10/13. The Federal Communications Commission (FCC) furthered delayed adopting an order in its proceeding on the merger of AT&T and BellSouth.

Last week, the FCC announced that this item was on the agenda for its event titled "Open Meeting" scheduled for Thursday, October 12. The FCC held this event, but postponed its adoption of its AT&T BellSouth order, and its notice of inquiry (NOI) on broadband industry practices, until Friday, October 13, at 11:00 AM.

No Commissioners appeared at 11:00 AM, or thereafter, in the FCC's Commission Meeting Room. Later, FCC Commissioners Jonathan Adelstein and Michael Copps released a letter addressed to FCC Chairman Kevin Martin stating that they wanted the merger item to be postponed, to "allow the applicants to put forth their best proposals, and solicit expeditious public comment".

Just before 2:00 PM, Chairman Martin released a letter in response stating that "this proceeding will be taken off of the Sunshine to give you more time to evaluate the proposals". He added that "I have instructed staff to place these proposals out for public comment for a period of ten days."

Late on Friday, October 13, the FCC released this Public Notice [9 pages in PDF]. See also, following story titled "FCC Releases Public Notice Seeking Comments on AT&T's Proposed Conditions".

Finally, he wrote that "I have scheduled an open meeting of the Commission for November 3rd where we could consider this application again to the extent that the Commission has not completed its review of this transaction before then." (These two letters are set out in full below.)

Exchange of Letters. FCC Commissioners Jonathan Adelstein (at right) and Michael Copps, the two Democrats on the Commission, wrote a letter to FCC Chairman Kevin Martin, dated October 13. The entire body of the letter is quoted below.

"We write to you today to suggest next steps for moving forward with the Commission's review of the pending application for transfer of control filed by AT&T and BellSouth.

The proposed combination of AT&T and BellSouth would create the largest wireline, wireless and broadband company and would represent one of the largest mergers in history. More than ten thousand parties -- including Members of Congress, state officials, rural interests, consumer advocates, competitors, and thousands of individual citizens -- have urged the Commission to conduct a thorough review of this proposed transaction. Thus far, the record raises serious questions about whether this combination as proposed would satisfy the public interest, convenience, and necessity, our standard for review under the Act. Moreover, the Commission's review of this proposed combination is set against a backdrop of rapid consolidation and high levels of market concentration in the telecommunications industry.

Although we have concerns about whether it is appropriate for the Commission to conclude its consideration of this merger while the Federal courts are still reviewing the remedies imposed to address last years' telecommunications mergers, we have worked hard to engage in a dialogue about the concerns raised with respect to this merger and to explore potential ways to mitigate these concerns. We appreciate your efforts to engage in that dialogue and believe that we have made progress to date.

In the last 48 hours, new proposals were made for addressing the concerns raised in this proceeding. These proposals raise a number of significant questions and complex technical issues for us to consider. In light of these developments, we believe that the best way to advance the Commission's review is to open this process to public comment. Such an approach would facilitate a serious examination of the complex issues and proposals. This is particularly appropriate in light of recent concerns raised by interested parties, including the applicants, that they have been unable to engage in an open and transparent dialogue with us and Commission staff during the Sunshine period.

We specifically request that the Commission take this proceeding off of Sunshine, allow the applicants to put forth their best proposals, and solicit expeditious public comment so that we can receive a full record to inform the Commission's decision-making process. Such an approach is even more important because the Department of Justice approved this combination with little substantive analysis and only the day before we were scheduled to vote, making our task much harder. Given the limited analysis from our leading antitrust authorities, it is all the more imperative that we now employ an open process to fully involve all affected parties, including the applicants, in order to get the public and expert review that is otherwise lacking. Such an approach has its grounding in past Commission practices. In previous large ILEC-to-CLEC mergers, the Commission has sought comment on modifications to the applicants' initial public interest filings and even conducted public fora.

Public comment could be handled on an expeditious basis, need not cause unnecessary delay, and could be completed well in advance of the time frames used by the Commission to review other recent mergers. For example, to put this in context, we are still six months ahead of the time it took us to complete the Adelphia-Comcast-Time Warner merger, a transaction less than one-fifth the size of this one."

