Straight Talk on Tough Infrastructure Access Issues Charles A. ZdebskiEric B. Langley Troutman Sanders LLPBalch & Bingham LLP Washington, DCBirmingham, AL (202) (205) June 26, 2008

The Hot Issues Requests for Wireless Attachments, especially Distributed Antenna Systems (“DAS”) ILEC Relationships Getting the Telecom Rental Rate for Cable Phone Service Waiting for the FCC to Issue Its New Pole Attachment Rules

Background Pole Attachment Act –1978 Act –1996 Act –2007 FCC NPRM Who/What It Covers? State Certification

Wireless Attachments Wireless Attachments Under 47 U.S.C. §224, access to poles must be granted to “cable television systems” and “telecommunications carriers.” The U.S. Supreme Court has held that “telecommunications carriers” include wireless carriers as well as wireline carriers.

Wireless Attachments There is no rental rate formula for wireless attachments stated in the FCC’s rules. Most utilities charge some multiple of the telecom rate.

Typical Wireless Issues Typical Wireless Issues Whether to allow them at all (despite federal law). Whether to allow them at the top of the pole or confine them to the communications space. Whether to install taller poles or add pole-top extensions.

Wireless Attachments Wireless Attachments Clearly, wireless attachments requested by established cellular carriers must be allowed. But what about Distributed Antenna Systems – DASs?

What is DAS? A distributed antenna system (DAS) is a network of spatially separated antenna nodes connected to a common source via a transport medium that provides wireless service within a geographic area or structure. DAS nodes are remote radiating points interconnected to a base unit (a hub). Typically, a node comprises an antenna and a small radio head mounted on existing distributed structures, such as utility poles. DAS is a specialized solution where structural, spatial or architectural concerns make it impractical or infeasible to deploy traditional cell sites.

A DAS Node

But…Is DAS Entitled to Access at Regulated Rental Rate? But…Is DAS Entitled to Access at Regulated Rental Rate? Not unless the DAS provider is a (certificated) “telecommunications carrier.” Many DAS providers are tower companies, who are seeking to offer a “coverage solution” to their telecom customers.

The Open Question: The Open Question: Whether DAS providers gain access rights by virtue of their customers’ status as telecommunications carriers. May be answered in pending NPRM, discussed below.

ILEC Relationships History & Purpose –Infrastructure Cost Sharing –Savings for both parties –Duty to serve certificated areas Joint Use Agreements –Based on PARITY of ownership –Adjustment/rental rates –Freely negotiated Joint Ownership

ILEC Relationships ILECs are now in direct competition with other telephone & internet providers Economics: –CATV$7 –CLEC$15 –ILEC$35 ILECs setting fewer poles –Ownership imbalance –Paying more in adjustment rentals Consequences  ILECs re-identifying themselves as attachers rather than infrastructure owners

ILEC Relationships ILECs want: –Lower rental/adjustment rates –More favorable parity levels –Buy back poles at average embedded cost USTA Rulemaking petition (Fall 2005) –Message: we are entitled to rate protections in Pole Attachment Act –One of two petitions forming basis of pending rulemaking docket (WC Docket No ) PROGNOSTICATION

The Next Generation of Disputes with Cable: As cable companies move into wireless communications, look for them to take the position that their wireless attachments are entitled to the cable rate (if that rate still exists). Also look for a proliferation of unauthorized wireless attachments by cable companies as they acquire spectrum (e.g., SpectrumCo, a consortium of Comcast, Time Warner and other cable companies) or implement Wi-Fi or WiMax technologies and rush to compete with wireless services offered by telephone competitiors.

Getting the Telecom Rental Rate for Cable Phone Attachments Getting the Telecom Rental Rate for Cable Phone Attachments 47 U.S.C.§224(e)(1): “The Commission shall…prescribe charges for pole attachments used by telecommunications carriers to provide telecommunications services…” 47 C.F.R. §1.1409(e)(2): “…the [telecom] formula shall apply to all attachments to poles by any…cable operator providing telecommunications services…” 47 C.F.R. §1.1403(e): “Cable operators must notify pole owners upon offering telecommunications services.”

Cases Seeking the Telecom Rate for Cable Phone Attachments Cases Seeking the Telecom Rate for Cable Phone Attachments Comcast v. Georgia Power Tampa Electric v. Brighthouse Ameren v. Charter

NPRM: Background Only FCC pole attachment rulemaking in last decade –Released November 2007 –Published February 2008 Based on two petitions –USTA (regulated rates for ILECs) –Fibertech (new access rules) Only one real rule in NPRM (tentative): all broadband attachments at same rate (between Cable and Telecom Rate)

NPRM: At Stake? ILEC Relationships –Can the FCC regulate? –Should the FCC regulate? Access Rules –Regulation by rule vs. exception –“nationalization” of engineering standards –Unauthorized attachments Unification of broadband rate –Where will it land? –Legal and practical issues Wireless: access + rates

NPRM: Status Comments: –Initial  March 7, 2008 –Reply  April 22, 2008 Now in the ex parte phase Electric utilities well represented (filed comments + ex parte) Expectations: what & when? Consequences: will more states seek certification of pole attachment regulation?

QUESTIONS