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June 23, 1998

Separate Statement of Chairman William E. Kennard
PCIA's Broadband Personal Communications Services Alliance's Petition for Forbearance for Broadband Personal Communications Services

Today, the Commission takes an important step toward ensuring that the competition we are beginning to see emerge in the mobile telephony market will continue in a manner that benefits America's consumers. Based on the record presented in this proceeding, and information the Commission compiled in its Third Annual CMRS Competition Report, we wisely reject the request by the Personal Communications Industry Association ("PCIA") to forbear from core protections against discrimination and unfair dealing contained in sections 201 and 202 of the Communications Act. By rejecting this request, our decision today ensures that all American mobile telephony consumers will have the basic ability to obtain telecommunications service on no less favorable terms than other similarly situated customers, and not just those who live in markets characterized by widespread competition. Based on the centrality of these protections, which have served us well in both competitive and non-competitive contexts, it would be an abdication of our responsibility to consumers to rely simply on the workings of the market to ensure that America's consumers receive quality service at fair and reasonable prices.

At the same time, we take steps to ensure that prices charged by providers of mobile telephony services will continue their current downward trend by preserving the Commission's CMRS resale rule. This transitional rule, which will sunset five years after a date in the past that is to be noted in a future Public Notice, ensures that incumbent mobile telephony providers will be subject to price and service competition by resellers while their facilities-based competitors are building out their systems. The presence of resellers will serve to ensure that facilities-based carriers treat consumers fairly.

Our actions today also ensure that resale will continue as a viable strategy for entry into telecommunications by small and minority-owned businesses. These businesses, which often do not have the large amounts of capital needed to build out facilities, frequently are able to effectively serve niche or otherwise underserved markets. Many segments of our society would go unserved or underserved without them. Today's action also ensures that resellers will continue to operate in this market in a manner that benefits consumers.

Although I reject PCIA's petition to forbear from enforcement of Sections 201, 202 and the Commission's CMRS resale rule, I would like to reiterate my commitment to Commission forbearance from unnecessary regulation. I want to emphasize my interest in forbearance from enforcing provisions of our rules that inhibit or distort competition in the marketplace, represent unnecessary regulatory costs, or stand as obstacles to lower prices, greater service options, and higher quality services for American telecommunications consumers. I welcome future opportunities to extend the Commission's exercise of its forbearance authority in furtherance of these goals and, to that end, I note the Commission's decision to adopt a Notice of Proposed Rulemaking seeking comments on possible forbearance from additional provisions of our rules.

Section 10 of the Communications Act gives the Commission a powerful tool by allowing the Commission to forbear from the application of virtually any regulation or any provision of the Act to a telecommunications carrier or telecommunications service, or a class of carriers or services. Congress was clear in enunciating the specific test that must be applied by the Commission in its consideration of whether to forbear from the provisions of the Telecommunications Act or our regulations.(1) In this case, the record demonstrated that forbearance should be granted with regard to several of the provisions cited by the petitioners (certain tariffing requirements for international service offered directly to customers and certain requirements of Section 226 of the Telecommunications Act, TOSCIA (Telephone Operators Consumer Services Improvement Act)). However, the record clearly demonstrated that the Commission should not forbear on a national basis from enforcing sections 201 and 202, or the resale rule at this time. One-size-fits-all forbearance in this instance would not adequately protect consumers or the public's interest in robust competition. Although the record does not support forbearance on a national basis at this time, I would welcome future petitions to forbear from the CMRS resale rule for specific geographic markets based on the factors delineated in the Commission's Order. I encourage parties seeking future forbearance to submit specific showings and particularized evidence so that the Commission can analyze fully whether their requests satisfy each part of the test prescribed by Congress.

1. Under section 10, we must forbear from applying any regulation or provision of the Act to a telecommunications carrier or service, or class of telecommunications carriers or services, in any or some of its geographic markets, if a three-pronged test is met. Specifically, section 10 requires forbearance if the Commission determines that:

(1) enforcement of such regulation or provision is not necessary to ensure that the charges, practices, classifications, or regulations by, for, or in connection with that telecommunications carrier or telecommunications service are just and reasonable and are not unjustly or unreasonably discriminatory;

(2) enforcement of such regulation or provision is not necessary for the protection of consumers; and

(3) forbearance from applying such provision or regulation is consistent with the public interest.

47 U.S.C. 160(a)(1-3).