01-24042. Application by Verizon Pennsylvania Inc., Verizon Long Distance, Verizon Enterprise Solutions, Verizon Global Networks Inc., and Verizon Select Services Inc., Pursuant to Section 271 of the Telecommunications Act of 1996, for Authorization ...

AGENCY:

Federal Communications Commission.

ACTION:

Notice.

SUMMARY:

In this document the Federal Communications Commission grants the section 271 application of Verizon Pennsylvania Inc., et al. (Verizon) for authority to enter the interLATA telecommunications market in the state of Pennsylvania. The Commission grants Verizon's application based on our conclusion that Verizon has satisfied all of the statutory requirements for entry, and opened its local exchange markets to full competition.

DATES:

Effective date September 26, 2001.

FOR FURTHER INFORMATION CONTACT:

Robert Tanner, Attorney-Advisor, Policy and Program Planning Division, Common Carrier Bureau, [phone].

SUPPLEMENTARY INFORMATION:

This is a summary of the Commission's Memorandum Opinion and Order in CC Docket No. 01-138, FCC 01-269, released September 19, 2001. The complete text of this document is available for inspection and copying during normal business hours in the FCC Reference Information Center, Courtyard Level, 445 12th Street, SW., Washington, DC, and also may be purchased from the Commission's duplicating contractor, Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. It is also available on the Commission's website at http://www.fcc.gov/​ccb/​ppp/​2001ord.html.

Synopsis of the Order

1. On June 21, 2001, Verizon filed an application, pursuant to section 271 of the Communications Act of 1934, as amended, for authority to provide in-region, interLATA service in the state of Pennsylvania.

2. The State Commission's Evaluation. The Pennsylvania Public Utilities Commission (Pennsylvania Commission) advised the Commission, following months of extensive review, that Verizon met the checklist requirements of section 271(c) and has taken the statutorily required steps to open its local markets to competition. Consequently, the Pennsylvania Commission recommended that the Commission approve Verizon's in-region, interLATA entry in its June 25, 2001 evaluation of the application.

3. The Department of Justice's Evaluation. The Department of Justice does not oppose Verizon's section 271 application for Pennsylvania, but states that it is unable fully to endorse it due to concerns about Verizon's wholesale billing systems. The Department of Justice also states, however, that local markets in Pennsylvania show a substantial amount of competitive entry, and does not foreclose the possibility that the Commission may be able to approve Verizon's application.

Primary Issues in Dispute

4. Checklist Item 2—Unbundled Network Elements. Based on the record, the Commission finds that Verizon has provided “[n]ondiscriminatory 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 addresses herein those aspects of this checklist item that raised significant issues concerning whether Verizon's performance demonstrated compliance with the Act: (1) Operations Support Systems (OSS), particularly billing; (2) UNE pricing; and (3) provisioning of UNE combinations.

5. Access to Operations Support Systems (OSS). The Commission concludes that Verizon provides nondiscriminatory access to its OSS. Our decision focuses only on issues of controversy, particularly Verizon's wholesale billing functions. The Commission finds that, despite some historical problems in producing a readable, auditable and accurate wholesale bill, Verizon provides a wholesale bill that gives competitive LECs a meaningful opportunity to compete. Verizon demonstrates that recent data show significantly improved performance in delivering timely and accurate bills. Similarly, performance data indicate that any delay associated with BOS BDT bills was temporary, associated with on-going improvements to the billing process and not indicative of a larger, systemic problem with delivering timely bills. In addition, the Commission finds that third-party studies of Verizon's billing systems, processes and performance support Verizon's recent commercial data both for retail-formatted bills and BOS BDT formatted bills. The Commission therefore ultimately finds that Verizon's billing performance is minimally sufficient to demonstrate checklist compliance, especially in light of the showing Verizon has made for providing timely and accurate service usage information to competitive LECs.

6. Checklist Item 4—Unbundled Local Loops. Verizon has adequately demonstrated that it provides unbundled local loops in accordance with the requirements of section 271 and our rules. This conclusion is based on review of Verizon's performance for all loop types, which include, as in past section 271 orders, voice grade loops, hot cuts, xDSL-capable loops, digital loops, and high capacity loops, and our review of Verizon's processes for line sharing and line splitting. Upon review, the Commission finds that Verizon provides nondiscriminatory access to all loop types. It also finds that Verizon has demonstrated that it adequately provisions line-sharing and line-splitting. Furthermore, the Commission finds that Verizon provides access to loop makeup information in compliance with our rules.