FCC Chairman Martin (at right) wrote back to Copps and Adelstein in a letter dated October 13. It was released in the Commission Meeting Room just before 2:00 PM. The following is the entire body of the letter.

"Thank you for your letter concerning next steps for moving forward with the Commission's review of the pending application for transfer of control filed by AT&T and BellSouth.

As referenced in your letter, proposals were put forward at your request in order to address concerns you expressed concerning the transaction. In keeping with the Commission's ex parte rules, I understand that the applications will update the record to reflect their efforts to respond to your requests.

Responding to the recommendations you put forth in your letter, this proceeding will be taken off of the Sunshine to give you more time to evaluate the proposals. I note that many of them have previously been filed by other parties and have been commented upon already. In any event, I have instructed staff to place these proposals out for public comment for a period of ten days.

I share your desire to proceed on an expedited basis. To this end, to the extent that you have additional concerns, I trust that you will extend us the courtesy of raising them as soon as possible to avoid any further delay in our consideration of this transaction.

Finally, I have scheduled an open meeting of the Commission for November 3rd where we could consider this application again to the extent that the Commission has not completed its review of this transaction before then.

I too believe that our recent dialogue has been constructive. Thank you for your cooperation."

FCC Procedure. FCC Commissioner Robert McDowell did not appear in the Commission Meeting Room on October 13. Neither he, Chairman Martin, nor anyone else at the FCC, has made a public statement regarding whether or not he is, or will be, recused from participating in the FCC's consideration of the merger of AT&T and BellSouth, on the basis of his work prior to joining the FCC.

On October 11, 2006, the Department of Justice's (DOJ) Antitrust Division announced its approval of AT&T's acquisition of BellSouth, without imposing any conditions. See, DOJ release and story titled "DOJ Approves AT&T BellSouth Merger" in TLJ Daily E-Mail Alert No. 1,466, October 11, 2006.

The FCC's proceedings regarding mergers of large communications and technology companies are nominally proceedings on the transfer of FCC licenses associated with the transactions. Nevertheless, the major substantive consideration of the FCC in these proceedings is its competition analysis. Hence, the FCC's proceedings are largely redundant of those conducted by the DOJ or Federal Trade Commission (FTC), and without express statutory authority.

The FCC is conducting this proceeding in a closed and non-transparent manner. The FCC could hold events that are in the nature of open meetings. It could meet, discuss, debate, hear testimony, draft and adopt an order in an open and transparent manner, including public access to, and webcasting of, the event. However, in this proceeding, as in most of its proceedings, the FCC chooses not to hold an open meeting. Its events titled "open meeting" are largely ceremonial events at which it adopts items that have previously been prepared in a closed and secretive manner. (And, it often adopts items that have not been drafted.) The Commissioners cannot by law meet in secret. However, the Commissioners evade this mandate by using their staff as intermediaries during their secret deliberations.

The exchange of letters on October 13 provide little guidance as to when the FCC will adopt its order in the AT&T BellSouth merger proceeding. However, it will not act for at least ten days. It might adopt an order after ten days, but before the November 3 meeting. It might adopt an order at the November 3 meeting. Or, it might adopt an order after November 3. The FCC might not act until after a sufficient period of time has elapsed to preclude any objection to Commissioner McDowell's participation.

In addition, Chairman Martin will leave the country on Saturday for a previously scheduled one week trip to Japan and the People's Republic of China.

Reaction. Rep. Joe Barton (R-TX), Chairman of the House Commerce Committee (HCC), and Sen. Ted Stevens (R-AK), Chairman of the Senate Commerce Committee (SCC), stated in a joint release that "AT&T and Bellsouth filed an application for transfer of control on March 31, 2006. More than six months have now transpired since that application was filed. The Federal Communications Commission has conducted a thorough review of the pro-competitive benefits presented by AT&T's acquisition of Bellsouth and has a complete record of comments from interested parties. In fact, at least 60 entities filed more than 10,000 initial and almost 600 reply comments."

