

      by twitter ( 104583 ) on Thursday February 20, 2003 @03:51PM (#5346284) Homepage Journal
      Technically, the Bells really should be able to lay down the law when it comes to who access their cables. I mean, it's their cables.

      Nope, it's your cable. They built it on public easments with monopoly protection. Keeping others off those lines is about as bogus as keeping others from being able to run their own last mile network, but that seems to be the way it was and is. Now demands have been made that others can use those lines AT COST and offer services that the Bells were unwilling to offer.

      I'm hoping that Powel plays this well. As someone else pointed out, he does not agree. This is just the kind of thing that will turn Powel into a houshold word, if he can pull it off.

      If he can't, I expect the Bells to start pushing their high priced and highly restrictive service. Woot, I might get to chose between two really lame monoply servers who own the internet.

      Screw them. Build your chunk of the wireless mesh today.

      • Re:Clue for you. (Score:3, Interesting)

        by krlynch ( 158571 )

        Nope, it's your cable. They built it on public easments with monopoly protection.

        First, the cable in most places wasn't paid for by the government; easements, yes, hardware, no. The exceptions to this general statement are in places where the cost of installing the cable and hardware could never have been recouped (sparse rural areas, etc.) over their lifecycle; and that was paid for by the government by a universal connectivity tax imposed on the customer base ... a tax which is still imposed on every line, in spite of the fact that "universal connectivity" was achieved two generations ago.

        Further, the monopoly protection was granted in return for nearly 100 years of delivery of government mandated QOS guarantees, universal access, interoperability and standards compliance that have driven world telecom markets, a steady tax stream (collected by the Bells on their dime for the FCC and local governments), rental income on many of those public easements, government mandated rate structures, etc, etc, etc. The government granted phone monopoly has for a very long time been a cash cow for the federal government, and local states take in a big chunk of revenue as well. The monopoly grant was a tit-for-tat public-good agreement that has long since been paid off, because it achieved its objectives of universal access to a nationwide publicly accessible switched voice network.

        Now demands have been made that others can use those lines AT COST

        And you'll find that the ILECs don't really argue against access (they might if the opportunity presented itself, but that isn't their main objection). Their argument is that the definition of AT COST is unfair and discriminatory. The definition in force until this FCC decision of AT COST only allowed the inclusion of ongoing direct maintenance costs, and that even those numbers were being low balled by regulators (according to the ILECs). The ILEC argument is that AT COST should be defined in terms of total LIFECYCLE costs, particularly since maintenance is such a relatively small fraction of the purchase-installation-maintenance-disposal cycle.

        The ILECs further argue that by being kept out of markets like cable TV and long distance (remember, THOSE companies are not being forced to provide access to their infrastructure, at ANY cost) that they are being unfairly forced to shoulder a cost burden that no other telecom grouping is being asked to provide in return.

        Does that really lead to a lack of investment by the ILECs? I don't have a clue; I'm sure that it is part of the issue, but there are certainly others. But it seems to me to be a fundamentally unsound premise that a long ago repaid, mutually beneficial, regulated monopoly agreement between the government and a private industry (an agreement, by the way, that was ruled to be illegal, and forcibly broken by the federal courts) can be used today to prop up competitors who are not being asked to provide very much in return...

  • by alta ( 1263 ) on Thursday February 20, 2003 @03:25PM (#5346018) Homepage Journal
    Here's two things that make me feel like this isn't soooo bad...

    First, just about every DSL provider in my area is already offering Phone to go along with DSL. Most of the DSL only providers in all areas died in 2000/1.

    Additinally what to stop a DSL only provider such as Covad to start "offering" voice. They could charge $900/line to get around the FCC rules. Nobody would buy it, but at least they could still sell their DSL.
  • by ackthpt ( 218170 ) on Thursday February 20, 2003 @03:25PM (#5346022) Homepage Journal
    I've been puzzling over something, lately. If AT&T was such a terrible beast that it needed to be broken up into (what, 11?) baby-bells, how is it acceptable that these things are pulling a T2, gathering themselves together so only 3 baby bells exist? Seems the whole anti-competitive issue begins there, not with the FCC yanking the rug out from under non-bell DSL providers.
  • In my house, the DSL supplier ended up being Brightnet because SBC kept giving us the runaround. It looks to me like if the line sharing abandonment sticks, we may become stuck with SBC's nonsense again. :(
  • by LowneWulf ( 210110 ) on Thursday February 20, 2003 @03:26PM (#5346036)
    From a linked Yahoo article: "Essentially, the majority of the FCC opposed the deregulation plan set forth by agency chairman Michael Powell."

