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Arizona Telecommunications & Information Council (ATIC)
Multitenant Building Telecommunications Access Study
Varying Points of View-- Building Managers and Owners

Varying Points of View:

Telecommunications Service Providers (TSPs):

In the local phone sector, we are starting to see the fruits of our pro-competitive policies. There are now at least twenty publicly traded CLECs with a total market capitalization of $33 billion. That compares with only six CLECs with a market capitalization of $1.3 billion at the time of the passage of the 1996 Act. In the first quarter of 1999 alone, almost a million CLEC access lines were installed.
 -- William E. Kennard, Chairman of the Federal Communications Commission at a hearing before the House Commerce Committee's Subcommittee on Telecommunications, Trade and Consumer Protection on October 26, 1999

Since the enactment of The Telecommunications Act of 1996, market forces have been unleashed, driven on by technological innovations, to create an increasingly competitive telecommunications marketplace with progressively more consumer choice. Federal Communication Commission (FCC) actions require the Incumbent Local Exchange Carriers (ILECs) to unbundle and provide wholesale competitive access to elements of their established and evolving networks and this is beginning to be success. Competitive Local Exchange Carriers (CLECs) are increasingly leasing the "last mile" circuits and other network elements supported by collocating equipment in the ILEC's Central Offices (COs), as well as deploying in-ground cable, wireless Points-of-Presence (POPs), and switching centers of their own. With the new FCC ruling requiring leasing of the high-band above voice circuits separately at lower incremental rates, CLECs will become more active in delivering Digital Subscriber Line (DSL) and other advanced services.

ILECs are connected to and able to provide service to nearly every physical structure in their geographic service regions, usually through legacy switching centers and in-ground wiring or consistent expectations that they be included in the plans for any new buildings. Facilities-based CLECs are increasingly deploying their own fiber-optic or wireless backbones, especially in the urban core areas of the state, and entering into contracts with the ILECs for interconnection, equipment collocation, and leased last-mile connections to business and residential customers. Some may also own national fiber-optic backbones themselves or contract to back-haul their traffic to the Internet, across the country, and around the world.

Fixed wireless technologies, point-to-point and point-to-multipoint, will flourish, as will satellite systems. Both may continue to rely on outside antennas, preferably rooftop mounted, usually requiring line-of-sight to the nearest wireless Point-of-Presence (POP). However, pending mobile wireless upgrades to Third Generation (3G) technologies will allow moderate to high roaming data rates servicing mobile information appliances, but also penetrating building walls to connect to relatively fixed locations, accessing networks, PCs, and peripherals.

Thus, the ILEC's historically have had virtually total access to multitenant building occupants for phone and data service. It often remains in their interest to delay the onslaught of CLEC access to their networks and facilities as best they can. But the deregulation of their monopolistic status requires that they increasingly provide this access. On the other hand, cable companies are still upgrading their Hybrid Fiber Coax (HFC) municipal infrastructure to offer data and voice services to consumers and can have holes in their service grid where upgrades or service extension are yet to be made, where small communities are serviced by regional cable operators or where multiple dwelling units (MDUs) are provided with a satellite-based community feed by the building owner or a contract provider. Building owners may themselves become telecommunications providers by wholesaling connectivity from the ILEC or CLECs and installing a PBX and billing systems to manage tenant telephone access. CLECs, more recent to the scene, continue to struggle to be everywhere they want to be, to build out their metropolitan area networks (MANs) and get access to the volume business telecommunications purchasers, often located in leased multitenant space.

The CLECs call for "open access" so that they may more broadly offer their competitive telecommunications services and achieve fair, reasonable, and nondiscriminatory access to potential consumers. They face significant "barriers to entry" and must either lease "last mile" network element connections from the ILEC or install an underground conduit/cable or rooftop antenna with access to the building interior to bridge the distance from the new customer to the CLEC's existing network. The building owner or manager often serves a gatekeeper role between the two, service provider and consumer, and must be made a party to the successfully connecting them. The exterior to interior building access paths and often the risers or conduit themselves may be the owner's property not covered in the tenant lease, with access needing to be specifically negotiated for each new providers' connections at a Point-of-Demarcation (POD). Competitive providers find any substantial delays or significant costs, either to initiate and sustain service, can prove off-putting, with the CLEC moving on to more accessible and cooperative prospects.

The facilities-based wireless CLECs don't have to usually dig up the streets and "lay cable," which can jump-start their deployment once they commit to a regional market. They then place one or more transmitters around the city, usually on leased tower space perhaps on high-rise buildings, for their Points-of-Presence (POPs) with broadband telecommunications access and their master antennas. Then, each customer needs to mount an external fixed antenna, either on the side of the building or more commonly mounted on the rooftop, connected by cabling to their wiring closet or other nexus of telephone and data networking cable.

ILECs customarily have legacy building access for their connection to all building tenants at little or no charge, due to the essential nature of the utility service they provide and the generally expected pervasiveness of telephony service in the modern world. CLECs want solutions to ease and accelerate multitenant building access by more clearly defining the Point-of-Demarcation (POD), precluding exclusive contract relationships between building owners and providers for tenant access, They understand they may have to pay some fee or percentage of revenue to the building owner, but they want those fees and terms to be nondiscriminatory, so all ILECs and CLECs have equal opportunity.

CLECs' policy and political actions on this issue may include seeking legislative relief from the U.S. Congress or individual state legislatures, while also engaging in a regulatory reform initiative at both the FCC and before individual state Public Utility Commissions (PUCs). The Courts remain a favorite recourse for the ILECs and CLECs as they seek to advance or forestall their causes. This ATIC study does recommend various appropriate actions for the legislative and regulatory bodies, which are detailed elsewhere. In general, ATIC encourages government policies and actions to help make multitenant building access fair, equal, and nondiscriminatory, while encouraging markets to become more orderly and hopefully less contentious and litigious.

Multitenant Building Telecommunications Access Study
Varying Points of View-- Building Managers and Owners