The FCC recently released the agenda for its November 22 2019 open commission meeting.

Buried in that announcement was a draft of an upcoming rulemaking that facilities-based CLECs need to watch closely if still using DS0, DS1,  and DS3 unbundled network elements or UNEs. The rulemaking is seeking to free price cap ILECs from the obligation of having to provide DS0, DS1 or DS3 UNEs, among other things (see below).  From the FCC filing, the proposed order would propose removing certain unbundling requirements, including those for:

  • DS1 and DS3 loops in counties and study areas deemed competitive in the BDS Order and the Rate of Return BDS Order, with an exemption for DS1 loops used to provide residential broadband service and telecommunications service in rural areas;
  • DS0 loops in urban census blocks;
  • Narrowband voice-grade loops ;
  • Dark fiber transport in wire centers within a half-mile of alternative fiber.
  • Propose removing avoided-cost resale requirements in non-price cap incumbent LEC service areas.

Although there is some merit in the FCC’s argument that DS0/DS1/DS3 loops don’t provide the bandwidth required in today’s marketplace, this isn’t always the case. 

The standard the FCC used to determine if competition exists is evaluated at a county level in the BDS order and those that have worked in an access management capacity in the telecom industry knows that what really matters is the building or location level as not all locations have high speed facilities available even in the most competitive counties / cities in the US.

This development is striking as the FCC very recently debated the issue of requiring ILECs to provide UNE loops in its response to US Telecom’s ILEC Forbearance petition and chose to rule to require that ILECs continue to provide UNE loops. The key facts at this point that CLECs need to understand are the following:

  • DS0, DS1 and DS3 UNE loops may be going away in the so-called competitive counties per the BDS order (a list of these counties can be found here: https://www.fcc.gov/bds-county-lists)
  • The FCC is seeking comments on how this should be transitioned (The FCC is proposing that CLECs be required to transition off of UNEs in 3 years but that the ILEC be allowed to stop providing them after 6 months of order’s effective date.)

At this point, we recommend that CLECs do the following:

  • Identify the potential exposure to this change by compiling an inventory of how many UNEs and customers are impacted by this change
  • Determine potential service replacement options and cost / margin impacts
  • Pull together a high level draft plan of how you will migrate impacted facilities and the time you will need to do so
  • Monitor this proceeding and participate with comments at the FCC to shape the outcome in your favor