“AT&T Corp., WorldCom Inc. and other companies have taken advantage of the rules to sell local phone service to more than 10 million customers nationwide. By bundling local and long-distance services into aggressively priced packages, they have forced the Bells to drop prices in some states,” notes an unauthorized article in the February 20, 2003 issue of the Washington Post. This is exactly the type of “anti-competitive” notion the FCC has been on a quest to stop every since the divestiture of AT&T in 1984. But how exactly did the FCC plan to prevent, among other anomalies, price discrimination, misrepresentation, and unjustified raising this past February? The answer lies in the rule changes involving technology and line-sharing that it imposed recently.

The FCC addressed some issues pertaining to broadband. They removed the unbundling requirement for broadband fiber-to-the-home (FTTH) loops. This means that the ILEC is responsible for keeping, at all times, some way for the competitors to access the LEC’s narrowband service. In addition, they will require that line-sharing no longer be offered as an unbundled element. These two rules will respectively provide competitors with access to the ILEC’s broadband customers (increase revenue for competitors), and split the local loop for the two competing firms. Although there were other broadband issues addressed, these two rule changes will have the most resounding effect on competition in the market place because of the initial cost that a broadband company incurs at the outset of installation (it will be greatly reduced or eliminated completely), and the price that the firm will charge. According to 1Earth.net (http://www.1earth.net/prices/broadband.php), 256Kbit broadband internet access can run a consumer $79 per month for one company. That is a lot of money to pull in for a company without significant costs. To generate that much revenue with a lack of costs will help a new entrant build a foundation quite promptly.

In conclusion, by making changes to rules involving technology, line-sharing, and unbundling require

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