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Thursday, April 29, 2004

AT&T's Proposal to "Negotiate not Litigate"
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The last major carrier to publicly reveal their negotiate not litigate strategy, AT&T released their "roadmap to facilities-based competition" today.

As with any opening offer in a negotiation, it is one that reaches for the stars. (To paraphrase Qwest's Dick Notebaert at our CEO luncheon yesterday, in the beginning of commercial negotiations "I want to take all of your margin, and you want to take all of mine.") For instance, the proposal would ensure that UNE-P will stay around for at least another six years and a $1 UNE-P rate increase would be locked into place until, among other things, a batch hot cut process is put into place by RBOCs.

AT&T's David Dorman is correct in stating that this is a "huge paradigm shift away from business as usual," but obviously it remains to be seen whether it is only a temporary one. AT&T has the most to lose in a non-regulatory solution, so it likely will be the last to make a deal. In light of Notebaert's comments at our luncheon yesterday on Qwest's "near death experience," its deal with Covad on line sharing and its announcement earlier this week that it will not charge terminating access on pure VoIP providers (a move that, incidentally, could give a boost to the Level 3 Forbearance petition), I view the Qwest/MCI negotiations currently taking place in Denver as the litmus test on whether the larger carriers will be able to avoid another round in the courts.

posted by @ 2:41 PM | General

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