    Excuse my ignorance (I'm Canadian), but if the majority of the FCC is opposing it, how did the plan get decided upon?
    • There were two major points being decided upon today by the FCC. The one people on Slashdot are crying and moaning about is for DSL only and has been outlined throughout the comments. The second point the CLEC access to lines through UNE-P which is what the Bells really cared about. This decision went the way of the CLECs/state regulators in that the RBOCs must still share their voice network with non-facility based LECs at state mandated prices. Note all of the RBOCs stock prices if you want to see which side won the war, no matter the decision of the DSL battle.
  • Nationalize! (Score:5, Interesting)

    by Anonymous Coward on Thursday February 20, 2003 @03:32PM (#5346090)
    The government should Nationalize the lines that run from the central office to homes, and rent those lines out to anyone for cost of maintenance.

    Too bad most consumers are so scared of socialism, even though it has a place in situations like this. Ironic, that socialism could give us a truely free market.

    The lines run through public property. They cross millions of private property boundries. They should be a public resource.

    Then the Phone Companies could compete on products and service. And the Baby Bells would probably all go under in less than a year after exposing their actual incompetance in a suddenly open market.
    • Re:Nationalize! (Score:4, Insightful)

      by Elwood P Dowd ( 16933 ) <judgmentalist@gmail.com> on Thursday February 20, 2003 @04:32PM (#5346675) Journal
      Yes. That would be fine. As would actual deregulation. If phone companies want to be able to cross all those million private property boundries with force of arms behind them, then the government should own those lines. Otherwise... I don't see a problem with taking away their leins on private property, and telling them that they no longer operate a utility. They must pay landowners to cross their property. And they aren't the only ones that can do it.

      Either option works for me. Our current situation is crony capitalism, plain and simple.
  • we have paid (Score:5, Insightful)

    by Anonymous Coward on Thursday February 20, 2003 @03:33PM (#5346103)
    What you all must realize is that the ILEC's have been given HUGE tax relief on behalf of the federal government in exchange for their responsibility to deploy and upgrade next generation networks. Theoreticly, the last mile option these ILEC's are fighting for are owned by US taxpayers. There has been much relief and many writeoffs done by ILECs for years on this infrastructure, however they have neglected to fullfill their promises in a timely manner.

    You must realize that before deregulation, the telco's were selling us $1,500/month T1's and per-minute ISDN service. DSL technology is old and could have been deployed in the /early 90's. It wasnt until deregulation in 1996 that we started to see DSL.

    Wait five years from now after deregulation occurs and we are still paying $50/month for 1.5Mbps ADSL when the rest of the world will have fiber strung to their doorsteps. The Bells have a history of stagnation and emtpy promises, thats why the telco act of 96 was created in the first place.
  • by szquirrel ( 140575 ) on Thursday February 20, 2003 @03:35PM (#5346120) Homepage
    According to Reuters, the FCC today decided to greatly curtail the laws that force incumbent phone companies to share their lines with their competition at cost.

    ILECs have not been forced to share their lines at cost. That is a myth invented by the baby Bells to convince lawmakers that linesharing makes them lose money. Actually what the 1996 Telecom Act says is that they have to rent their lines to outside customers and they must charge everybody the same rate, including internal customers.

    A popular stunt among the ILECs [webopedia.com] is to rent lines to their own internet divisions at way below cost, thus making their internet business seem more profitable than it is. The 1996 Telecom Act just evens the playing field in that respect and prevents the Bells from using their local loop monopoly to prop up other corporate divisions.

    The new rules do force line sharing as long as companies are willing to offer voice service, but this essentially states that if you are not already a phone company, you cannot offer DSL.

    This is actually not as bad as it sounds when you consider that FCC Chairman Michael Powell *spit* wanted to completely sweep away ALL the regulations that require the ILECs to share lines. His proposal was defeated with respect to local phone service because Republican commissioner Kevin J. Martin jumped the fence and sided with the Democrats. So while this may suck for Covad, Speakeasy, etc., at least it won't totally eliminate DSL competition for now.

    Probably both sides are going to be unhappy about this. Expect this battle to go to the courts next.

