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Local (Residential) Landlines in Long Term Limbo?

It is no secret that many people have chosen to completely replace their landlines with wireless devices--and have done so for a number of very good reasons: Not only are wireless devices mobile, but you don't have to worry about making any changes when you relocate to a new residence. And of course smart phones, in particular, are much more than just telephones: They're capable of all sorts of sophisticated functions that the wired set at home just can't perform. Although I have no plans to take similar action, I understand why people make this decision.

On the consumer side, many individuals only want a single number. Additionally, they've come to rely on both the sophistication and convenience of a device that can do almost everything but brush your teeth (wait until Siri II).... Many of these people are not bothered by what I consider to be the four greatest vulnerabilities of wireless devices:

* Limited access to celluar and other wireless service in some areas
* Battery longevity
* Security issues
* Access to emergency services

And that's only once you have wireless service. Ask anyone who lives in rural America how reliable cellular dial tone can be when they're off the beaten path, and you'll get an earful. But for those of us who live and work in areas that are mostly covered by wireless access, the number of individuals opting for wireless-only is steadily increasing.

On the carrier side, incumbent LECs are getting pinched from two different directions. Incumbents often rightly argue that competitors have been able to "cherry pick" the profitable customers while leaving incumbents to bear the costs of maintaining aging wireline infrastructure. In the areas (read: neighborhoods) where there's money to be made, there's lots of competition and incentive for investment. In the areas where there's no money to be made (primarily rural), not only is there little--if any--competition and decreasing usage, but there are increasing costs associated with the maintenance of the physical plant. Replacement and repair are costly, time consuming and disruptive. If there's no return for the one incurring the expense (the ILEC), there's little incentive to tackle the work.

And yet the incumbents, up to now, have been forced to support these under-performing areas because they have traditionally had the legal obligation to serve as carriers of last resort or "COLRs." A COLR is defined as a telecommunications carrier that commits--or is required by law--to provide service to any customer in a service area that requests it--even if serving that customer would not be economically viable at prevailing rates. Now some of these COLRs are claiming--and the claim is not without merit--that they should no longer be required to provide such services to everyone within their service areas. In four states (FL, NC, TX and WI), these providers have already been relieved of these obligations. Additionally, in both Connecticut and Indiana, along with other states, proposals with similar goals are in front of the state legislatures.

Generally speaking, local service issues are within the purview of state public utility commissions and legislatures, although certainly the FCC and other federal agencies are paying attention to the steps that states are taking as ILECs seek to withdraw from this long-standing obligation. Aside from simply disconnecting rural customers who have fewer options for communications service, there are issues related to public safety that must also be considered when an ILEC wishes to step back from providing local services. One of the most critical issues for state legislatures to consider before allowing ILECs to pull back from providing local service is certainly the access to critical emergency services (fire, police, medical) that traditional landline service has provided. When seconds count--and they do--a wireless device may not be able to provide what the first responders call "location granularity." From where is the call being made? Even if the caller cannot speak, the location information provided by a traditional residential landline provides useful information that can make the difference when time is of the essence.

So when the states allow ILECs to step back from COLR responsibilities, who wins and who loses? The winners are the ILECs, who no longer have to invest in infrastructure for which they will likely never see positive returns. ILECs also argue that by freeing up the pot of money set aside for maintenance of tired facilities, they will be able to invest in new and developing technologies that can provide better and more sophisticated services to other consumers. This may well be true, although for those whose services will be restricted or eliminated, this is a less than compelling argument.

In a recent press release, AT&T claimed that such a move by the State of Connecticut would enable AT&T to create more jobs in the state (where the obligation to provide service wouldn't be completely eliminated—it's just that the pricing of those services would be freed from the shackles of regulated pricing). AT&T argues that the proposed state Telecommunications Modernization Bill (SB 447) would attract investment and grow jobs in Connecticut. AT&T may be correct. But if such investment in innovation comes at the expense of providing dial tone to rural residents who have few options, it may not be a good deal at all. (And consider the fact that Connecticut has less truly remote, rural territory than do larger states further west and south.)

What are the chances that someone else will step in to provide traditional landline service to rural areas if the incumbent carriers are relieved of their obligations? For those who argue that there are reliable alternatives to traditional landlines, a fair response is "it depends." Services driven by competitive technologies, like cable and satellite, for example, are not without risk. Cable services do not work in the event of a power failure (unlike corded handsets, which do provide dial-tone in the event of a power outage), and satellite-based services are subject to challenges posed by weather.

Furthermore, for all of the same reasons that ILECs want to be relieved of the obligation of providing COLR services, broadband access is not available to everyone in remote areas now, and this is unlikely to change in the near future.

My initial title for this piece was "cocktail party conversation," because I truly believe that this is one of those issues where it's possible to really understand both sides. For those who actively choose to live in rural areas, they understand the limitations. But for those who don't choose but are simply there (and this includes those living on Tribal lands) for any number of other reasons, is it in anyone's best interest to deny those people access to reliable, basic communications access? Particularly as the Connect America Fund rolls out, full of investment incentives to ensure deployment of broadband and other services in challenging areas, this seems an unusual time to allow COLRs to either cut or abandon the cord, discouraging landline use when for many it truly is a lifeline.