B2B firms fight Qwest relief
Telecoms meet with PUC commissioners in an effort to keep Qwest
from raising rates for "last-mile" connections.
By Kimberly S. Johnson
Wednesday, April 16, 2008
Qwest's request for a reprieve from federal regulation guiding
the amount it can charge competitors for access to its lines was
fought at the local level Tuesday at the Colorado Public
Business-to-business telecommunications companies met with PUC
commissioners asking for support in their fight to deny a Qwest
petition that would potentially increase the rates it charges
companies such as Covad and XO Communications for "last-mile"
connections to businesses and, in some cases, homes.
"Wholesale rates will go up, and it will impact small and medium
business customers," said Denver-based Gregory Diamond, senior
counsel for Covad.
The San Jose, Calif.-based company has significant operations in Denver, including a
customer-operations center in the Lowry area.
Qwest filed a petition with the Federal Communications
Commission last April asking for forbearance, or relief, from
federal rules setting those rates in its top four markets —
Denver, Seattle, Phoenix and Minneapolis — stating that there is
sufficient competition in these markets to remove fixed pricing.
"Our argument to the FCC is that promoting competition doesn't
mean limiting competition," said William Haas, vice president
and deputy general counsel for McLeod
USA, now Pactec.
But according to Steve Davis, Qwest's senior vice president of
public policy, the petition would "relieve us from providing the
facilities and service below cost."
"We would be able to provide just and reasonable rates," he
The FCC has until July 26 to rule on the petition.
"If the FCC doesn't act in 15 months (of filing the original
petition), then it's granted indefinitely," said Rex Knowles,
executive director of regulatory affairs for XO Communications,
which has 3,000 customers and 334 employees in the
The PUC submitted comments in support of denying Qwest's
petition last August, but since that time, two commissioners
have been replaced. The new group has not taken a stand on
Qwest won FCC relief in the
market in 2005. For McLeod, the move has led to monthly cost
increases of 30 percent for specific wholesale services.
Some one-time connection fees have jumped from $70 to $650, Haas
"We (recently) told the
commission that we are going to stop offering residential
service and service to small- business customers," Hass said.
"Since 2005, we've taken our direct-sales force out of
Kimberly S. Johnson: 303-954-1088 or