Telecommunications Firms Announce Compromise on Qwest's Network Fees
11 May 2004
Denver, CO -- Thirty-one telecommunications providers submitted to Qwest an agreement on a compromise plan concerning rates charged by Qwest to its competitors for the use of unbundled network elements (UNEs), like switches and local loops. These elements provide the essential connections between alternative providers and local phone customers throughout 14 western states. Successful local phone competition is a key element of the 1996 Federal Telecommunications Act.
The 31 companies, all participants in the MCI/Qwest mediation surrounding agreement on use of the UNE platform, requested a response from Qwest by close of business today, Monday, May 10, 2004.
The historic announcement proves that removing major obstacles to agreement in the telecommunication industry is possible. Disagreements among telecommunications providers surrounding usage fees and access to the existing network have presented major stumbling blocks in the development of a competitive telecommunications market. Moreover, this agreement spans companies with vastly different business plans and market size.
"This proposal represents a major step forward in the creation of a vibrant, competitive market for local phone service," said Jay Weber, President of Liberty Bell Telecom, headquartered in Denver, Colorado "It's fairly remarkable that 31 independent companies of various sizes and interests were able to reach a common solution. Our hope is that Qwest will take the proposal seriously and work toward a resolution that will mean an end to the legal wrangling and the beginning of a fair fight for customers in the open market."
The agreement comes at a critical period in which Qwest and the competitive local exchange carriers (CLECs) are in mediation to resolve the competitive issues. Parties have until June 15th to reach an agreement before the D.C Circuit Court of Appeals formally turns the matter over to the Federal Communications Commission (FCC) for resolution. The FCC has asked that parties make every attempt possible to resolve the issue.
In essence the proposal seeks a statewide, fixed pricing structure for both UNE-P and UNE-L elements. This would allow for consistency and certainty over the four-year term of the agreement and accelerate the move to facilities-based competition. The agreement provides for increases in the UNE-P rates charged by Qwest and decreased rates and improved performance measures for UNE-L. In addition, the proposal seeks to guarantee access to competitors for current and future services from Qwest.
"This unique proposal is truly a milestone in these negotiations," said Tom Pelto, AT&T Vice President of Law and Government Affairs. "If Qwest is genuinely interested in finding a solution that works for all parties, this is it. If they are intent on finding a solution that only works for them, this proposal will land with a thud. This could either be a turning point or jumping off point, and it's really Qwest's call."
Together, the 31 CLECs represent a significant number of residential and small business customers throughout Qwest's 14-state local phone region, all of whom receive service through the use of UNEs. The CLECs include both national companies like AT&T and MCI to local and regional like Liberty Bell Telecom and Tel West.
About AT&T
For more than 125 years, AT&T (NYSE "T") has been known for unparalleled quality and reliability in communications. Backed by the research and development capabilities of AT&T Labs, the company is a global leader in local, long distance, Internet and transaction-based voice and data services.
