SEPARATE STATEMENT OF CHAIRMAN MICHAEL K. POWELL

*Re: Review of Regulatory Requirements for Incumbent LEC Broadband
Telecommunications Services et al., CC Docket No. 01-337 et al.*

*Re: Review of the Section 251 Unbundling Obligations of Incumbent Local
Exchange Carriers et al., CC Docket Nos. 01-339 et al.*

In this combined statement, I write separately to underscore my support
for these two *Notices of Proposed Rulemaking*, which comprise the
second and third in a series of notices the Commission recently
announced that will begin Phase II of our local competition
implementation and enforcement efforts under the 1996 Act.[^1]

Review of Regulatory Requirements for Incumbent LEC Broadband
Telecommunications Services

I vigorously support the *Notice* we hereby adopt that initiates a
review of the regulatory requirements applicable to incumbent LEC
provision of high-speed telecommunications services. In this proceeding,
the Commission will ask whether potentially robust competition among
multiple types of broadband service providers suggests that we should
avoid subjecting incumbents to the same regulatory burdens that we
impose on these carriers with respect to their provision of local
telephone service. That is, we ask whether incumbent LECs, which are so
clearly dominant in the provision of local phone service, must also be
treated as dominant as they use DSL and other technologies to provide
high-speed telecommunications services in competition with cable modem
service providers and other types of platforms. I would point out that
this item focuses on traditional Title II common carrier regulation,
historically arising out of the section 201 and 202 of the
Communications Act of 1934, as applied to incumbent LEC provision of
high-speed *telecommunications services.* In contrast, the
aforementioned proceeding regarding regulation of incumbent LEC
broadband information services will address the question whether Title I
should apply when incumbent LECs provide a bundled high-speed
*information service* offering.

I would emphasize that our initiation of this proceeding should not
suggest a grand departure from our ongoing efforts to implement
unbundling, collocation and other market-opening requirements with
respect to incumbent LECs pursuant to section 251(c)(3) of the Act.
These other requirements are intended to allow competing carriers,
particularly facilities-based carriers, to provide new and innovative
telecommunications services. By the express terms of the statute, the
Commission is duty-bound to continue our implementation and enforcement
of these provisions, and we will.

Rather, this *Notice of Proposed Rulemaking* is intended to develop
further one more avenue of thinking about how regulation can serve to
help (or hinder) broadband deployment. It is, in that sense, not a
signpost heralding a new direction but an attempt to add yet another
arrow to the regulatory quiver we will use to attack and, in conjunction
with other forces outside our purview, eventually subdue the broadband
beast.

Notwithstanding my enthusiasm for our decision to initiate this inquiry,
I for one have an open mind as to how these questions should be
answered. For example, it may prove too unwieldy for both carriers and
the Commission to treat incumbents as dominant for their provision of
traditional local service but non-dominant for their provision of
high-speed telecommunications services. I also acknowledge that
declaring incumbent LEC provision of broadband telecommunications
services non-dominant could have consequences in other areas of
regulation that the Commission has not yet fully anticipated. Yet the
importance of broadband deployment to the public interest and welfare is
too great to disregard any potential method of facilitating that
deployment. In sum, we must ensure that we leave no stone unturned in
our pursuit of this important goal.

Review of the Section 251 Unbundling Obligations of Incumbent Local
Exchange Carriers

I similarly and wholeheartedly support the *Notice* we adopt here that
initiates our scheduled triennial review of UNE obligations imposed on
incumbent LECs pursuant to sections 251(c)(3) and 251(d)(2). Taking our
cues from the Supreme Court in its opinion remanding to the Commission
the task of giving meaningful effect to these provisions, my former
colleagues and I determined that the agency would, in three years,
revisit its decisions regarding the availability of UNEs.[^2] The
purpose of this triennial review would be to keep those decisions
current with ongoing market and regulatory developments. That was in
1999, and now the year 2002 fast approaches.

