[Federal Register Volume 61, Number 144 (Thursday, July 25, 1996)]
[Rules and Regulations]
[Pages 38605-38642]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-18477]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 20 and 52

[CC Docket No. 95-116; FCC 96-286]


Telephone Number Portability

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: On June 13, 1995, The Commission adopted a notice of proposed 
rulemaking (CC Docket No. 95-116) regarding telephone number 
portability . The First Report and Order released July 2, 1996, 
promulgates rules and regulations implementing the statutory 
requirement that local exchange carriers (LECs) provide number 
portability as set forth in section 251 of the Telecommunications Act 
of 1996 (1996 Act). The Report and Order mandates the implementation of 
number portability by LECs, consistent with the procompetitive goals of 
the Telecommunications Act of 1996. Concurrently with the adoption of 
the Report and Order, the Commission adopted a Further Notice of 
Proposed Rulemaking which is published elsewhere in this issue.

EFFECTIVE DATE: August 26, 1996.

FOR FURTHER INFORMATION CONTACT: Jason Karp, Attorney, Common Carrier 
Bureau, Policy and Program Planning Division, (202) 418-1517, or Mindy 
Littell, Attorney, Common Carrier Bureau, Policy and Program Planning 
Division, (202) 418-1394. For additional information concerning the 
information collections contained in this Report and Order contact 
Dorothy Conway at 202-418-0217, or via the Internet at [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's First 
Report and Order adopted June 27, 1996, and released July 2, 1996. The 
full text of this First Report and Order is available for inspection 
and copying during normal business hours in the FCC Reference Center 
(Room 239), 1919 M St., NW., Washington, DC. The complete text also may 
be obtained through the World Wide Web, at http://www.fcc.gov/Bureaus/
Common Carrier/Orders/fcc96286.wp, or may be purchased from the 
Commission's copy contractor, International Transcription Service, 
Inc., (202) 857-3800, 2100 M St., NW., Suite 140, Washington, DC 20037. 
Pursuant to Section 251, the Report and Order establishes performance 
criteria for acceptable long-term number portability methods and 
requires all LECs to begin deploying number portability in the 100 
largest Metropolitan Statistical Areas (MSAs) no later than October 1, 
1997, and to complete deployment in those MSAs by December 31, 1998, in 
accordance with a phased schedule. Number portability must be provided 
in these areas by all LECs to all telecommunications carriers, 
including commercial mobile radio services (CMRS) providers. In 
addition, pursuant to the Commission's independent authority under 
sections 1, 2, 4(i) and 332 of the Communications Act of 1934, as 
amended, the Report and Order requires all cellular, broadband personal 
communications services (PCS) and covered Specialized Mobile Radio 
(SMR) service providers to be able to deliver calls from their networks 
to ported numbers anywhere in the country by December 31, 1998, and 
requires cellular, broadband PCS and covered SMR customers to be able 
to move their own numbers to other carriers by June 30, 1999. In the 
Report and Order, the Commission delegates responsibility to the North 
American Numbering Council (NANC) to oversee the initial administration 
of the system of regional databases which will be used by carriers to 
provide number portability. Pursuant to the 1996 Act, the Commission 
also requires LECs to provide currently available number portability 
measures upon specific request from another carrier until long-term 
number portability is available. However, the Report and Order 
concludes that CMRS providers need not provide such measures due to 
technical considerations specific to the CMRS industry. In addition, 
consistent with section 251(e)(2) of the Telecommunications Act of 
1996, the Report and Order sets forth principles that ensure that the 
costs of currently available measures are borne by all 
telecommunications carriers on a competitively neutral basis, and 
permits states to utilize various cost recovery mechanisms, so long as 
they are

[[Page 38606]]

consistent with these statutory requirements.

Regulatory Flexibility Analysis:

