FCC eases some broadband rules on AT&T

By Peter Kaplan

WASHINGTON (Reuters) - The Federal Communications Commission (FCC) voted late on Thursday to lift some regulations on AT&T's broadband business.

A divided FCC partially granted AT&T's request to relax rules that govern what the company can charge business customers and rivals for access to some of the its high-speed Internet lines.

"This relief will enable AT&T to have the flexibility to further deploy its broadband services and fiber facilities without overly burdensome regulations," FCC Chairman Kevin Martin said in a statement.

Under telecommunications law, the FCC has the authority to waive some regulations if it believes the market has become sufficiently competitive.

The FCC action will eliminate a key requirement that AT&T file tariffs with the agency disclosing the rates it charges businesses and rivals for high-speed access.

However, Republican commissioner Robert McDowell said the agency had left other key regulations in place and created a new process for handling complaints about the rates AT&T charges for access.

"With this partial grant of AT&T's ... petition, the commission is striking a thoughtful balance between deregulation and consumer protection," McDowell said in a statement.

The decision came shortly before a midnight deadline to act on AT&T's request. While the three Republicans on the commission voted in favor of it, the two Democratic commissioners dissented.

The two Democrats, Michael Copps and Jonathan Adelstein, said there was not enough evidence of competition to support AT&T's request. To the contrary, they cited indications that the market for high-speed access was "anything but competitive."

AT&T issued a statement praising the decision.

"We have not reviewed the order yet, but the FCC appears to have continued its successful pro-investment broadband policy, allowing for multiple providers to build out new wired and wireless networks to better compete for business customers," AT&T said in a statement.

David Kaut, an analyst with Stifel Nicolaus, said removing the tariff rules would give AT&T a leg up in negotiations with rivals and business customers seeking to lease access.

The FCC lifted regulations on Verizon Communications

high-speed business services last year. Verizon's petition was not approved by the agency, but went into effect when one commissioner recurescuedsed himself from the case and the remaining four were deadlocked.

A similar petition by Qwest Communications International is still pending before the agency. That company's request was put on hold by the FCC last month.