They continued that "We are concerned by the commission's failure to act on the application this week after such a thorough review and a complete record. We certainly hope that the delays requested by members of the commission are substantive in nature, although the commission has had ample time to debate the merits of AT&T's acquisition of Bellsouth. The commission has a responsibility to act expeditiously on the AT&T-Bellsouth application so that consumers will have an opportunity to reap the benefits that will emanate from a stronger video and broadband provider in Bellsouth's nine-state region."

Gigi Sohn, head of the Public Knowledge, a Washington DC based interest group that advocates network neutrality mandates, stated in a release that "Commissioners Michael Copps and Jonathan Adelstein should be commended for their strong stand protecting consumers by forcing the FCC to delay consideration of the merger of AT&T and BellSouth, as well as the accompanying notice on Net Neutrality."

She added that "This deal and the Net Neutrality issue are too big to be rushed through the Commission, particularly considering that the Justice Department declined to attach any conditions to the merger."

The FCC's proceeding on the AT&T BellSouth merger is WC Docket No. 06-74.

The FCC has not announced a docket number for its yet to be adopted NOI on broadband industry practices.

10/13. The Federal Communications Commission (FCC) released a public notice [PDF] in its proceeding on the merger of AT&T and BellSouth.

It discloses, attaches, and seeks public comments upon, AT&T's letter proposal dated October 13, 2006. All comments are due by October 24, 2006. There is no reply comment period.

AT&T's letter proposal states that "the merger should be approved promptly without any conditions whatsoever", but "we would not object to the imposition of certain merger conditions", with a thirty month sunset, which are enumerated in the letter.

The following are excerpts from the letter. (All footnotes are omitted.)

"AT&T/BellSouth will not provide special access offerings to its wireline affiliates that are not available to other similarly situated special access customers on the same terms and conditions."

"AT&T/BellSouth also will not unreasonably discriminate in favor of its affiliates in establishing the terms and conditions for grooming special access facilities."

"By December 31, 2007, AT&T/BellSouth will offer broadband Internet access service (i.e., Internet access service at speeds in excess of 200 kbps in at least one direction) to 100 percent of the residential living units in the AT&T/BellSouth in-region territory."

"AT&T/BellSouth will provide an ADSL modem without charge (except for shipping and handling) to residential subscribers within the Wireline Buildout Area who, during calendar year 2007, replace their AT&T/BellSouth dial-up Internet access service with AT&T/BellSouth’s ADSL service and elect a term plan for their ADSL service of twelve months or greater."

"The AT&T and BellSouth incumbent LECs shall continue to offer and shall not seek any increase in State-approved rates for UNEs or collocation that are in effect as of the Merger Closing Date."

"Within twelve months of the Merger Closing Date, AT&T/BellSouth will deploy and offer within the BellSouth in-region territory ADSL service to ADSL-capable customers without requiring such customers to also purchase circuit switched voice grade telephone service. AT&T/BellSouth will continue to offer this service in each state for thirty months after the “implementation date” in that state."

"AT&T/BellSouth will offer to Internet service providers, for their provision of broadband Internet access service to ADSL-capable retail customer premises, ADSL transmission service in the combined AT&T/BellSouth territory that is functionally the same as the service AT&T offered within the AT&T in-region territory as of the Merger Closing Date. Such wholesale offering will be at prices comparable to those available in the overall market for wholesale broadband services."

The House will not meet. It may return from it elections recess on Monday, November 13, 2006. The adjournment resolution, HConRes 483, provides for returning on Thursday, November 9, at 2:00 PM.

The Senate will not meet. See, HConRes 483.

POSTPONED. 9:00 - 11:00 AM. The Progress & Freedom Foundation's (PFF) Digital Age Communications Act Project (DACA) will release a report containing recommendations of its Institutional Reform Working Group. The speakers will include Randolph May (Free State Foundation) and John Duffy (George Washington University School of Law). See, notice and registration page. See also, story titled "PFF Announces Digital Age Communications Act Project" in TLJ Daily E-Mail Alert No. 1,068, February 2, 2005. Breakfast will be served. Location: First Amendment Lounge, National Press Club, 529 14th St. NW, 13th Floor.

