Rivals contest FCC's ruling on Verizon

Communications industry group asks a court to review decision to lift business broadband rules for Verizon.

A group representing telephone and Internet companies on Wednesday challenged action by U.S. regulators that freed Verizon Communications from rules on its broadband data services for businesses.

The Federal Communications Commission exempted Verizon from scores of regulations for its high-capacity data business services, including requirements that it connect to other networks and negotiate deals with competitors.

Comptel, which represents companies that compete against Verizon, and Sprint Nextel, asked the U.S. Court of Appeals for the District of Columbia to review the action last week by the Federal Communications Commission.

"We believe that the FCC has abdicated its responsibility to protect the public interest and instead has chosen to advance the private financial interests of a single giant corporation," said Jason Oxman, senior vice president for legal and international affairs at Comptel.

Sprint Nextel is concerned about whether the action affects network access prices. If it does, Chief Operating Officer Len Lauer said the company would "fight that vigorously."

"We're watching this like a hawk," he told investors at a Bank of America conference in New York on Wednesday. Sprint is spinning off its local phone unit to focus on wireless and long distance.

The two Democratic commissioners at the FCC had criticized the action, arguing it could result in higher prices and fewer choices for customers. FCC Chairman Kevin Martin, a Republican, had supported granting most of the relief the company requested.

Verizon, the No. 2 U.S. telephone carrier, won deregulation by filing a petition with the FCC, which was granted automatically after a 15-month waiting period expired with no steps by the agency to block it.

A representative for Verizon declined to comment, and a representative for the FCC had no immediate comment.

AT&T, the biggest U.S. carrier, has said it also plans to seek similar deregulation, as it competes with Verizon and others to offer services to lucrative business clients.

Analysts have valued the market for business telecommunications at roughly $150 billion.

Featured Video