California PUC Should Maintain Jurisdiction over Pacific Bell and SBC Communications, say California ISPs; Coalition of ISPs Responds to SBC's Claim that CPUC Has No Authority.

Business Editors and High Tech Writers

SAN FRANCISCO--(BUSINESS WIRE)--Nov. 6, 2001

The California ISP Association (CISPA) filed a response today with the California Public Utilities Commission (CPUC) disputing SBC Communications' October 23 motion that the CPUC has no jurisdiction over SBC's DSL business activities in California. DSL -- or Digital Subscriber Line -- permits customers to obtain a high-speed Internet connection over existing telephone facilities.

"Now that SBC has leveraged their local phone monopoly into a statewide DSL monopoly, it wants to prevent the CPUC from exercising its authority to protect California consumers and businesses," said Mike Jackman, executive director of CISPA, which represents 130 Internet service providers in California. "The CPUC not only has the right to protect California consumers and businesses from unlawful business practices, it needs to assert its authority to prevent SBC from re-monopolizing the phone system."

"The federal Telecommunications Act of 1996, subsequent federal court decisions and California state law support the authority of the California PUC to regulate telecommunications and Internet services provided to California consumers and businesses," said Paul Neibergs of MBV Law LLP, a San Francisco-based law firm representing CISPA. "By applying to the CPUC and receiving a certificate of public convenience and necessity to provide DSL services in California, SBC has previously acknowledged the jurisdiction of the CPUC."

"By its own admission, SBC controls at least 90 percent of the DSL business in California," said Jackman. "Now SBC wants to remove one of the last regulatory protections for California residential and business customers."

CISPA's original complaint to the California PUC against SBC and Pacific Bell -- filed on July 26, 2001 -- seeks to ensure a truly competitive market in providing high-speed Internet services to California consumers and small businesses. The CISPA complaint outlined policies, anti-competitive conduct and contract terms that it says give an unfair advantage to Pacific Bell Internet and related companies owned by its parent, SBC Communications.

SBC has also asked the California PUC to allow it to enter the state's $15 billion long distance market. To get the CPUC's approval, SBC has to prove that SBC's control over California's telephone facilities properly supports competition among Internet service providers, including independent ISPs. CISPA's original complaint claims that SBC has failed to provide fair and non-discriminatory access to the phone networks.

About CISPA

The California Internet Service Providers Association, Inc. (CISPA) provides California's ISPs with a unified voice to address legislative and regulatory issues as well as to promote the ISP industry in general. CISPA's fundamental purpose is to ensure that all of California's ISPs receive reasonably priced non-discriminatory access to the networks of incumbent telephone companies and other carriers of Internet traffic, including cable systems. This includes reasonably priced and non-discriminatory access to DSL connectivity.