February 26, 2002 -- AT&T, McLeodUSA and WorldCom late Friday filed a joint motion with the Indiana Utility Regulatory Commission (IURC) seeking to strike certain testimony of Ameritech Indiana (filed on Feb. 8), in which it proposes to nearly double loop rates that it charges competitors for leasing piece parts of its local network, known as unbundled network elements or UNEs.

The three competitive local exchange carriers (CLECs) feel that this Ameritech Indiana testimony should be stricken because it is beyond the scope of the current proceeding (Cause No. 40611-S1) before the IURC. In addition, the companies are asking the Commission for an expedited ruling on the issue by no later than March 6.

The UNE platform has been the only form of local entry that has generated mass-market competition in residential local phone markets such as in New York and Texas. UNEs are the piece parts of SBC/Ameritech's local network that competitors are entitled to lease under the federal Telecommunications Act of 1996 to provide local phone service in competition with Ameritech. The UNE platform allows competing carriers to lease all of the piece parts of Ameritech's local phone network in combination with each other, thus giving competitors access to the same network elements that Ameritech uses to serve its own retail customers.

In their joint petition, the CLECs point out that the Commission, in a proceeding started shortly after passage of the Telecom Act of 1996, was finally close to setting permanent wholesale rates for competitors to lease parts of Ameritech Indiana's local network. Cost-based wholesale rates would enable competitors to offer Indiana residential customers a choice of local phone service providers.

Ameritech Indiana is now attempting to double its price for local loops, rates that have already been declared "just and reasonable" by the Commission. The CLECs called this surprise tactic by Ameritech Indiana "particularly outrageous" and "unlawful." Coupled with Ameritech Indiana's recent attempts to get anti-competitive legislation passed (HB 1354), the CLECs see this as yet another example of Ameritech Indiana's coordinated activities designed to crush local phone competition in Indiana.

The three CLECs go on to say in their motion, "This maneuver would -- as Ameritech undoubtedly intended -- frustrate the roll-out of local competition for consumers." They say that the Commission must assure that the conclusion of this UNE proceeding and the resulting competition does not get derailed by Ameritech, and should do so by "rejecting Ameritech's transparent delay tactics."

"No CLEC can contemplate implementing a business plan for entry into the local market if the potential for loop rates doubling looms in the foreseeable future," the three companies conclude in their joint motion. This is especially true since Ameritech is proposing to charge competitors more than $15 a month to lease a loop, while it only charges its residential customers $11 a month for local service. "No CLEC can enter under such conditions. Ameritech knows this, and therefore made a calculated strategic decision to try to forestall the advance of local competition yet again, this time through attempting to convert this proceeding from the one established by the Commission to one of Ameritech's own anti-competitive making."

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