A Little Anti-Trust Rant

Peter : On Rad's Radar?
| Peter Radizeski of RAD-INFO, Inc. talking telecom, Cloud, VoIP, CLEC, and The Channel.

A Little Anti-Trust Rant

A CLEC filed suit against VZ for anti-trust this week. For those of you unfamiliar with operating a CLEC, ISP or OTT VoIP company, let me explain what I have seen over 11 years of servicing this industry.

Ma Bell has long standing promotions to compete against any quote from TWT. So long standing that by now they should be tariff rates.

Tariff is what the employees of the ILEC's consistently blame everything on. Tariffs are written by the ILEC and can be changed at will. Most of the ILEC services today are unregulated. Let me say that again: in most states even dial-tone is unregulated.

The ILEC's have systematically lobbied (read financially supported state and federal legislators) for de-regulation since 2004.

The ILEC's bill incorrectly in so many cases. Most CLEC bankruptcies result from billing controversy with the ILEC. In one case, a CLEC is routinely billed 10% wrong every month and the account exec doesn't even want to be bothered with fixing it. (It would be too difficult.)

I had a customer who had bought a frame circuit. It was in repair for a week. The ILEC tech told the end user that this would not have happened if he was a direct customer of the telco. How can that be? The line was down and the ILEC was having trouble fixing it. It was the ILEC's fault! (Unless the repair was caused by the ILEC.) 

Often the repair tech would tell the end user to move back to the ILEC. Apparently, the CWA doesn't understand that the ILEC receives more revenue from Wholesale than from Retail.

Take the case of DSL. ILEC's only have to offer it to ISP's and CLEC's if they want to through a commercial agreement. The price that an ISP pays for a DSL loop in much of the 22-state footprint of one ILEC is the same as the retail price. The ISP also has to pay for an Aggregation circuit for DSL plus the Internet bandwidth, the router, etc. Yet the ILEC can offer all that for less than the wholesale rate.

Metro Ethernet at the 10MB speed is priced at $720 as a Layer 2 service offering. With Internet, it is less than $900.

DSL loop qualification is funny as well. At Ma Bell there is the wholesale LQ system and the internal LOOPY2 for account reps. They give different results.

When VZ turns up a customer to FiOS, they cut the copper. This is because VZ doesn't want to maintain two outside plant facilities, but it also eliminates that customer from getting CLEC services. It is similar when a customer gets U-Verse; they are removed from the DSL database.

At least one MSO sells metro ethernet to CLEC's and ISP's, then goes to the end user and undercuts them to go direct. Why? I have no idea. They just lost revenue!

Over and over again, there are true stories about ILEC anti-competitive tactics over billing, repair, and CPNI violations.  COMPTEL should have been collecting these violations over their 30 year history. Imagine how much data they would have for Anti-Trust? In 2004, when I and others founded II4A and worked with the WBIA, we were trying to establish that database. Many of the independent ISP's didn't want to contribute to the database because they didn't think it would go any where. We used to file CPNI complaints with the FCC but they were ignored. (The FCC does not understand the word enforcement unless it's to fine someone for not filling out the right form on time. Again why do we spend the money for this Agency?)

Agents have had their own stories of woe with the carriers. Direct reps get better pricing. Dorect reps see the quote coming in and call the customer. Commission cuts. Yadda yadda.

AstroTel's anti-trust will be an uphill battle that will take years, sweat, stress and much, much money. The 3 cases that I have read about where an agent won a battle against a carrier took at least 6 years and close to $1M in legal fees, so good luck, AstroTel!

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