US FCC rejects Verizon petition to lift regulations
By Peter Kaplan
WASHINGTON, Dec 4 (Reuters) - U.S. communications regulators rejected a bid by Verizon Communications Inc (VZ.N) on Tuesday that would loosen regulations on the country's second-largest telephone company in some cities.
The Federal Communications Commission said it unanimously turned down a petition by Verizon to lift rules in six U.S. cities that require the company to let smaller rivals lease access to its network at a discount.
The decision was a victory for companies such as XO Communications, Cavalier Telephone, Covad Communications Group Inc DVW.A and EarthLink Inc (ELNK.O), which had urged the FCC to keep the rules in place.
Verizon's petition would have lifted the rules in New York, Boston, Philadelphia, Pittsburgh, Providence, Rhode Island, and Virginia Beach, Virginia.
The FCC's decision was applauded by Democratic Rep. Edward Markey, of Massachusetts, the chairman of the House Subcommittee on the Internet and Telecommunications.
Markey said granting Verizon's request would have led to higher prices for phone and Internet service in those areas.
At issue are rules imposed by Congress in 1996 to foster competition in the local phone services market. They require regional companies such as Verizon to let competitors lease access to their networks at a discount so they can provide service.
Smaller rivals argued the rules should be kept in place to preserve competition.
In its petition before the FCC, Verizon cited an FCC decision in 2005 that lifted the same regulations from Qwest Communications International Inc (Q.N) in Omaha, Nebraska.
Verizon argued the rules are no longer necessary because the market for local phone service is now fiercely competitive with the entry of cable companies and other new rivals.
Verizon executive vice president Tom Tauke said the agency had "missed an opportunity" because granting its request would have promoted competition among network operators. (Reporting by Peter Kaplan; Editing by Andre Grenon)
