FCC overruled on DSL unbundling

The move cuts across the policies of the powerful US regulator FCC, who wanted to encourage the big operators to build DSL networks to bring more bandwidth to consumers over the existing copper wires.

The commission felt that unless it did this the high costs involved would delay the rollout of high-speed consumer services.

Now, deals that the FCC had agreed on two takeovers - the SBC Communications purchase of Ameritech and Bell Atlantic's acquisition of GTE to form Verizon Communications - which would have allowed the carriers to put their DSL offerings in a separate company, have been dashed by the courts. Both companies will now be forced to open their networks to competitors in much the same way as BT is being forced to open the local loop in the UK.

The agreements made between the FCC and the two groups of companies were challenged by ailing telecoms giant AT&T as violating the 1996 Telecommunications Act which forced the large carriers and regional telephone companies to open their services to other companies.

The Federal appeals court has agreed and SBC Communications has said that it will be bringing the separate data subsidiary back into the parent company.