    This article [washingtonpost.com] has more good info.
  • by TheSHAD0W ( 258774 ) on Thursday February 20, 2003 @03:42PM (#5346197) Homepage
    So the phone companies have monopolies on the wires running to your house, and you have no alternative but to use them... Exactly whose fault is it?

    * The phone companies who own the wires running to your location?

    * The local governments, who regulate how many wires can be put up, and extort plenty of cash from anyone who wishes to emplace new ones?

    * The state governments, who already charge heavy tariffs on current communications methods (hey, it's a monopoly, we can milk it as much as we want), and also put more tariffs and more barriers on newcomers to the business?

    * The federal government, which severely limits anyone who wants to try a wireless solution?
  • by fishbowl ( 7759 ) on Thursday February 20, 2003 @03:47PM (#5346246)
    The real big problem with broadband is that you can't know whether you are allowed to have it until you try to get it. This has kept me from moving! I would rather stay in my apartment where I have 1.2 megabit dsl, static routing, etc., (costs $109/mo from the ISP + $65/mo from Qwest!), than to try to move without knowing in advance whether I can get the same service. The telco would expect me to move first, close a real estate deal, get a phone line and THEN find out whether or not DSL is available.

    If I were to try to move, I would have to do two things. 1. Stay at the current address until the deal is setup at the new one, phone line is installed, DSL is working, THEN cancel the old service and move. This will increase the cost of moving substantially. 2. Ensure that the real estate agent or landlord understands that it's a deal-breaker (escrow money is refunded, deposits returned) if it turns out DSL is not available, and that it might be a month after closing before this is discovered. I'd need that explicitly written into the contract, and absolutely clearly understood by everyone involved.

    If I'm looking at a piece of real estate, I want to know what utilities are available, as the very first items to evaluate. I want to know if it has running water, electrical service, natural gas, if there's garbage collection, telephone service, cable tv, and, DSL. Since my career depends on the internet access, it's actually on the same list as running water and electricity. And I can actually work around the lack of water and electricity, but if there's no DSL I'm stuck.

    So, why can't I find out BEFORE getting involved with a piece of real estate, whether it has this service available? Also, what kind of approach can I take to force the issue? I don't want to sign a contract or a lease without knowing in advance whether I can get DSL, what signal rate it will support, and what providers will offer the service.

  • Backfire? (Score:3, Insightful)

    by jcknox ( 456591 ) on Thursday February 20, 2003 @03:54PM (#5346313)
    This whole thing could backfire in the long run.

    I seriously considered turning off all of my landline services last year. The only thing that stopped me was the announcement that DSL was finally available in my area.

    If no competition in the DSL market causes me to turn off my DSL service, I'll likely turn off my landline phone as well, and go strictly cellular.

    What we could see happen, with wireless technologies becoming more and more viable, is the elimination of any wired communications to the home.

    Eliminate the "last mile" of copper and you eliminate the Baby Bells.
  • by antarctican ( 301636 ) on Thursday February 20, 2003 @04:00PM (#5346381) Homepage
    In Canada the local phone company basically has a monopoly over the last mile, and we're known to have some of the best DSL and Cable internet access available in the world.

    The problem isn't lack of competition, quite the opposite, more competition means more companies each with redundant staff and bureaucracies. The solution is to actually have the FCC mandate service quality. DSL service sucks down there because the phone companies are free to do whatever the hell they please.

    If you had a government regulating body which looked out for the best interest of the consumer and dictated that the Bells must meet these service levels for customers things would be rosey.

    But ooooh no, regulation is bad for business. BS! In natural monopolies like this it's the only way to go. You simply TELL the company they must provide quality service, no excuses.

    Until this happens we're going to continue to see the weekly story on slashdot of people whining that their DSL is too slow or they can't get service.
    • But ooooh no, regulation is bad for business. BS! In natural monopolies like this it's the only way to go. You simply TELL the company they must provide quality service, no excuses.

      Okay. But what happens when the laws requiring companies to provide certain quality of service are incompatible with profitability?

      A href="California energy crisis", that's what.

      • You apparently have no idea whatsoever about the causes of the California energy crisis.

        The providers initially claimed that they were being pinched by gov't mandated low prices, and actual high prices in the free market, but this was factually incorrect. The high prices in the "free market" were... here's the surprise: government mandated, and chosen by the power providers. They siphoned money out of the customers via PG&E, which really was pinched. There was surplus energy at the same time as the rolling blackouts.
  • Great News ... (Score:3, Interesting)

    by codepunk ( 167897 ) on Thursday February 20, 2003 @04:07PM (#5346427)
    The phone company will start gouging and the wireless networks will really start to grow...