POSTPONED AGAIN. 11:00 AM. The Federal Communications Commission (FCC) will hold a meeting. The FCC may issue an order in its AT&T BellSouth merger review proceeding, and a notice of inquiry regarding broadband industry practices. See, notice [PDF]. The event will be webcast by the FCC. Location: FCC, 445 12th Street, SW, Room TW-C05 (Commission Meeting Room).

12:15 - 1:45 PM. The Federal Communications Bar Association's (FCBA) HLS/Emergency Communications Committee will host a brown bag lunch to plan future events. For more information contact Jennifer Manner at 703-390-2730 or jmanner at msvlp dot com. Location: Pillsbury Winthrop Shaw Pittman, 2400 N St., NW.

Day two of a two day conference titled "Standards Bodies and Patent Pools: Key Legal and Business Developments". See, notice and agenda. Location: Wyndham Washington DC Hotel, 1400 M St., NW.

6:00 - 8:15 PM. The Federal Communications Bar Association (FCBA) will host a continuing legal education (CLE) seminar titled "Client Creation, Conflicts and Confidentiality in the Administrative Process". The price to attend ranges from $50 to $125. See, registration form [PDF]. The deadline to register is 5:00 PM on October 12. Location: Wiley Rein & Fielding, 1776 K St., NW.

6:00 - 9:15 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled "How to Protect and Enforce Trademark Rights: A Primer". The speakers will include Shauna Wertheim (Roberts Mardula & Wertheim) and Steven Hollman (Hogan & Hartson). The price to attend ranges from $90-$135. For more information, call 202-626-3488. See, notice. Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 Level.

Deadline to submit comments to the European Commission (EC) in response to its public consultation regarding possible regulation of "the use of mobile phones by children and young people". The EC seeks comments "linked to content and behaviour, such as access to harmful or illegal content, bullying (e.g. distribution of abusive or compromising messages and photos amongst children), grooming (e.g. strangers “making friends” with children with a view to meeting them), risks to the privacy of children, and the risk of unexpectedly high expense." See, EC release.

6:00 - 8:15 PM. There will be a brown bag lunch titled "Deploying IP-based Services in Rural Areas". The Federal Communications Bar Association states that this event is hosted by Common Carrier Committee and IP-Based Communications Practice Committee will host a brown bag lunch. For more information, contact Andy Morentz at amorentz at gci dot com. Location: Federal Communications Commission (FCC), 6th Floor South Conference Room, 445 12th St., SW.

6:00 - 8:15 PM. The DC Bar Association will host a continuing legal education (CLE) seminar titled "Introduction to Export Controls". The speakers will include Thomas Scott (Weadon & Associates) and Carol Kalinoski (Kalinoski & Associates). The price to attend ranges from $90-$135. For more information, call 202-626-3488. See, notice and notice. Location: D.C. Bar Conference Center, 1250 H Street NW, B-1 Level.

Day one of a two day meeting of the Department of Labor's (DOL) Bureau of Labor Statistics' (BLS) Business Research Advisory Council (BRAC). See, notice in the Federal Register, October 2, 2006, Vol. 71, No. 190, at Pages 58013-58014. Location: Conference Center, Postal Square Building, 2 Massachusetts Ave., NE.

Day one of a two day conference hosted by the National Institute of Standards and Technology (NIST) titled "Moving Towards Interoperability -- Technologies for Affordable, Accessible Healthcare". See, notice. The price to attend is $195. Location: NIST, Red Auditorium, 100 Bureau Drive, Gaithersburg, MD.

12:30 - 2:00 PM. The DC Bar Association will host a panel discussion titled "Universal Service: What is on the Horizon?". The speakers will include James Reid (assistant to Sen. John Rockefeller (D-WV)), Paul Garnett (CTIA-The Wireless Association), Eric Einhorn (AT&T), Lisa Zaina (Exec. Dir. of the Independent Telephone and Telecommunications Alliance), and Kathleen Grillo (Verizon). The price to attend ranges from $15 to $20. For more information, call 202-626-3463. See, notice. Location: D.C. Bar Conference Center, 1250 H Street, NW, B-1 Level.