    As required by the Regulatory Flexibility Act, the Report and Order 
contains a Final Regulatory Flexibility Analysis which is set forth in 
Appendix C to the Report and Order. A brief description of the analysis 
follows.
    The rules adopted in this Report and Order are necessary to 
implement the provisions of the Telecommunications Act of 1996 
requiring LECs to offer number portability, if technically feasible.
    Although there were no comments submitted in response to the 
Initial Regulatory Flexibility Analysis set forth in the Notice of 
Proposed Rulemaking, the general comments of Chief Counsel for Advocacy 
of the United States Small Business Administration (SBA) generally 
supported the actions of the Commission in the Report and Order. 
However, in their general comments filed prior to the passage of the 
1996 Act, some LECs suggested that the Commission should neither adopt, 
nor direct the adoption of, number portability without performing a 
thorough cost/benefit analysis--a course of action which may result in 
less of an impact on small entities. However, after passage of the 1996 
Act, most parties agreed that the 1996 Act clearly directs the 
Commission to implement long-term number portability.
    The statutory meaning of the term ``small business'' is one which 
(1) is independently owned and operated; (2) is not dominant in its 
field of operation; and (3) satisfies any additional criteria 
established by the Small Business Administration (SBA). According to 
SBA's regulations, entities engaged in the provision of telephone 
service may have a maximum of 1,500 employees in order to qualify as a 
small business concern. 13 CFR 121.201. This standard also applies in 
determining whether an entity is a small business for purposes of the 
Regulatory Flexibility Act.
    The rules adopted by the Commission governing long-term number 
portability apply to all LECs, including incumbent LECs as well as new 
LEC entrants, and also apply to cellular, broadband PCS, and covered 
SMR providers. According to the SBA definition, incumbent LECs do not 
qualify as small businesses because they are dominant in their field of 
operation. However, the rules may have a significant economic impact on 
a substantial number of small businesses insofar as they apply to 
telecommunications carriers other than incumbent LECs, such as new 
entrant LECs, as well as cellular, broadband PCS, and covered SMR 
providers. Based upon data contained in the most recent census and a 
report by the Commission's Common Carrier Bureau, the Commission 
estimated that 2,100 carriers could be affected. This estimate was 
derived based on an analysis using census data on the number of firms 
with fewer than 1,000 employees and subtracting the number of incumbent 
LECs (as established by an FCC report). For a detailed analysis, see 
Appendix C of the Report and Order.
    There are several reporting requirements imposed by the Report and 
Order which will likely require the services of persons with technical 
expertise to prepare the reports. First, carriers participating in a 
field test in the Chicago, Illinois, area are required to file with the 
Commission a report of their findings within 30 days after completion 
of the test. Second, after December 31, 1998, long-term number 
portability must be provided by LECs outside of the 100 largest MSAs 
within six months after a specific request by another 
telecommunications carrier in which the requesting carrier is operating 
or plans to operate. The specific request must contain certain 
information. Third, state regulatory commissions must file with the 
Commission a notification if they opt to develop a state-specific 
database in lieu of participating in a regional database system. 
Carriers that object to a state decision to opt out of the regional 
database system may file with the Commission a petition for relief. 
Fourth, the item requires any administrator selected by a state prior 
to the release of the Report and Order, that wishes to bid for 
administration of one of the regional databases, must submit a new 
proposal in accordance with the guidelines established by the NANC. 
Fifth, the Report and Order requires carriers that are unable to meet 
the deadlines for implementing a long-term number portability solution 
to file with the Commission at least 60 days in advance of the deadline 
a petition to extend the time by which implementation in its network 
will be completed. Finally, we require an industry body known as the 
Industry Numbering Committee (INC) to file a report with the Commission 
on the portability of non-geographic numbers assigned to LECs within 12 
months after the effective date of the Report and Order.
    The Commission's actions in this Report and Order will benefit 
small entities by facilitating their entry into the local exchange 
market. The record in this proceeding indicates that the lack of number 
portability would deter entry by competitive providers of local service 
because of the value customers place on retaining their telephone 
numbers. These competitive providers, many of which may be small 
entities, may find it easier to enter the market as a result of number 
portability which will eliminate this barrier to entry.
    In general, the Commission has attempted to keep burdens on local 
exchange carriers to a minimum. For example, the phased deployment 
schedule requires long-term number portability to be implemented 
initially in the 100 largest MSAs, and then elsewhere upon a carrier's 
request. The provision of currently available measures is conditioned 
upon request only. In addition, the Commission has attempted to 
minimize the impact of our rules upon cellular, broadband PCS, and 
covered SMR providers, which may be small businesses, by not requiring 
such carriers to offer currently available number portability measures. 
Similarly, paging and messaging service providers, which may be small 
entities, are required to provide neither currently available measures 
nor long-term number portability under our rules. The regulatory 
burdens imposed are necessary to ensure that the public receives the 
benefit of the expeditious provision of service provider number 
portability in accordance with the statutory requirements.

Paperwork Reduction Act

    Public reporting burden for the collections of information is 
estimated as follows:

----------------------------------------------------------------------------------------------------------------
                                                                                                     Estimated  
                                                                                                     number of  
                                                                                                    respondents 
           Information collections                     Estimated avg. hours per response           (all are one-
                                                                                                     time only  
                                                                                                    responses)  
----------------------------------------------------------------------------------------------------------------
Field test report...........................  20 hours per respondent (joint response)..........              11

[[Page 38607]]

                                                                                                                
Requests for long-term number portability in  3 hours...........................................              80
 areas outside the 100 largest MSAs.                                                                            
State notification of intention to ``opt      3 hours...........................................               5
 out'' of regional database system.                                                                             
Carrier petitions challenging state decision  10 hours..........................................               2
 to ``opt out'' of regional database system.                                                                    
Proposal to administer database(s)..........  160 hours.........................................               1
Petitions to extend implementation deadline.  10 hours..........................................               8
----------------------------------------------------------------------------------------------------------------