  • by aaarrrgggh ( 9205 ) on Thursday February 20, 2003 @04:16PM (#5346521)
    While technically feasible, the concept of line sharing IS stupid. The physical infrastructure is the monopoly issue, and should be treated as such: DSL service providers should be leasing the physical copper wires (to the extend that they are physical copper wires, anyway) from the customer to the CO.

    I don't want POTS on my DSL line! I have no need for POTS! My cell phone is my primary phone number.

    The market should embrace novelty, and if the cost of doing that is a second pair of wires to your home to accommodate POTS, so be it! (With the important market caveat that other people must feel the same way...) Splitting hairs over the incramental cost for DSL above POTS service is not productive.

    Make the 3rd parties offer "full service" for them thar copper wires!
  • by Guppy06 ( 410832 ) on Thursday February 20, 2003 @04:57PM (#5346954)
    The decision, which could take several weeks to go into effect, is a defeat for FCC Chairman Michael Powell, who wanted to further deregulate telephone competition. He argued that leaving the telephone rules to the states, which have nine months to come up with their own unbundled network element rules, would give the telecom industry a "Picisso-esque regulatory backdrop" to maneuver.
    Yeah, God forbid the states have sovereign rights to decide what happens within its own borders. It's not like the Interstate Commerce Clause is getting blown all out of proportion or anything. Whether or not leaving it up to the states is a good idea is debatable, but it shouldn't be up to him to decide.

    See what happens when you take state governments out of the loop? I swear, repealing the Seventeenth Amendment [friendsforamerica.com] just keeps on seeming like a better and better idea...

  • by msoftsucks ( 604691 ) on Thursday February 20, 2003 @05:23PM (#5347207)
    Since now the DSL vendors have to string something for the last mile, how about fiber? They can use the extra bandwidth to outsell the monopoly telcos by providing higher bandwidth Internet service, digital phone service and video on demand. Since they don't have to worry about carrying the overhead for the obsolete stuff, the cost of doing this can be quite reasonable. Using VOIP for the phone service they could offer services that the POTS telcos could not! Use the video on demand to sell the Internet portion. Since there is plenty of bandwidth, provide a complete package to tie in multiple computers, multiple TVs, multiple phones and wireless. Since they are no longer telcos (as defined by the FCC rules) they don't have to worry about the regulations.

    If the DSL providers compete on a different level they can win this. This decision was a result of the FCC being bought by the telcos. Plain and simple.

  • by Agent Green ( 231202 ) on Thursday February 20, 2003 @05:35PM (#5347310)
    The first Baby Bell breakup had everything to do with deregulating long distance, and that did wonders for the American consumer.

    However, with the modern approaches to communication, the Baby Bells need to be broken up in another way I have not yet seen mentioned:

    Separate the dial provider from the infrastructure provider.

    Check this out: You RBOCs would be split into two separate entities, your dialtone providers, and your cable-line providers.

    Unfortunately, the infrastructure generally lends itself to a natural monopoly, similar to electrical service...but in most places, we can choose our energy provider...but still need to pay the distributor.

    This could work well with phone service. Once company would own and maintain the infrastructure, and provide the physical path for anyone who make service available on it. Then the costs of the line would have to be paid by the service providers you choose, be it Covad, Verizon, or AT&T.

    It would be nice then, because any companies could provide competing service if they all have to cover essentially the same wireline costs to reach the consumer. However, if the bells get to keep the whole ball of wax, then there'll never be any good service.

    I've got my Covad IDSL line because I have no restrictions on what I can do with it...and I have a block of IPs. Compare that to the "business-class" Verizon DSL and cable modem service, and I get one IP...no routable netblock...and a ton of service restrictions (i.e. no servers).

    In short, unless the physical plant is made into a separate operating company, we will never truly have competition for telephone service.
  • by TheFrood ( 163934 ) on Thursday February 20, 2003 @05:39PM (#5347349) Homepage Journal
    In some sense, I think this was inevitable. When one company is responsible for the infrastructure and is required to allow other companies to use that infrastructure to compete with it, it's too easy to make an argument that that's not a fair situation. That argument is incorrect in this case (see various posts above), but that's not the point. The point is that sooner or later, the local telcos were going to muscle out the competing ISPs.

