The Federal Communications Commission is supposed to be in the driver's seat when it comes to telecom reform. But don't tell that to the federal judiciary. Owing to the vagaries of the 1996 Telecommunications Reform Act, an overloaded FCC docket and the deep pockets and litigious nature of the carriers, federal judges are playing a big role in deciding which of the FCC's reform rule-makings actually take effect.
Cases in point: In a classic states rights battle, the 8th U.S. Circuit Court of Appeals in St. Louis, in July sided with the local exchange carriers (LEC) and the states in overturning key pricing provisions in an FCC order outlining rules for the interconnection of LEC networks and those of would-be competitors.
In October, the same court knocked out another piece of the interconnection order by ruling that the LECs don't have to rebundle so-called network elements that competitors have purchased separately. The result of the two rulings is to effectively stall a big portion of the telecom reform effort.
The FCC and the courts always have sparred. In July, the U.S. Court of Appeals for Washington, D.C., overturned one piece of an FCC order on pay phone rates, and the courts also have had their say on the issue of whether carriers must file tariffs.
The contradictory statements in the massive telecom reform bill give aggrieved companies plenty of room for legal play. And entrenched carriers have so much to lose with the advent of competition that they will jump on any opportunity to block reform in court.
So put the judges up there with the entrepreneurs, innovators and venture capitalists among the power players in the network industry.