    Total Annual Burden: 735 hours.
    Frequency of Response: All collections of information require one-
time only responses.
    These estimates include the time for reviewing instructions, 
searching existing data sources, gathering and maintaining the data 
needed, and completing and reviewing the collections of information. 
Send comments regarding these burden estimates or any other aspects of 
the collections of information, including suggestions for reducing the 
burden, to the Federal Communications Commission, Records Management 
Branch, Room 234, Paperwork Reduction Project, Washington, DC 20554 and 
to the Office of Management and Budget, Paperwork Reduction Project, 
Washington, DC 20503.

Synopsis of First Report and Order

I. Introduction

    1. We initiated this proceeding on July 13, 1995, when we adopted a 
Notice of Proposed Rulemaking seeking comment on a wide variety of 
policy and technical issues related to telephone number portability (60 
FR 39136 (August 1, 1995)). Since our adoption of the NPRM, the 
Telecommunications Act of 1996 became law. Section 251, added by the 
1996 Act, requires all local exchange carriers (LECs), both incumbents 
and new entrants, to offer number portability in accordance with 
requirements prescribed by the Commission. On March 14, 1996, the 
Common Carrier Bureau released a Public Notice seeking comment on how 
the passage of the 1996 Act may have affected the issues raised in the 
NPRM (61 FR 11174 (March 19, 1996)). Comments in response to the Public 
Notice were received on March 29, 1996, and reply comments were filed 
on April 5, 1996. In addition, efforts to implement number portability 
at the state level have progressed since adoption of the NPRM.
    2. The Telecommunications Act of 1996 establishes ``a pro-
competitive, de-regulatory national policy framework'' that is intended 
to ``promote competition and reduce regulation * * * to secure lower 
prices and higher quality services for American telecommunications 
consumers and encourage the rapid deployment of new telecommunications 
technologies.'' The statute imposes obligations and responsibilities on 
telecommunications carriers, particularly incumbent local exchange 
carriers, that are designed to open monopoly telecommunications markets 
to competitive entry and to promote competition in markets that already 
are open to new competitors. In particular, section 251(b) imposes 
specific obligations on all local exchange carriers to open their 
networks to competitors. The Act envisions that removing legal and 
regulatory barriers to entry and reducing economic impediments to entry 
will enable competitors to enter markets freely, encourage 
technological development, and ensure that a firm's prowess in 
satisfying consumer demand will determine its success or failure in the 
marketplace. In implementing the statute, the Commission has the 
responsibility to adopt the rules that will implement most quickly and 
effectively the national telecommunications policy embodied in the 1996 
Act. Number portability is one of the obligations that Congress imposed 
on all local exchange carriers, both incumbents and new entrants, in 
order to promote the pro-competitive, deregulatory markets it 
envisioned. Congress has recognized that number portability will lower 
barriers to entry and promote competition in the local exchange 
marketplace. In its report, the Senate Committee on Commerce, Science, 
and Transportation concluded that the ``minimum requirements [for 
interconnection set forth in new section 251(b), including number 
portability,] are necessary for opening the local exchange market to 
competition.'' Likewise, the House of Representatives Committee on 
Commerce determined that ``the ability to change service providers is 
only meaningful if a customer can retain his or her local telephone 
number.''
    3. In this Order, we promulgate rules and regulations implementing 
this congressional directive. Although we decline to choose a 
particular technology for providing number portability, we establish in 
this Report and Order performance criteria that any long-term number 
portability method selected by a LEC must meet. Pursuant to the 
statutory requirement in section 251 to provide number portability, we 
require all LECs to begin to implement a long-term service provider 
portability solution that meets our performance criteria in the 100 
largest Metropolitan Statistical Areas (MSAs) no later than October 1, 
1997, and to complete deployment in those MSAs by December 31, 1998, in 
accordance with a phased schedule set forth below. Number portability 
must be provided in these areas by all LECs to all telecommunications 
carriers, including commercial mobile radio services (CMRS) providers.
    4. The statute explicitly excludes CMRS providers from the 
definition of local exchange carriers, and therefore from the section 
251(b) obligations to provide number portability, unless the Commission 
concludes that they should be included in the definition of local 
exchange carrier. Our recent Notice of Proposed Rulemaking on 
interconnection issues raised by the 1996 Act sought comment generally 
on whether, and to what extent, CMRS providers should be classified as 
LECs. Because we conclude that we have independent authority under 
sections 1, 2, 4(i), and 332 of the Communications Act of 1934, as 
amended, to require cellular providers, broadband personal 
communications services (PCS), and covered Specialized Mobile Radio 
(SMR) providers to provide long-term service provider portability, we 
need not decide here whether CMRS providers must provide number 
portability as local exchange carriers under section 251(b). We require 
all cellular, broadband PCS, and covered SMR providers to have the 
capability of delivering calls from their networks to