7. Checklist Item 14—Resale. Section 271(c)(2)(B)(xiv) of the Act requires that a BOC make “telecommunications services * * * available for resale in accordance with the requirements of section 251(c)(4) and section 252 (d)(3).” Based on the record in this proceeding, the Commission concludes that Verizon satisfies the requirements of this checklist item in Pennsylvania. Verizon has a concrete and specific legal obligation in its interconnection agreements and tariffs to make its retail services available for resale to competing carriers at wholesale rates. Also, Verizon demonstrates current compliance with the checklist requirements with regard to DSL resale.

Other Checklist Items

8. Checklist Item 1—Interconnection. Section 271(c)(2)(B)(i) requires the BOC to provide equal-in-quality interconnection on terms and conditions that are just, reasonable and nondiscriminatory in accordance with the requirements of sections 251 and 252. Based on evidence in the record, the Commission concludes that Verizon demonstrates that it is in compliance with the requirements of this checklist item. The Commission also notes that the Pennsylvania Commission found that Verizon satisfied this checklist item and that no commenters raised any issues concerning Verizon's performance for the provisioning of interconnection.

9. Pricing. The Commission's pricing rules require, among other things, that in order to comply with its collocation obligations, an incumbent LEC provide collocation based on TELRIC. Based on the record, the Commission finds that Verizon offers interconnection in Pennsylvania to other telecommunications carriers at just, reasonable and nondiscriminatory rates and is therefore in compliance with checklist item

10. Checklist Item 8—White Pages Directory Listings. Section 271(c)(2)(B)(viii) of the competitive checklist requires a BOC to provide “[w]hite page directory listings for customers of the other carrier's telephone exchange service.” Based on the evidence in the record, we conclude that Verizon satisfies the requirements of checklist item 8.

11. Checklist Item 13—Reciprocal Compensation. Section 271(c)(2)(B)(xiii) of the Act requires that a BOC enter into “[r]eciprocal compensation arrangements in accordance with the requirements of section 252(d)(2).” In turn, section 252(d)(2)(A) specifies when a state commission may consider the terms and conditions for reciprocal compensation to be just and reasonable. Based on the record, we conclude that Verizon demonstrates that it provides reciprocal compensation as required by checklist item 13.

12. Remaining Checklist Items (3, 6, 7, and 9-12). An applicant under section 271 must demonstrate that it complies with checklist item 3 (access to poles, ducts, and conduits), item 6 (unbundled local switching), item 7 (911/E911 access and directory assistance/operator services), item 9 (numbering administration), item 10 (databases and associated signaling), item 11 (number portability), and item 12 (local dialing parity). Based on the evidence in the record, the Commission concludes that Verizon demonstrates that it is in compliance with checklist items 3, 6, 7, 9, 10, 11, and 12 in Pennsylvania. The Commission also notes that the Pennsylvania Commission concluded that Verizon complies with the requirements of each of these checklist items.

13. Compliance with Section 271(c)(1)(A). In order for the Commission to approve a BOC's application to provide in-region, interLATA services, a BOC must first demonstrate that it satisfies the requirements of either section 271(c)(1)(A) (Track A) or section 271(c)(1)(B) (Track B). To qualify for Track A, a BOC must have interconnection agreements with one or more competing providers of “telephone exchange service * * * to residential and business subscribers.” We conclude, as the Pennsylvania Commission did, that Verizon demonstrates that it satisfies the requirements of Track A based on the interconnection agreements it has implemented with competing carriers in Pennsylvania.

14. Section 272 Compliance. Based on the record, the Commission concludes that Verizon has demonstrated that it will comply with the requirements of section 272. Significantly, Verizon provides evidence that it maintains the same structural separation and nondiscrimination safeguards in Pennsylvania, as it does in Connecticut, New York and Massachusetts, states in which Verizon has already received section 271 authority.

15. Public Interest Analysis. The Commission concludes that approval of this application is consistent with the public interest. From extensive review of the competitive checklist, which embodies the critical elements of market entry under the Act, we find that barriers to competitive entry in the local exchange markets have been removed and the local exchange markets 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. The Commission also finds that the existing performance assurance plan (“PAP”) currently in place for Pennsylvania, in combination with other factors, provides assurance that the local market will remain open after Verizon receives section 271 authorization.

16. Section 271(d)(6) Enforcement Authority. The Commission has a responsibility not only to ensure that Verizon is in compliance with section 271 today, but also that it remains in compliance in the future. Working with the Pennsylvania Commission, the Commission intends to monitor closely post-entry compliance and to enforce the provisions of section 271 using the various enforcement tools Congress provided us in the Communications Act.

Federal Communications Commission.

Magalie Roman Salas,

Secretary.