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 Federal  Communications  Commission  FCC  04-  241 
 STATEMENT  OF  COMMISSIONER  JONATHAN  S.  ADELSTEIN 


 Re:  Petition  of  Core  Communications,  Inc.  for  Forbearance  Under  47  U.  S.  C.  §  160(  c)  from  Application  of  the  ISP  Remand  Order,  WC  Docket  No.  03-  171,  Order 
 I  approve  in  part  and  dissent  in  part  from  this  Order  addressing  our  compensation  rules  for  traffic  destined  to  Internet  Service  Providers  (ISPs).  This  Order  largely  retains  our  current  rules  for 
 compensation  for  ISP-  bound  traffic  based  on  a  reasonable  application  of  the  statutory  forbearance  criteria.  The  Commission’s  existing  rules  were  designed  to  limit  opportunities  for  what  the  Commission  had 
 previously  characterized  as  regulatory  arbitrage. 
 I  dissent  in  part  from  the  Order,  however,  to  the  extent  that  it  grants  forbearance  from  two  prongs  of  the  Commission’s  rules  concerning  growth  caps  and  new  markets.  While  I  appreciate  competitive 
 carriers’  concern  about  the  application  of  these  rules  to  carriers  late  to  serve  the  ISP  market,  the  record  before  us  does  not  persuasively  suggest  that  the  bases  for  the  Commission’s  prior  concerns  about 
 opportunities  for  regulatory  arbitrage  and  disincentives  to  serve  non-  ISP  end-  user  customers  have  dissipated.  Though  commenters  argue  that  the  number  of  dial-  up  subscribers  has  declined  since  the 
 Commission  last  addressed  this  issue,  the  record  before  us  suggests  that  dial-  up  minutes  for  ISP-  bound  traffic  have  held  steady  or  are  increasing  in  many  areas  of  the  country.  More  broadly,  regulatory 
 treatment  of  this  traffic  raises  numerous  complex  issues  for  our  policies  regarding  local  competition,  access  to  the  Internet,  and  broadband  deployment.  These  issues  may  be  particularly  pronounced  for  many 
 rural  areas,  where  broadband  penetration  rates  may  be  lower  than  other  areas  of  the  country.  Given  the  present  record  and  these  larger  concerns,  I  would  not  have  granted  relief  at  this  time. 
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