Qwest: Let FCC rule on prices
The company asks Congress to stay out of the debate as it seeks
an exception to limits on its wholesale service rates.
By Kimberly S. Johnson
Thursday, June 26, 2008
With just a month before a key regulatory ruling, Qwest is
continuing to fight for a petition that would let it raise rates
for wholesale customers and is asking congressional members to
refrain from getting involved.
In a letter to U.S. Rep. Diana DeGette, a Denver Democrat,
earlier this month, Qwest chief executive Ed Mueller requested
that Congress not block the Federal Communications Commission
from deciding on the petition by July 26.
The Denver-based telecommunications company filed a petition
with the FCC in April seeking forbearance, or relief, from
federal rules limiting wholesale service rates in its top four
markets — Denver, Seattle, Phoenix and Minneapolis. In its
request, the company said there's sufficient competition in
these markets to eliminate the need for fixed pricing.
"We believe the time to stop price regulation is now," said
Mueller in the letter to DeGette. "All we are asking of
Congress, and our in-region congressional delegation in
particular, is that the expert agency, the FCC, be allowed to
complete its consideration of Qwest's forbearance petitions."
The companies that buy wholesale service from Qwest have been
talking to the FCC and members of Congress in hopes the FCC will
reject Qwest's petition.
"Congress has oversight of the FCC, I think it's perfectly
appropriate for them to weigh in," said Lisa Youngers, director
of federal regulatory affairs for XO Communication. "What
is at stake here is very important."
According to Steve Davis, Qwest's senior vice president of
public policy, it's unlikely Congress would step in to stop or
delay the FCC's decision.
"It was more to advise the congresswoman what the status is and
what's going on," he said. "We believe (the concept of)
low-cost prices to jump-start statewide competition has run its
course. Competition is vibrant in the marketplace."
Youngers disagreed, noting that in many places Qwest is still
the only company that provides last-mile connections to
businesses and residents. She said that should Qwest be
granted forbearance, there will be "tough choices to make."
"The result will be rate increases," she said. "And as a
company that provides services, facilities and employees in
those markets . . . that has a real impact . . . and a lot of
Qwest won a forbearance petition in
in 2005. In recent months, McLeod
USA, now Paytec, said it would stop signing
up new residential and small-business customers because of price
increases it has endured from Qwest, according to William Haas,
vice president and deputy general counsel for McLeod USA, in an April
Denver Post interview.
However, in a separate letter to the FCC last week, Qwest called
McLeod's reasoning "untrue," stating the company's actions in
the market have to do with the company shifting its focus to
Kimberly S. Johnson: 303-954-1088 or