California Internet service providers complained Thursday to state regulators that Pacific Bell and its affiliates are abusing their control over phone lines to squelch competition in the growing market for high-speed Internet access.
The California ISP Assn., which represents about 100 companies statewide, filed a formal complaint with the state Public Utilities Commission outlining policies and contract terms that give an unfair advantage to PacBell and related companies owned by its parent, SBC Communications Inc.
The ISP group asked regulators to prohibit SBC Advanced Solutions Inc., a PacBell sister company, from unilaterally enforcing new contracts for high-speed access Aug. 1. The group said the new contracts are one-sided and force ISPs to accept terms that put them at a competitive disadvantage.
The ISP group also seeks a PUC injunction to prohibit PacBell and SBC Advanced Solutions from disconnecting high-speed customers when they change Internet service providers. This practice, they claim, discourages customers from discontinuing service with PacBell's own ISP, called Pacific Bell Internet Services.
Under rules established by federal and state regulators, PacBell was required to create a separate company, SBC Advanced Solutions, to handle orders for digital subscriber line service, or DSL--a high-speed access service that works over standard copper phone lines.
SBC Advanced Solutions is supposed to treat orders from rival companies the same way it treats orders from its sister companies.
PacBell spokesman John Britton said the company is complying with the requirement. "Everybody's treated the same," he said. "There is one system, and the system works the same for every single ISP, including our own."
The Internet service providers cite a new contract from SBC Advanced Solutions that is being sent to all of its ISP customers. All DSL transport customers must sign the contract to continue getting service over PacBell's phone lines, which cover more than 80% of California.
Among other things, the contract raises the price for ISPs that want to maintain the connection speeds they currently buy. It also allows PacBell to immediately discontinue the ISP's DSL service if the user switches to a rival phone company for local phone service.
Attorneys for the ISP group say the terms have been presented to ISP customers as nonnegotiable, with the threat of discontinued service if they don't agree to the new terms.
David Simpson, an attorney representing the ISP group, said the companies fear that PacBell will ultimately dictate how DSL is provided statewide, as more and more competitors go out of business.
"Is it a competitive market when a company can go to its customers and say 'Buy under my terms or take a hike?' " Simpson said.
PacBell's Britton said the company is only setting forth terms of its relationship with the ISPs and that the terms are changing to reflect future uses for DSL.
The PUC has been deluged with complaints about DSL service. "If the allegations are true, then it's serious and we've got a problem because that would be anti-competitive," said Jeff Brown, a PUC commissioner.