FOR IMMEDIATE RELEASE News Media Contact:

July 16, 2002 Sam Feder: 202-418-2159

> **PRESS STATEMENT OF COMMISSIONER KEVIN J. MARTIN ON THE COMMISSION'S
> DECISION ON VERIZON'S PETITION FOR PERMANENT FORBEARANCE FROM WIRELESS
> LOCAL NUMBER PORTABILITY RULES**

I support the Commission's decision to deny, in part, Verizon's petition
for permanent forbearance from the Commission's wireless number local
portability (LNP) rules, although I disagree with the legal standard the
Commission uses to assess Verizon's forbearance petition.

I believe that competition is preferable to regulation. Market forces
are the best method of delivering choice, innovation, and affordability
to consumers across our nation. But that does not mean that the
Commission has no role to play. The Commission has an important role to
play in creating an environment in which competition can flourish. And
where there are market failures, the Commission may need to step in and
take action.

The inability of consumers to keep their phone numbers when they switch
carriers can be an impediment to competition. It imposes a cost to
switching carriers, which, for many consumers, could be significant. In
order to make a switch, consumers must contact the full range of people
from whom they expect to receive calls, and many must also change
business cards, letterhead, advertisements, and professional
directories. These costs not only provide a disincentive for consumers
that may want to switch providers, they also disadvantage new entrants
to the market.

Thus, LNP can be important for competition. It allows consumers to
choose a cheaper or more innovative wireless service without incurring
some of these not insignificant switching costs. Moreover, it allows
consumers more easily to replace their wireline phones with wireless
phones, providing direct competition to the incumbent wireline telephone
providers. A recent poll found that 18 % of wireless phone owners use
their wireless phones as their primary phones. LNP may be an important
part of ensuring that competition with wireline phones continues to
grow.

The ability of new entrants to compete with established providers may
become an even more important issue as additional deregulatory steps
that the Commission has already taken go into effect. For example, the
spectrum cap regulations, which limit the amount of spectrum any carrier
can hold and thus ensure that there can be at least four competitors in
any given market, will sunset January 1, 2003. In the post-spectrum-cap
environment, in which some further consolidation may occur, the ability
of smaller, new entrants to compete with even larger wireless carriers
may be critical to maintaining a vibrant competitive market and thereby
ensure that consumers continue to receive the most innovative and
affordable services.

For all of these reasons, I support the Commission's conclusion that our
LNP rules are important and not to forbear permanently from applying
them. I also support a one-year delay in implementing those rules to
ensure successful implementation of our E911 rules, respond to carriers'
concerns about the difficulty of simultaneously implementing LNP and
pooling, and protect the interests of consumers.

I disagree, however, with the item's implementation of the standard for
assessing forbearance petitions. In particular, I am concerned with the
Commission's failure to give sufficient content to the term "necessary"
in section 10 of the Communications Act. That provision requires, among
other things, that forbearance be granted if enforcement of the
challenged regulation is not "necessary" to ensure that charges,
practices, etc., are just and reasonable, and enforcement of the
regulation is not "necessary" for the protection of consumers. 47 U.S.C.
§ 160(a). I am also troubled by the item's failure to clarify that the
burden of rejecting a forbearance petition rests with the Commission.

\- FCC -