03-9825. Application by SBC Communications Inc., Nevada Bell Telephone Company, and Southwestern Bell Communications Services, Inc., for Authorization To Provide In-Region, InterLATA Service in Nevada

AGENCY:

Federal Communications Commission.

ACTION:

Notice.

SUMMARY:

In the document, the Federal Communications Commission (Commission) grants the section 271 application of SBC Communications Inc., Nevada Bell Telephone Company, and Southwestern Bell Communications Services, Inc., (Nevada Bell) for authority to enter the interLATA telecommunications market in Nevada. The Commission grants Nevada Bell's application based on its conclusion that it has satisfied all of the statutory requirements for entry and opened its local exchange markets to full competition.

DATES:

Effective April 25, 2003.

FOR FURTHER INFORMATION CONTACT:

Pam Arluk, Attorney-Advisor, Wireline Competition Bureau, at [phone] or via the Internet at [e-mail]. The complete text of this Memorandum Opinion and Order is available for inspection and copying during normal business hours in the FCC Reference Information Center, Portals II, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. Further information may also be obtained by calling the Wireline Competition Bureau's TTY number: [phone].

SUPPLEMENTARY INFORMATION:

This is a summary of the Commission's Memorandum Opinion and Order in WC Docket No. 03-10, FCC 03-80, adopted April 14, 2003, and released April 14, 2003. The full text of this order may be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone [phone], facsimile 202-863-2898, or via e-mail [e-mail]. It is also available on the Commission's Web site at http://www.fcc.gov/​Bureaus/​ Wireline_​Competition/​in-region_​applications.

Synopsis of the Order

1. History of the Application. On January 14, 2003, Nevada Bell filed an application pursuant to section 271 of the Telecommunications Act of 1996, with the Commission to provide in-region, interLATA service in the state of Nevada.

2. The State Commission's Evaluation. The Nevada Public Utilities Commission (Nevada Commission), following an extensive review process, advised the Commission that Nevada Bell has taken the statutorily required steps to open its local markets to competition. Consequently, the Nevada Commission recommended that the Commission approve Nevada Bell's in-region, interLATA entry in their evaluation and comments in this proceeding.

3. The Department of Justice's Evaluation. The Department of Justice filed its evaluation on February 21, 2003, recommending approval of the Nevada Bell application. The Department of Justice concludes that opportunities are available for competitive carriers to serve business customers, and also concludes that Nevada Bell has fulfilled its obligations to open its markets to residential competition. Accordingly, the Department of Justice recommends approval of Nevada Bell's application for section 271 authority in Nevada.

Primary Issues in Dispute

4. Complete-As-Filed Waiver. The Commission's “complete-as-filed” requirement provides that when an applicant files new information after the comment date, the Commission reserves the right to start the 90-day review period again or to accord such information no weight in determining section 271 compliance. The Commission waives the complete-as-filed requirement pursuant to Nevada Bell's request to consider its late-filed Track A evidence. The Applicant submitted additional evidence to respond quickly and positively to concerns raised in the record as to whether Cricket Communications' broadband Personal Communications Service (PCS) offering satisfied the requirements of Track A. Because the evidence was filed on day 31, the Bureau had sufficient time to place the evidence on public notice and request comments specific to the evidence submitted. Under these circumstances, the Commission believes that consideration of Nevada Bell's additional evidence better serves the Commission's interest in ensuring a fair and orderly 271 process than restarting the 90-day clock, and that a grant of this waiver will serve the public interest.

5. Compliance with Section 271(c)(1)(A). The Commission concludes that Nevada Bell demonstrates that it satisfies the requirements of section 271(c)(1)(A) based on the interconnection agreements it has implemented with competing carriers in Nevada. The record shows that Nevada Bell relies on interconnection agreements with Advanced Telecom Group, WorldCom, and Cricket Communications in support of this showing. The Commission finds that Advanced Telecom Group and WorldCom each serve more than a de minimis number of business end users predominantly over their own facilities and represent “actual commercial alternatives” to Nevada Bell for business telephone exchange services. The Commission further finds that, Cricket Communications, a PCS provider, serves more than a de minimis number of residential users over its own facilities and, for purposes of section 271 compliance, represents an actual commercial alternative to Nevada Bell for residential telephone exchange services.

6. First, the Commission determines that Cricket Communications' residential broadband PCS offering in Nevada is a “telephone exchange service” for purposes of Track A. The Commission further concludes that the evidence submitted by Nevada Bell adequately demonstrates that more than a de minimis number of Cricket customers use their service in lieu of wireline telephone service. The evidence shows that Cricket's marketing efforts stress that its product is a substitute for residential local telephone service. In addition, the Commission concludes that Nevada Bell's survey also demonstrates that Cricket customers use Cricket service in lieu of wireline telephone service. The Commission finds that the survey was random, and contains statistical analysis of sufficient quality to allow the Commission to rely on it for the purpose of showing compliance with Track A.

7. Checklist Item 2—Unbundled Network Elements. Based on the record, the Commission finds that Nevada Bell has provided “nondiscriminatory access to network elements in accordance with the requirements of sections 251(c)(3) and 252(d)(1)” of the Act in compliance with checklist item 2.

