DOJ withholds support for SBC 271 applications

The United States Department of Justice (DOJ) announced yesterday that it would withhold its support for SBC Communications’ joint application to provide in-state long distance services in Arkansas and Missouri.

According to the Justice Department, “competitive entry in Missouri has not changed significantly” since SBC first filed its Section 271 application in April 2001. At the time the application was filed, competitors controlled about 296,000 access lines (about 10% of the total), a figure that has grown by just 1% in the interim. The DOJ attributed the marginal increase to CLEC growth in the business sector.

In Arkansas, CLEC activity is even less, according to the DOJ evaluation, which estimated that competitive carriers serve about 6% of total lines. However, nearly all of those are served via resale.

The DOJ also took issue with SBC’s pricing. Particularly vexing are the company’s interim rates, which the DOJ said are “troublingly high” and which have been left unresolved “for years.” Though the DOJ acknowledged SBC had lowered some of its permanent recurring and non-recurring rates as a result of criticism from CLECs that its rates in Missouri are too high, it concluded that, “selective rate reductions do not address the Department’s earlier concerns about the large number of interim rates in Missouri.”

In addition, the DOJ indicated it still had concerns regarding SBC’s operations support systems in the region, specifically erroneous records generated by the company’s loop maintenance operation system.

—Glenn Bischoff, senior writer