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Ustabcoe Page 2 Of2, Internet Service Providers' Consortium Comments CC Docket Number 97-211

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Ustabcoe Page 2 Of2, Internet Service Providers' Consortium Comments CC Docket Number 97-211 ISP'& DOCKET ALE copy ORIGINAL March 20, 1998 Secretary, FCC 1919 M Street, NW Washington, D.C. 20554 Re: CC Docket #97-211 To the Federal Communications Commission: As the largest international trade association of ISPs representing 165 members in 42 states and 10 international countries, the Internet Service Providers' Consortium (ISP/C) has a strong interest in Internet matters presented before the Commission. Comprised primarily of small to mid-size regional providers, the ISP/C appreciates this opportunity to submit comments on behalf of our members in regard to the above docket number soliciting commentary on the proposed Worldcom-MCI merger. The ISP/C urges caution in FCC's assessment of the implications ofthis merger, in particular the possible anti-competitive aspects of concentrating such a large percentage of the Internet's "backbone" connectivity in one company. In principle and in practice, the ISP/C is strongly dedicated to encouraging free market enterprise and prevention ofmonopolistic business practices. As Worldcom already owns UUNet, Gridnet, and ANS, the addition of InternetMCI to their portfolio would mean that up to 50 percent of the backbone would be controlled by one corporate entity, with implications leading us to conclude there would be serious anti-competitive threats to our industry. Worldcom's UUNet division has made recent changes in its peering and pricing policies which lead us to be concerned about possible predatory actions in this regard. Furthermore, Worldcom has control of most of the peering points domestically through its MFS division, while international peering points are controlled by Worldcom's division of UUNet. This level of control of major peering points already concentrates an inordinate amount of power in one entity. If the merger is approved, we urge strong consideration to the divestment ofInternetMCI from the merger equation. In terms ofInternet transmission facilities, Worldcom sub-leases long-term fiber connections through long haul cable plants, providing rights of way and diverse path routing cross-leased to AT&T, Sprint, Savvis, Qwest, and other entities. Through Worldcom's control offiber transmission facilities and pipeline rights ofway, the extent oftheir underlying capacity poses a reasonable threat to a broad spectrum of traditional stratification in the telecommunications marketplace. c/o Lockridge Grindal Nauen & Holstein P.L.L.P. Suite 2200, 100 Washington Avenue South Minneapolis, Minnesota 55401 Telephone (612) 339-6900 No. OT Copies roc'd Od-l<f Facsimile (612) 339-0981 UstABCOE Page 2 of2, Internet Service Providers' Consortium Comments CC Docket Number 97-211 The aggregation ofservices provided by Worldcom presents a "one stop shopping model" that could harm competition on a number offronts. At the present time, the one and only fact separating Worldcom from being a total vertical and horizontal monopoly is their lack of presence in equipment manufacturing and customer premise equipment. If Worldcom were to enter the equipment market, they would effectively control and regulate competition in regard to Internet connectivity and would in effect be able to determine the market. The fact that Worldcom is effectively only one market away from complete domination of significant Internet industry segments is yet another indication to us of the strong need for additional scrutiny by the FCC in regard to the proposed acquisition ofMCI by Worldcom. Thank you for allowing us to make these brief comments. Should you have any questions, please do not hesitate to contact me at 310-448-1680. Sincerely yours, r/)~(j\~ Deborah A. Howard, MPH Chair ofthe Board and Executive Director on behalfofthe ISP/C cc: Janice Myles International Transcription Services, Inc. ISP/C Board ofDirectors ISP/C Members.
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