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Before the Federal Communications Commission Washington, D.C. 20554
In the Matter of Application by Qwest Communications International, Inc. for Authorization To Provide In-Region, InterLATA Services in the States of Colorado, Idaho, Iowa, Montana, Nebraska, North Dakota, Utah, Washington and Wyoming WC Docket No. 02 - 314
TO COLLECT ACCURATE DATA IN RELATIONSHIP TO QWEST’S (LONG DISTANCE) 271 APPLICATIONS.
Teletruth 826 Broadway, Suite 900, New York, NY 10003 212-777-5418
December 27th, 2002 ================================
GET YOUR NUMBERS STRAIGHT AND THEN TELL US THE TRUTH ABOUT COMPETITION IN THE QWEST STATES We are filing this complaint because the FCC has not done its job and made sure that the information that the companies are presenting, as well as the FCC’s own statistics, are correct and are consistent. As we will show, the statistics the FCC presents in its own reports, the information presented by Qwest in its annual and quarterly reports and the numbers presented in the FCC’s analysis of Qwest’s application to enter the long distance markets ----DO NOT MATCH. The FCC writes in their press release that granted Qwest’s entrance into long distance in 9 states: "Qwest stated in its application that competing carriers serve approximately 23% of all lines in Colorado, 11% of all lines in Idaho, 18% of all lines in Iowa, 6% of all lines in Montana, 32% of all lines in Nebraska, 22% of all lines in North Dakota, 23% of all lines in Utah, 19% of all lines in Washington, and 12% of all lines in Wyoming. With the FCC’s approval of Qwest’s nine state application, about 75% of Bell Operating Company (BOC) lines have been approved for in-region, interLATA service." Really? Let’s go through the numbers. First, the Qwest second quarter report, 2002 shows that the company had 17.4 million lines and that 910,000 are competitive --- about 5% Qwest 2nd Q 2002 Number of
Competitive Lines UNE-P and Unbundled
These calculations include ALL of the services, not just local phone service, or even local residential services, but also DSL, pay phones, and any other rented lines. In short, there may be little, if any, residential competition for local phone service in the Qwest territories. And notice the decline in lines. According to the Qwest 10K for 2001: "Total access lines declined by approximately 300,000 or 2% during 2001." The company has also been selling-off lines which can account for some of the declines: (source: 10K for 2001) "During 2001, Qwest sold approximately 41,000 access lines in Utah and Arizona resulting in a gain of $51 million and cash proceeds of $94 million. In 2000, the Company sold approximately 20,000 access lines in North Dakota and South Dakota resulting in proceeds of $19 million and a gain of $11 million." But it gets a lot worse. Let’s break down the materials the FCC presents and compare FCC stats with the Qwest information. Your own statistics are far off from the Qwest report stats. --- The total lines you believe Qwest had in 2000 was 23.9 million and going up in your 2001 report to 24 million lines.
Sources: Statistics of Communications Common Carriers Table 2.1 - List of Telephone Carriers Reporting to the Commission for the Year Ended December 31, 2000, Whose Reports Were Used in the Statistical Tabulations in Parts 1 and 2) published September 15th, 2001 (Statistics of Communications Common Carriers Table 2.1 - List of Telephone Carriers Reporting to the Commission for the Year Ended December 31, 2001, Whose Reports Were Used in the Statistical Tabulations in Parts 1 and 2) September 15, 2002 These statistics are off by 25% of the recorded amount in Qwest’s reports. But it gets worse when you look at the FCC state data, the percentage of competition stated by Qwest and the total number of lines. For example, according to the FCC’s state data, there are 2.78 million lines in Colorado. If Qwest had 23% of the states’ lines they’d have 640,467 competitive lines. Instead they have an undocumented 144,000 – a 345% difference. "State" is the FCC’s state information, "Amount Stated" is the information supplied in the press release for UNE and Unbundled combined.. State FCC
state % by
Qwest % by
Qwest amount
stated Difference CO 2,784,640 640,467.20
23% 143,793 345% ID 719,916 79,190.76
11% 16,121 391% IA 1,122,249 202,004.82
18% 136,305 48% MT 382,202 22,932.12
6% 8,196 180% NE 752,342 240,749.44
32% 21,830 1003% ND 211,032 46,427.04
22% 35,325 31% UT 1,088,465 250,346.95
23% 45,804 447% WA 3,514,424 667,740.56
19% 111,553 499% WY 265,631 31,875.72
12% 27,040 18% Total 10,840,901 2,181,734.61
18% 545,967
300% Source for FCC state info: (Statistics of Communications Common Carriers, September 15, 2002 Table 2.4 - Access Lines by Type of Customer for Reporting Incumbent Local Exchange Carriers as of December 31, 2001 Here’s more of the details from your Order
Here are the states that weren’t part of the release. AZ 2,900,860 MN 2,230,350 OR 1,986,614 NM 869,293 SD 263,104 Total 19,091,122 And even the Qwest information is inconsistent with itself ---If you assume that the these non-LD states had NO competition, then the total percentage of competition as stated by Qwest for all states would be 13% --- (i.e., talking all of the 9 states totals and dividing by 14, the total number of Qwest states). Clearly the difference in this information from Qwest contradicts its own Annual and quarterly reports. Pertaining to the FCC data, some of the differences can be attributed to the fact that the FCC state data includes the non-bell companies. You can also argue that the total percentage of states’ competition is different from the UNE-P numbers you give. However, with an average of 300% difference between the state data you provide and the information supplied by Qwest, you analysis is so flawed as to be unusable. Also, as you can see, when you add up the state FCC information, it comes to 19 million lines, not 24 million, and it still doesn’t match the information in the annual reports for access lines. Fundamental Flaw in Your Decision. The most important question that you did not answer is ---How many residential customers are using a competitor for their local phone service that is UNE-P or unbundled based? Besides the obvious problems with the statistics, the Telecom Act was written specifically to lower local phone rates through competition and the carrot for the Bell companies was to open their networks for local residential phone competition. If they did this, they would be allowed into long distance in that state. By saying that anything is competitive, you don’t fulfill the mandate of the Telecom Act--- The Act DID NOT state that we needed competition in long distance services. That was already proven to be highly competitive with more than 300 competitors, not to mention AT&T, MCI, Sprint, and IDT. However, you rewrote the Telecom Act’s principles by playing with the wording. You state:
Giving a monopoly more monopoly power is what you are doing, since it’s been proven that the Bell companies can use this market power to block competition. When someone calls the local phone company to get new phone service and an installation, the first offer for long distance is now from the Bell at the time of the person’s signup. This gives them an extreme advantage. When you consider that there is probably not enough local residential phone service customers who have a reasonable competitive offering – one with lower prices, then the entire process has be compromised and the customer is the ultimate loser. Bruce Kushnick, Teletruth 826 Broadway, Suite 900, New York, NY 10003 212-777-5418 |