Not surprisingly, however, I support this item for reasons other than
the fact that it will put the Commission in a position to deliver on the
commitment it made in 1999. [First]{.underline}, it underscores the
Commission's ongoing commitment to the promotion of facilities-based
competition, which was pronounced most clearly by my former colleagues
and I in the 1999 *UNE Remand Order*.[^3] I believe this commitment
should focus, in particular, on both so-called "full facilities-based"
competition and competition from newer entrants who supplement their own
facilities with network elements leased from the incumbent. As I have
demonstrated in my decisions and public statements over my four years at
the Commission, I fully support the use of facilities and individual
UNEs as means to promote local competition while simultaneously
furthering the related goals of encouraging deregulation and innovation.
The 1996 Act and our experience since its passage demand no less.

[Second]{.underline}, I support this item because it emphasizes further
an area of inquiry begun in the *UNE Remand Order.* Specifically, in
that *Order,* we considered how the Act's goals of encouraging broadband
deployment and investment in competing facilities should shape
unbundling policy.[^4] I support our decision here to continue and to
expand this area of inquiry.

[Third]{.underline}, I support the Commission's decision, in seeking
comment here on whether to unbundle aspects of the incumbent's network,
to ask whether and the extent to which we should take note of the
availability of technologies other than circuit-switched telephony
provided by traditional common carriers. In particular, this *Notice*
expressly focuses on the roles that cable and wireless companies have
begun and will continue to play in the market for telephony and
broadband telecommunications services. This emphasis may also be viewed
as expansion of an avenue of inquiry begun by the previous Commission.
Specifically, in the *UNE Remand Order,* my former colleagues and I
appropriately followed the Supreme Court's demand that we not blind
ourselves to the availability of self-provisioned or other alternative
facilities in determining whether to unbundle elements of the incumbent
LEC's network.[^5]

To my mind, it seems premature to suggest that the availability of such
technologies should be fully dispositive of the question whether to
require the availability of specific UNEs. Yet it does stand to reason
that such availability may give us some indication of the alternative
tools newer entrants could use to serve customers if the Commission were
to decline to unbundle any particular element of the network. I
encourage parties to provide detailed and well-supported comments in
order to help us determine whether this line of reasoning is, in fact,
sound.

As this *Notice* itself reminds us, the Commission now has the benefit
of two years of experience with the current unbundling rules and almost
six years of experience with promoting competition since the 1996 Act
was passed. These are no doubt merely the opening chapters of a
regulatory epic that will take many years to rewrite a near century-long
history of legally sanctioned monopoly in the telephone market. But I
believe it is critical that we take stock of the lessons we have learned
so far and make any changes that may be necessary to ensure that our
rules remain faithful to the statute and its goals of promoting
competition, deregulation and innovation in telecommunications markets.

\* \* \*

I thank the Common Carrier Bureau staff and my colleagues for their
enormous work on these *Notices* and look forward to working with them,
as well as my state commission colleagues, in carrying out both of these
important "Phase II" proceedings.

[^1]: The first of these items was the *Notice of Proposed Rulemaking*
    regarding performance requirements for UNE provisioning that we
    adopted at the November agenda meeting. *Performance Measurements
    and Standards for Unbundled Network Elements and Interconnection, et
    al.*, CC Docket No. 01‑318, Notice of Proposed Rulemaking, FCC
    01‑331 (rel. Nov. 19, 2001). In addition to that *Notice* and the
    two items captioned above, we will in the coming weeks seek comment
    on the appropriate regulatory framework for incumbent LEC provision
    of broadband information services.

[^2]: *Implementation of the Local Competition Provisions of the
    Telecommunications Act of 1996,* Third Report and Order and Fourth
    Further Notice of Proposed Rulemaking, 15 FCC Rcd 3696 (1999) ("*UNE
    Remand Order")*, ¶ 151.

[^3]: *UNE Remand Order,* ¶ 14.

[^4]: *UNE Remand Order,* ¶¶ 107-113.

[^5]: *UNE Remand Order,* ¶ 8.