CenturyLink: Verizon Wants It Both Ways on BDS

CenturyLink says Verizon is trying to have it both ways on the competitiveness of the business broadband market, and thus the need for potential new rate regulations.

In a letter to the FCC, CenturyLink pointed out that stumping for its purchase of XO Communications, Verizon included an economic study entitled “Whitepaper on the effect of Verizon’s XO acquisition on business data services.” 

"[A]lthough the Verizon-INCOMPAS [BDS revamp] proposal is predicated on a lack of BDS competition, the Whitepaper emphatically concludes that 'there will continue to be extensive competition for [BDS] provided over fiber, cable, and copper by a wide range of providers' following the proposed transaction," said CenturyLink.

FCC chairman Tom Wheeler has based his proposed revamp of BDS (formerly special access) on a Verizon/INCOMPAS proposal. Incumbent carriers other than Verizon—CenturyLink, AT&T—do not support the proposal. Cable ISPs also feel targeted since it could mean imposing new rate regs on them.

“CenturyLink’s characterization of the Verizon/INCOMPAS joint proposal is wrong," said Kathy Grillo, Verizon senior VP and deputy general counsel. "Our joint proposal is not a commentary on the current state of competition.  It is a compromise intended to resolve an issue that has been overhanging the industry for years.

"We have always maintained that regulation is only necessary where competition does not discipline the market. Of course, many markets are already competitive. In markets that are not sufficiently competitive, Verizon and INCOMPAS have offered a framework to address them.

"Instead of trying to poke holes in the only meaningful compromise on the table, we encourage all stakeholders to work together to find a reasonable path forward.”

Wheeler is expected to bring up his BDS revamp proposal for a vote before the end of the year, likely at the October meeting. He was being urged to do that later by Senate Democrats this week, notably Ed Markey (D-Mass.) and Claire McCaskill (D-Mo.).

John Eggerton

Contributing editor John Eggerton has been an editor and/or writer on media regulation, legislation and policy for over four decades, including covering the FCC, FTC, Congress, the major media trade associations, and the federal courts. In addition to Multichannel News and Broadcasting + Cable, his work has appeared in Radio World, TV Technology, TV Fax, This Week in Consumer Electronics, Variety and the Encyclopedia Britannica.