FCC: ORAL ARGUMENTS SCHEDULED FOR OCT. 23 IN ARRL APPEAL OF FCC BPL RULES

This week, the U.S. Court of Appeals for the District of Columbia issued an Order scheduling oral arguments for October 23, 2007 at 9:30 a.m. in the appeal by the ARRL that challenges the FCC's BPL technical rules (06-1343). A Memorandum accompanying the Order stated that the amount of time for oral arguments would be scheduled in a later Order which should be issued approximately two weeks before the date that oral arguments are scheduled. UPLC will provide more details as they become available.

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FCC: VERIZON CALLS FOR PREEMPTION OF STATE REGULATION OF VOIP SERVICES

This month, Verizon fired a shot across the bow of the states in a letter to Chairman Martin that urged the FCC to preempt state regulation of all VoIP services (WC Docket No. 04-36, In the Matter of IP-enabled Services). Verizon noted that the FCC already has preempted state regulation of Vonage's VoIP services and the U.S. Court of Appeals for the 8th Circuit denied an appeal of that decision by the states. It stated that the "natural next step" is for the Commission to apply the same logic to preempt state regulation of any kind of VoIP services by any kind of VoIP provider. It claimed that FCC action is needed to discourage state attempts to regulate facilities-based VoIP services. "Despite the Commission's clear statements in the Vonage Order, its express intention to bring 'regulatory certainty' to this area, and its repeated reaffirmations of its 'determination that interconnected VoIP services are properly classified as interstate,' some continue to claim that legacy state regulations should apply to facilities-based, any-distance VoIP services." Verizon claimed that such state regulation would lead to patchwork regulation nationwide and prevent the creation of "a regulatory level playing field among broadband platforms." Verizon also urged the Commission to "ensure that its own rules establish a level regulatory playing field for all VoIP services," by eliminating any entry or rate regulation of VoIP services, as well as any division of VoIP services on a local or long-distance basis or equal access obligations.

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CONGRESS: COMMUNITY BROADBAND BILLS INTRODUCED IN SENATE AND HOUSE

On July 23, 2007 Sen. Frank R. Lautenberg (D-NJ) introduced a bill (S. 1853) to preserve the ability of local governments to provide broadband capability and services. The bill is supported by seven other senators. Soon thereafter, on August 1, 2007, Reps Rick Boucher (D-VA) and Fred Upton (R-MI) introduced a companion bill (H.R. 3281). Both Bills are entitled the "Community Broadband Act of 2007” and would preempt any state or local law, regulation or other requirement that would prohibit or effectively prohibit a public provider from providing broadband services. The Bills also would impose reciprocal requirements on public providers that regulate their competitors, requiring them to apply any ordinances, rules or policies on a non-discriminatory basis (i.e. on themselves, as well as competitors). The Bills also include provisions encouraging, but not requiring, public providers to partner with private entities. Additionally, the Bills require public providers to provide public notice
about their plans, prior to offering services themselves or in partnership with others. Existing public providers are exempt from this requirement. Also, if a public provider does not offer service to the public or is only offering service during an emergency, it is exempt from both the public notice requirement and the reciprocal obligation of non-discrimination. Both Bills have been referred to communications committees in the House and Senate.

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STATES: NEW YORK PSC APPROVES NGRID BPL AGREEMENT WITH NEW VISIONS

The New York Public Service Commission conditionally granted a joint petition by National Grid (NGRID) and New Visions Powerline Communications, Inc. to authorize the installation BPL in Geddes and Fairmount, NY. (Case 06-M- 1582). Under the terms of the grant, National Grid must share the revenues from the pole attachment fees and access charges from the initial installation on a 50/50 basis between shareholders and electric ratepayers. For areas outside the initial installation, the revenue split is 80/20. The PSC also required NGRID to file annual progress reports and to seek approval for expansions beyond the initial installation area. "This Order provides authorization for an initial commercial deployment in select areas of National Grid's service territory. This trial of the system may promote a better public understanding and acceptance of BPL operations, its integration with the electric system, and ability to avoid disruption of service to other customers and untoward effects on power quality and reliability."

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INDUSTRY: DIRECTV PARTNERS WITH CURRENT GROUP TO ENABLE BROADBAND AND
VOIP TO ITS CUSTOMERS

DirecTV, Inc. and CURRENT Group announced a wholesale distribution agreement that will enable DirecTV to offer its customers CURRENT's innovative BPL high-speed Internet service and VoIP services at the end of 2007/beginning of 2008. Under the deal, DirecTV will have access to CURRENT’s BPL network, initially in the Dallas/ Fort Worth area, that will cover approximately 1.8 million homes and businesses over the next several years. That will enable DirecTV to market a bundle that includes DirecTV high-speed Internet and VoIP services to its residential customers. In addition, the agreement provides DirecTV the ability to add other geographic markets as CURRENT builds out its network.



"Our agreement with CURRENT gives our customers another high-quality, easy-to-use option to pair broadband services with DIRECTV's video offerings," said Evan Grayer, vice president of Broadband for DIRECTV. “By choosing this bundled option, DIRECTV customers will now be able to enjoy fast, reliable and secure high-speed Internet service anywhere they have a power outlet in their homes.”



Reportedly, DirecTV has not decided pricing yet, but it has said that its bundled package of satellite TV, Internet and phone services will be competitive, compared with those offered by phone companies. DirecTV has entered into similar resale offerings with AT&T Inc., Verizon Communications Inc. and Qwest Communications International Inc. Liberty Media holds interests in both DirecTV and Current Group.



In response to the announcement, ARRL CEO David Sumner said "There is no reason to panic [over this decision]. ARRL's only concern about BPL is the interference potential. In that regard, the approach that Current has taken to date - limiting its use of the medium-voltage lines to 30-50 MHz and using the HomePlug standard to avoid the HF ham bands on the low-voltage drop -- has been satisfactory. If the FCC mandated what Current has been doing, we would be quite happy."



The BPL deployment in Dallas will be featured at the UPLC annual conference, September 18-21, 2007. If you haven't registered for the conference yet - good news – the early bird rate and the hotel cut-off has been extended until September 4, 2007. Don't wait any longer - register today! Visit www.bplconference.org [4] for more information.

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INDUSTRY: AMBIENT RAISES $7.5 MILLION

Ambient Corporation announced last month that it has closed on a private placement to an institutional investor of $7.5 million in principal amount of its newly issued 8% Senior Secured Convertible Note. The announcement came on the heels of a previous announcement reported in the UPLC PowerLine last month that Ambient had made its July 2007 payment on its 8% Senior Secured Convertible Debentures in cash and also pre-paid in cash an additional $1,952,700 of these Debentures.
Ambient disclosed that the institutional investor in this funding originally advanced Ambient a $4 million bridge loan that was announced on June 4, 2007, and has now rolled the short-term loan into a three-year Convertible Note. The Note is convertible into Ambient stock at $0.075.
Pursuant to the agreement, the Note matures on July 31, 2010, and requires no repayment of principal until the maturity date. Interest on the note does not begin accruing until July 2008; with first quarterly interest payment due in September 2008.



Commenting on the private placement, John J. Joyce, president and CEO of Ambient, stated, "This investment allows Ambient to continue advancing our deployments while meeting the goals and objectives set forth in our 2007 Annual Meeting of Stockholders."

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