WASHINGTON-Wireless-wireline interconnection reforms proposed by federal regulators mark the beginning of a revolutionary process to redefine the relationship between commercial mobile radio service providers and local telephone companies, an exercise tied to the broader policy goal of local competition.
In addition to establishing interconnection parity, policymakers want to level the playing field in local markets by developing new procedures for distributing telephone numbers, area codes and specialty codes and for transferring consumers’ telephone numbers from, for example, a wireline to a wireless carrier. The process is called portability.
The transition from a monopoly to a competitive environment in the local telephone market is unlikely to be smooth. For one thing, the jurisdictional boundaries for interconnection and numbering issues are not entirely clear. Generally speaking, the Federal Communications Commission oversees interstate telecommunications and states regulate intrastate traffic.
Within the FCC, the lines of authority governing wireless-wireline interconnection are blurred as well. The telecommunications reform bill struggling toward passage in the GOP-led Congress should offer some direction in that regard, though the FCC is not waiting.
Michele Farquhar, new chief of the Wireless Telecommunications Bureau, has said that local competition depends on interconnection guidelines being fair and equitable across the board. But the CMRS-LEC interconnection proceeding is in the hands of the Common Carrier Bureau, which is more familiar with traditional monopoly local landline telephone regulation.
However, that historic bias is offset to some degree by the fact that the Common Carrier Bureau is headed by Regina Keeney, who until just recently was chief of the Wireless Telecommunications Bureau.
The “bill and keep,” or reciprocal termination plan proposed on an interim basis by the FCC last month calls for wireless and wireline carriers to keep revenues from calls each generates and to terminate the others’ traffic at no charge. That model currently is used by LECs for terminating each others’ traffic and by Internet online network service providers.
Bell and other local telephone companies today charge paging, cellular, specialized mobile radio and personal communications services operators between two and three cents per-minute to terminate wireless signals on the landline network, according to industry figures. Yet wireless carriers receive no compensation for terminating calls that originate on the landline network. It is estimated that cellular carriers paid $800 million to LECs in 1994.
The FCC also is considering flat-rate access fees for dedicated transmission facilities connecting LEC and CMRS networks, believing such charges should approximate those associated with similar interconnection arrangements, and that details about them should be public.
That the FCC proposed to embrace an interim CMRS-LEC interconnection policy is particularly significant, according to Cellular Telecommunications Industry Association President Thomas Wheeler. He called the FCC initiative the most important in years-in financial terms-for the wireless telecommunications industry.
The United States Telephone Association, while declining to comment on the specifics of the proposal, said it would have preferred to see the issue addressed in a comprehensive interconnection rulemaking proceeding.