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BACKGROUND - The U.S. Circuit Court of Appeals in the District of Columbia today issued decisions on two cases. The first rules on whether incumbent local telephone companies, like Verizon, must "unbundle" all of their network elements, as required by the Federal Communications Commission (FCC), to foster competition in the local telephone market and determines if the absence of certain network elements impairs competitors from competing for local telephone customers. The second ruling decides if incumbent local telephone companies should be required to share their telephone lines with competitors in the already competitive high-speed Internet marketplace. The following response should be attributed to Michael Glover, senior vice president and deputy general counsel for Verizon.
"Today's decision is good news for competition and lays out a roadmap for rules that will promote investment and economic growth.
"Verizon is pleased that the court of appeals recognized that the current overly broad unbundling requirements undermine investment and innovation by all competitors, and impose significant costs on the economy as a whole.
"The decision makes clear that unbundling requirements can be imposed only in specific market segments where there is proof that competitors truly need access to a particular element to enter and compete. Unbundling requirements cannot be justified where competitors already are using their own facilities to compete, as they do today using their own switches and high capacity transport.
"The biggest win for consumers is the court's recognition that unbundling requirements are especially unwarranted in the already competitive broadband market. In a world where cable companies are the dominant providers of broadband service, and there is increasing competition from satellite and wireless carriers, there's no justification for heaping additional requirements on the telephone companies that do not apply to the dominant providers.
"We look forward to working with the FCC to implement the court's decisions."
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