June 22, 2000

**Separate Statement of Commissioner Susan Ness**

# Re: Review of Commission Consideration of Applications under the Cable Landing License Act

Last July, the Commission granted a submarine cable landing license for
the Japan-U.S. Cable Network ("JUS CN").[^1] During the proceeding, it
was alleged that the entities involved in the consortium controlled key
inputs for other undersea cable systems serving the same routes,
including access to landing stations, backhaul facilities, and local
interconnection.[^2] It was also alleged that such entities had the
incentive and ability to deter construction of additional capacity. In
granting the JUS CN cable license,[^3] the Commission recognized the
value of commencing a broader proceeding to examine the licensing of
submarine cables and the best manner to promote competition and benefit
consumers.[^4]

The recent increase in submarine cable capacity has been a tremendous
success story, driven by the desire of more and more carriers to provide
international data and Internet access services. Undersea cable capacity
on transatlantic and transpacific routes has been increasing
exponentially between 1995 and 1998.[^5] Such capacity growth is
expected to continue at least for the next few years.[^6] At the same
time, market prices for both transatlantic and transpacific bandwidth
have fallen dramatically with increased supply.[^7] It therefore seems
truly appropriate to adopt policies that would streamline our procedures
to expedite granting cable landing authority.

For these reasons, I support this initiation of a proceeding to identify
ways to promote competition in the operation of undersea cable systems,
and at the same time streamline our submarine cable licensing process.
The International Bureau has expended significant thought and effort in
crafting very specific proposals that would permit more expeditious
authorization of certain cable landing applications. I do not view these
proposals as the end product of our process. Instead, in opening this
proceeding, I hope that comment on these proposals will result in a
simpler, and more extensive, streamlining of our processes. The
Commission should try to avoid inadvertently raising the costs of
entering the undersea cable market in the course of "streamlining" its
processes. Thus, in addition to commenting on the efficacy of these
proposals, I encourage parties to suggest ways to make these
streamlining efforts more expansive.

[^1]: *AT&T Corp. et al.*, 14 FCC Rcd. 13066 (1999) (*JUS Order*).

[^2]: *Id*. at 13070-13073 ¶¶ 9-18.

[^3]: The Commission granted JUS CN its authorization after the
    applicants amended their Construction and Management Agreement to
    reduce the potential for competitive harms arising from the
    consortium structure. *Id*. at 13076-13079 ¶¶ 28-32.

[^4]: *Id*. at 13079 ¶ 36.

[^5]: FCC International Bureau, Report No. IN99-36, *1998 Section 43.82
    Circuit Status Data*, at 33-34 (1999).

[^6]: *Id*.

[^7]: *See*, *e.g.*, Bandwidth Index compiled by Band-X
    (http://www.band-x.com/bandwidth_1.cfm). Band-X runs an independent
    virtual market for international wholesale telecom capacity,
    maintaining price indices for bandwidth and switched minutes
    (http://www.band-x.com).