Dueling Headlines on FCC UNE order

by on December 16, 2004

The media seemed flummoxed yesterday on the FCC’s order on UNE’s. Certainly not an easy thing to digest, and a scan of headlines shows them all over the board. Typical of the dueling headlines: CBS Marketwatch’s “FCC ruling seen benefiting Bells; critics blast decision“, vs. Forbes’ “FCC Decision ‘Slight Negative’ For Baby Bells“.

The substance here is a bit complex, and will take a while to sort out. (The full text hasn’t been released yet.) But the short story is that the FCC did significantly cut back its rules on telephone companies yesterday, most notably taking mass-market switches off the shared assets table. This means telco’s will not have be forced to share their assets as much as before, meaning MORE investment, and MORE real competition, as others build their own networks.

The flip side is that the FCC KEPT far more rules in place they they should have. Most controversially: lines used to serve big office buildings in downtown areas. Although most downtown areas are intensely competitive–remember all those streets being torn up a few years ago? –the FCC will still force telcos to share their high-capacity lines with competitors in 99.5 percent of line centers.

Thus a mixed bag. Expect more litigation.

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