Cable Ops Slam AT&T Comp Critique

AT&T argues that there is a lot more involved in terminating circuit-switched service than interconnected VoIP
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Comcast, Time Warner Cable and Cox, the first, second and third largest cable operators in the country, told the FCC Monday that it was correct in concluding that disparate treatment of VoIP and traditional phone service when it came to intercarrier compensation for exchanging and terminating voice traffic was an impediment to broadband adoption and that all cable operators were looking for was fair compensation for similar service rendered.

In response to a filing by AT&T Friday, the cable operators said in a letter that the phone company was clinging to an "outdated and unworkable conception" of intercarrier comp, which is the rates carriers pay each other for handing off traffic.

AT&T argues that there is a lot more involved in terminating circuit-switched service than interconnected VoIP, which is why the compensation is not, and should not be, the same.

The cable ops said that "the voice services marketplace has moved irrevocably beyond the point when intercarrier compensation rules can be premised solely on the network architecture and circuit-switched technology employed by incumbent local exchange carriers." The bottom line, they said, is that AT&T "wishes to be compensated by Comcast, Cox, TWC, and other facilities-based providers of VoIP services for the transport and termination of interstate calls to end users on AT&T's local networks, but AT&T objects to paying the same compensation to those voice providers for furnishing the same transport and termination service to deliver AT&T interstate calls to end users on their local networks."

They pointed out that the FCC had said itself in proposing intercarrier compensation reforms that the current system "is impeding the transition to all-IP networks and distorting carriers' incentives to invest in new, efficient IP equipment." They argue that if incumbents continue to be compensated more for sticking with traditional service than transitioning to IP-based service, it creates a "compelling economic incentive" to continue using what the cable ops called "last-generation technology."

The FCC commissioners are said to be vetting a second draft of USF and intercarrier reforms in the run-up to a planned Oct. 27 vote on the rule changes. Although the so-called sunshine period that is meant to foreclose further comment began Friday, Oct. 21, Comcast points out that parties have one day -- in this case business day -- to respond to filings on the same day the sunshine period begins.

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