8. Pricing of Unbundled Network Elements. Based on the record, the Commission finds that Nevada Bell's UNE rates in Nevada are just, reasonable and nondiscriminatory as required by section 251(d)(1). The Commission has previously held that it will not conduct a de novo review of a state's pricing determinations and will reject an application only if either “basic TELRIC principles are violated or the state commission makes clear errors in the actual findings on matters so substantial that the end result falls outside the range that a reasonable application of TELRIC principles would produce.” The Nevada Commission conducted extensive pricing proceedings to establish wholesale rates for UNEs. It approved recurring rates by using a Nevada specific version of the HAI model advocated by AT&T. Competitive LECs agreed to the vast majority of the nonrecurring rates. The Nevada Commission concluded that Nevada Bell's UNE rates are just, reasonable, and nondiscriminatory as required by section 251(c)(3), and satisfy the requirements of checklist item two. No party alleges that Nevada Bell's rates are inconsistent with TELRIC, or that the Nevada Commission committed TELRIC errors. Based on this record, the Commission finds that Nevada Bell has met its burden to show that its prices for UNEs satisfy the statutory mandate.

9. Operations Support Systems (OSS). Based on the record, the Commission finds that Nevada Bell provides “nondiscriminatory access to network elements in accordance with the requirements of sections 251(c)(3) and 252(d)(1)” of the Act in compliance with checklist item 2. The Commission further finds that Nevada Bell provides persuasive evidence that the OSS in California are substantially the same as the OSS in Nevada and, therefore, evidence concerning the OSS in California is relevant and should be considered in our evaluation of the OSS in Nevada. Accordingly, when volumes in Nevada are too low to yield meaningful information concerning Nevada Bell's compliance with the competitive checklist, the Commission examines data reflecting Pacific Bell's performance in California.

10. Pursuant to its analysis, the Commission finds that Nevada Bell provides non-discriminatory access to its OSS—the systems, databases, and personnel necessary to support network elements or services. Nondiscriminatory access to OSS ensures that new entrants have the ability to order service for their customers and communicate effectively with Nevada Bell regarding basic activities such as placing orders and providing maintenance and repair services for customers. The Commission finds that, for each of the primary OSS functions (pre-ordering, ordering, provisioning, maintenance and repair, and billing, as well as change management), Nevada Bell provides access to its OSS in a manner that enables competing carriers to perform the functions in substantially the same time and manner as Nevada Bell does or, if no appropriate retail analogue exists within Nevada Bell's systems, in a manner that permits competitors a meaningful opportunity to compete. In addition, regarding specific areas where the Commission identifies issues with Nevada Bell's or Pacific Bell's OSS performance, these problems are not sufficient to warrant a finding of checklist noncompliance.

Other Checklist Items

11. Checklist Item 4—Unbundled Local Loops. Based on the evidence in the record, the Commission concludes that Nevada Bell provides unbundled local loops in accordance with the requirements of section 271 and our rules. The Commission also notes that no commenter challenges Nevada Bell's showing on this checklist item or the California evidence that it relies upon. The Commission's conclusion is based on Nevada Bell's performance (and Pacific Bell's performance in California where Nevada volumes are low) for all loop types, which include, as in past section 271 orders, voice grade loops, hot cut provisioning, xDSL-capable loops, digital loops, high capacity loops, as well as our review of Nevada Bell's processes for line sharing and line splitting.

12. Checklist Item 1—Interconnection. Based on the Commission's review of the record, it concludes that Nevada Bell complies with the requirements of checklist item 1. In reaching this conclusion, the Commission examined Nevada Bell's performance with respect to collocation and interconnection trunks, as the Commission has done in prior section 271 proceedings. For the one performance measure that the Commission noted that Nevada Bell failed four of the five-month data period, the failures were not sufficient to warrant a finding of checklist noncompliance.

13. Remaining Checklist Items (3, 5-14). In addition to showing that it is in compliance with the requirements discussed above, an application under section 271 must demonstrate that it complies with checklist item 3 (access to poles, ducts, and conduits), item 5 (unbundled transport), item 6 (local switching unbundled from transport), item 7 (911/E911 access and directory assistance/operator services), item 8 (white pages directory listings), item 9 (numbering administration), item 10 (databases and associated signaling), item 11 (number portability), item 12 (local dialing parity), item 13 (reciprocal compensation), and item 14 (resale). Based on the evidence in the record, the Commission concludes that Nevada Bell demonstrates that it is in compliance with these checklist items in Nevada. It notes that no party objects to Nevada Bell's compliance with these checklist items.

14. Section 272 Compliance. Based on the record, the Commission concludes that Nevada Bell has demonstrated that it will comply with the requirements of section 272. Significantly, Nevada Bell provides evidence that it maintains the same structural separation and nondiscrimination safeguards in Nevada as it does in California.

15. Public Interest Analysis. The Commission concludes that approval of this application is consistent with the public interest. From its extensive review of the competitive checklist, which embodies the critical elements of market entry under the Act, the Commission finds that barriers to competitive entry in the local exchange markets have been removed and the local exchange markets in Nevada today are open to competition. The Commission further finds that the record confirms our view, as noted in prior section 271 orders, that BOC entry into the long distance market will benefit consumers and competition if the relevant local exchange market is open to competition consistent with the competitive checklist.

16. Section 271(d)(6) Enforcement Authority. Working with the Nevada Commission, the Commission intends to closely monitor Nevada Bell's post-approval compliance to ensure that Nevada Bell continues to meet the conditions required for section 271 approval. It stands ready to exercise its various statutory enforcement powers quickly and decisively in appropriate circumstances to ensure that the local market remains open in Nevada.

Federal Communications Commission.

Marlene H. Dortch,

Secretary.