FCC Pushes for More Telephony, Video Competition in Apartment Buildings

The FCC this week amended its rules on telephony and video services in multi-unit buildings, in an effort to boost competition among new providers.

Specifically, the commission approved a petition from Cox Communications for a declaratory ruling on how much access a new entrant has to incumbent telephone companies' inside wire in apartment buildings.

The commission's decision essentially eliminates barriers to competitive entry in multidwelling units where a new entrant seeks to compete against an incumbent provider. The FCC said that competitive video service providers must not be forced to cut through sheet rock to connect their cable wiring to cable home wiring inside a unit. The commission found that wiring behind sheet rock is "physically inaccessible" for the purposes of inside wiring rules, like brick, cinder block and similar materials used to construct ceilings and hallways. The commission also said that new entrants in telephony must have access to the incumbent's inside wire subloops in multi-unit premises at the terminal block in order to install service. The inside wire loop typically is used by competing telephone companies to connect individual consumers in MDUs.

In clarifying the rules, the FCC is acknowledging the commission's increasing role in encouraging competition between cable operators, who are pushing VOiP telephony services, and telcos, such as Verizon and AT&T, which are heavily promoting IP-based video services. Last spring, Verizon, for example, launched its "Enhanced Communities" group, a major marketing campaign that involved sending the company's business development executives and engineers to meet with MDU owners and condominium/co-op associations to negotiate marketing and access agreements and technology upgrades. The telco, which is promoting its FiOS fiber-optic broadband service--estimates that the MDU market amounts to "about a fifth of Verizon's customer base," according to Eric Cevis, vice president of Verizon's Enhanced Communities Group. "We are intensifying our efforts, begun last year, to get FiOS services into the MDUs, and we expect this year to dwarf last year's MDU sales penetration," he said. Comcast, which is aggressively marketing its own Comcast Digital Voice VOiP service, announced in March that it had passed the two million subscriber mark.

Herndon, Va.-based broadband provider RCN applauded the commission's decision. "This is a significant victory for consumers living in multi-unit buildings who want a competitive choice in video, voice and data," said Peter Acquino, president and CEO of RCN.