    So what happens now? Once the rules get fully phased in, the rates will rise as the telcos milk their monopolies on internet service. At some point, someone will complain, the government will step in, and internet service will become a regulated monopoly.

    In the end, I don't think that'll be a bad thing. Local telephone service is a regulated monopoly, and it's been pretty good so far. But it might take awhile to get there.
  • Funny thing is... (Score:3, Interesting)

    by NFW ( 560362 ) on Thursday February 20, 2003 @06:08PM (#5347535) Homepage
    I submitted a story about this to slashdot a few days ago, complete with a link [tispa.org] to a site that summarized the issues and provided forms for sending well-worded comments to the FCC.

    But I guess the slashdot editors would rather bitch about it in retrospect than do something about it beforehand.

  • Catastrophe (Score:3, Insightful)

    by Featureless ( 599963 ) on Thursday February 20, 2003 @06:20PM (#5347634) Journal
    The internet is dangerous to a lot of people. Traditional media companies don't like it because it provides "unwantedly democratic" alternatives to the traditional mass media. It allows free trade of digital media (i.e. P2P), threatening the publishing/retail trusts. Internet radio is nipping (ever so delicately, just now) at the heels of traditional radio. Heck, it even threatens the phone company's monopoly on voice calls (i.e. VoIP, which is growing exponentially).

    Clearly it must be stopped.

    Their goal is to reduce the ownership of all user-facing internet services to a managably small set of large owners. Coincidentally, these will be the big media and phone companies that are threatened by the internet in the first place. When all the independents and smaller players have been eliminated, and less than a dozen RBOCs and cable operators control all broadband (and thus almost all internet access) in the U.S., they will kill what threatens them by simply raising the price.

    Some number of months from now, users will find that their ISP has suddenly renegotiated their deal. The new choices will be cheap but brutally capped broadband that is useless for P2P, streaming media, and VoIP... pay-per-K offerings that ensure these things are prohibitively expensive... and classic, "business class" $1,500+ T1-style service.

    Surveillance of users will become not only more pervasive but more standardized, as the Internet trust announces trade groups and landmark deals that support both police and "private" law enforcement efforts.

    Of course, in addition to prices going up, this guarantees that investments in new infrastructure (to provide better services) will now entirely cease. Without competition to threaten offering anything better, the bells and cable companies will do what they have always done (before TA96). Absolutely nothing.

    Oh, you thought the cable companies and bells would compete with each other? This one really slays me. Why spend billions competing when you can just form a trust and price-fix instead? This is capitalism 101. And when the number of players is that small, it's virtually guaranteed to happen.

    I know, I'm a paranoid lunatic. None of this could really happen here, right? I mean, just because it's already happening in Australia, Canada, and England... pure coincidence.

    Of course, this tragedy will cause lots of collateral damage. The first victim that comes to mind is the video game industry, which has lots of innovative, "harmless" uses for massive, cheap bandwidth. There are many others as well.

    But for all you folks watching in amusement as the big players stumbled trying to crush P2P, VoIP, etc. with lawsuits and bribed-legislation, this is the other shoe dropping.

    On the bright side, the market for wireless technology might be looking up... that is, until the FCC turns out to be less than forthcoming with licenses, rules, and considerations necessary to allow wireless broadband alternatives. Watch for it.
  • by DrunkBastard ( 652218 ) on Thursday February 20, 2003 @06:23PM (#5347656) Homepage
    Bah, you all just need dedicated unbundled loops and SDSL connections. Line-Shared ADSL? Blah I say. Not to mention this does not effect ILEC provided Line-Shared services (Like Qwest DSL). The ILECs are required to provided these services, and the times coming when they better have it, or pay the price, thanks to that fiasco of a '96 telco act. What does this do? It forces CLEC's to get their acts together. Very few CLEC's that exist do what they were originally intended to do, compete against the incumbents! Compete with, not have the incumbents subsidise their existance... God I love my 1.1mbit SDSL connection, I love my 30-40 ms away from such sites as yahoo and google, my 99.99%+ uptimes. I think my ISP did it right, they are fairly small fish in the world, but they are a PSC regulated, Tier 2, CLEC, that creates it's own private infrastructures (FTTH, FTTB, CTTH) or uses dedicated unbundled loops from the ILEC, are triple-redundant, ds3 and oc3 connections, and all of this where? Montana of all places. Rural broadband? How about a dark fiber loop to your home?

No amount of genius can overcome a preoccupation with detail.