Day one of a two day event hosted by the Information Technology Association of America (ITAA) titled "ITAA Identity Management Conference 2006". See, notice. The speakers will include Rep. Tom Davis (R-VA), Robert Cresanti (Under Secretary of Commerce for Technology), and Frank Moss (Deputy Assistant Secretary Passport Services, Department of State). For more information, contact Jennifer Kerber at jkerber at itaa dot org. Location: Sheraton Premiere Tysons Corner, VA.

Day one of a three day convention of the American Intellectual Property Law Association (AIPLA) titled "2006 Annual Meeting". See, convention web site. Location: Marriott Wardman Park, 2660 Woodley Park Road, NW.

Day two of a two day meeting of the Department of Labor's (DOL) Bureau of Labor Statistics' (BLS) Business Research Advisory Council (BRAC). Some of the many items on the agenda may be technology related. On October 19, from 8:30 - 10:00 AM, the Committee on Productivity and Foreign Labor Statistics will meet. Its agenda includes "Update on manufacturing compensation costs in China and India", "Cross-Country Comparisons of Consumer Price Indexes", "Update on International Technical Cooperation", and "Are Those Who Bring Work Home Really Working Longer Hours?" See, notice in the Federal Register, October 2, 2006, Vol. 71, No. 190, at Pages 58013-58014. Location: Conference Center, Postal Square Building, 2 Massachusetts Ave., NE.

Day two of a two day conference hosted by the National Institute of Standards and Technology (NIST) titled "Moving Towards Interoperability -- Technologies for Affordable, Accessible Healthcare". See, notice. The price to attend is $195. Location: NIST, Red Auditorium, 100 Bureau Drive, Gaithersburg, MD.

12:00 NOON - 2:00 PM. The Progress and Freedom Foundation (PFF) will host a panel discussion titled "Copyright 'Modernization': What is the Agenda on Capitol Hill?" The speakers will included Patrick Ross (PFF) and Congressional staff. See, notice and registration page. Lunch will be served. Location: Room B-354, Rayburn Building.

Day two of a two day event hosted by the Information Technology Association of America (ITAA) titled "ITAA Identity Management Conference 2006". See, notice. The speakers will include Rep. Tom Davis (R-VA), Robert Cresanti (Under Secretary of Commerce for Technology), and Frank Moss (Deputy Assistant Secretary Passport Services, Department of State). For more information, contact Jennifer Kerber at jkerber at itaa dot org. Location: Sheraton Premiere Tysons Corner, VA.

Day two of a three day convention of the American Intellectual Property Law Association (AIPLA) titled "2006 Annual Meeting". Location: Marriott Wardman Park, 2660 Woodley Park Road, NW.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its notice of proposed rulemaking (NPRM) [77 pages in PDF] regarding the service rules that primarily govern wireless licenses in the 698-746, 747-762, and 777-792 MHz bands (700 MHz Band) currently occupied by television broadcasters and being made available for new services as a result of the DTV transition. This NPRM is FCC 06-114 in WT Docket No. 06-150, CC Docket No. 94-102, and WT Docket No. 01-309. The FCC adopted this NPRM on August 3, 2006, released it on August 10, 2006. See, notice in the Federal Register, August 21, 2006, Vol. 71, No. 161, at Pages 48506-48527, and notice in the Federal Register, September 29, 2006, Vol. 71, No. 189, at Pages 57455-57456. See also, FCC release [PDF] that describes this NPRM.

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division regarding its Draft Special Publication 800-94 [123 pages in PDF], titled "Guide to Intrusion Detection and Prevention (IDP) Systems".

Tech Law Journal publishes a free access web site and subscription e-mail alert. The basic rate for a subscription to the TLJ Daily E-Mail Alert is $250 per year. However, there are discounts for subscribers with multiple recipients. Free one month trial subscriptions are available. Also, free subscriptions are available for journalists, federal elected officials, and employees of the Congress, courts, and executive branch. The TLJ web site is free access. However, copies of the TLJ Daily E-Mail Alert are not published in the web site until one month after writing. See, subscription information page.

Contact: 202-364-8882.
P.O. Box 4851, Washington DC, 20008.

Privacy Policy
Notices & Disclaimers
Copyright 1998 - 2006 David Carney, dba Tech Law Journal. All rights reserved.