May 5, 2004 – Choice Communications lost its bid on Tuesday to have the Public Services Commission order Innovative Telephone to make its high-speed DS3 telephone lines available to Choice.
Choice, a local Internet service provider, has been seeking access to the broadband lines for two years from Innovative, which has refused to lease the lines to its competitor. A DS3 line, due to the size of its cable, allows the rapid transmission of large amounts of data, including voice messages. Innovative is the only company in the territory that has such lines.
The federal Telecommunications Act of 1996 opened up telecommunications markets to competition. The act requires existing telecommunications carriers, upon reasonable request, to interconnect directly with the facilities and equipment of other carriers.
In her recommendation to the PSC on Tuesday, hearing examiner Rosalie Simmonds Ballentine said Choice had failed to show a public demand or need for the service. Because of that, she said, "I recommend that this request be denied."
Robert Aamoth, legal counsel for Choice, said the DS3 service is needed because it is faster and more efficient.
Aamoth challenged Ballentine's contention that there is no demand for Choice to provide the such high-speed services. Banks, universities and other big businesses need the services, he said, adding: "You will cripple the V.I. economy if you dont develop the telecommunications system."
Aamoth also objected to a statement by Ballentine that Innovative might be put at a financial risk by providing the DS3 service to Choice. There is "absolutely no risk," he said, adding that Choice is willing to contract with Innovative to pay the phone company's costs for making the lines available.
"One can hardly resist the thought that they're unwilling to provide the DS3 service because Choice is their competitor," Maria Tankenson Hodge, another attorney for Choice, said of Innovative Telephone.
Greg Vogt, an Innovative attorney, urged the PSC to accept the hearing examiner's recommendation. "Choice is simply trying to get a break on the price it's paying for telecommunications service," he said. "All it's going to do is lower Innovative's revenue."
Vogt said Innovative is not "trying to hold down the competitive edge."
PSC member Alric Simmonds, who also is the governor's deputy chief of staff, put this question to Vogt: If more than one company requested the DS3 lines, would Innovative provide the access? Vogt answered yes.
The commission voted 4-2 to accept Ballantine's recommendation against ordering Innovative to provide Choice access to the DS3 lines. Verne David and Desmond Maynard dissented.
Some commission members said they would consider reversing their decision if Choice were to conduct a survey and then present findings demonstrating a public demand for the high-speed services.
Tuesday's action was not the first taken by the PSC in favor of Innovative Telephone and against Choice Communications interests.
In September 2001, the PSC rejected a request from Wireless World now part of Choice Communications that would have allowed it to enter the local telephone service market in competition with Innovative, which holds a monopoly in that regard. (See "PSC says no to local telephone competition".)
Last February, the PSC accepted Ballantine's opinion that the commission lacked jurisdiction to designate Choice an eligible telecommunications carrier and said the company could take its bid for carrier status to the Federal Communications Commission. Such status would make it eligible for rural-area federal subsidies such as Innovative Telephone receives. (See "Choice can go to FCC for status determination".)
Commission members present at Tuesday's meeting were Valencio Jackson, the chair; and Jerris Browne, David, Maynard, Simmonds, Alecia Wells and one non-voting member, Sen. Shawn-Michael Malone. The other non-voting member, Sen. Luther Renee, was absent.
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