[[Page 38608]]

ported numbers anywhere in the country by December 31, 1998, and to 
offer service provider portability, including the ability to support 
roaming, throughout their networks by June 30, 1999.
    5. We conclude that a system of regional databases that are managed 
by an independent administrator will serve the public interest. We 
direct the North American Numbering Council (NANC) to provide initial 
oversight of this regional database system. We direct the NANC to 
determine the number and location of the regional databases and to 
select one or more administrators responsible for deploying the 
database system. Any state that prefers to develop its own statewide 
database rather than participate in a regionally-deployed database, 
however, may opt out of its designated regional database and implement 
a state-specific database. We will retain authority to override a 
state's decision to develop a statewide database if an affected carrier 
can demonstrate that the state's proposal would significantly delay 
deployment of a long-term method or impose unreasonable costs on 
affected carriers.
    6. Until long-term service provider portability is available, we 
require LECs to provide currently available number portability 
measures, such as Remote Call Forwarding (RCF) and Direct Inward 
Dialing (DID), upon specific request from another carrier. We conclude, 
however, that commercial mobile radio service providers need not 
provide such measures due to technical considerations specific to the 
CMRS industry. We enunciate principles that ensure that the costs of 
currently available measures are borne by all telecommunications 
carriers on a competitively neutral basis, and we conclude that states 
may utilize various cost recovery mechanisms, so long as they are 
consistent with these statutory requirements. We decline at this time 
to require the provision of either service or location portability. We 
conclude that, while the statute requires LECs to implement 500 and 900 
number portability, there is insufficient record evidence to determine 
whether LEC provision of portability for 500 and 900 numbers is 
technically feasible. As a result, we refer the issue to the Industry 
Numbering Committee (INC), which must report its findings to the 
Commission within 12 months of the effective date of this Order. 
Finally, we adopt a Further Notice of Proposed Rulemaking regarding 
cost recovery for long-term number portability.

II. Background

A. Telecommunications Act of 1996

    7. New section 251(b)(2) of the Communications Act of 1934, as 
added by the 1996 Act, directs each local exchange carrier ``to 
provide, to the extent technically feasible, number portability in 
accordance with requirements prescribed by the Commission.'' The 1996 
Act defines the term ``local exchange carrier'' as:

any person that is engaged in the provision of telephone exchange 
service or exchange access. Such term does not include a [commercial 
mobile service provider,] as defined under section 332(c), except to 
the extent that the Commission finds that such provider should be 
included in the definition of such term.

    The 1996 Act defines ``number portability'' as ``the ability of 
users of telecommunications services to retain, at the same location, 
existing telecommunications numbers without impairment of quality, 
reliability, or convenience when switching from one telecommunications 
carrier to another.''
    8. The 1996 Act defines the term ``telecommunications carrier'' as 
``any provider of telecommunications services, except that such term 
does not include aggregators of telecommunications services (as defined 
in section 226).'' The term ``telecommunications service'' is defined 
by the 1996 Act as ``the offering of telecommunications for a fee 
directly to the public, or to such classes of users as to be 
effectively available directly to the public, regardless of the 
facilities used.'' Because the 1996 Act's definition of number 
portability requires LECs to provide number portability when customers 
switch from any telecommunications carrier to any other, the statutory 
obligation of LECs to provide number portability runs to other 
telecommunications carriers. Because CMRS falls within the statutory 
definition of telecommunications service, CMRS carriers are 
telecommunications carriers under the 1996 Act. As a result, LECs are 
obligated under the statute to provide number portability to customers 
seeking to switch to CMRS carriers.
    9. In addition to the duties imposed by section 251(b) on all LECs, 
section 251(c)(1) imposes upon incumbent LECs, inter alia, the ``duty 
to negotiate in good faith * * * the terms and conditions of agreements 
to fulfill'' the section 251(b) obligations, including the duty to 
provide number portability. An incumbent LEC is defined as a carrier 
that was providing exchange access service in a particular area on 
February 8, 1996, and was a member of the National Exchange Carrier 
Association (NECA) pursuant to Sec. 69.601(b) of the Commission's 
regulations. The 1996 Act creates an exemption from the obligations of 
section 251(c) for rural telephone companies, and allows LECs with 
fewer than two percent of the nation's subscriber lines to petition a 
state commission for suspension or modification of the application of 
sections 251(b) and (c).
    10. Section 251(e)(1) reinforces the Commission's authority over 
matters relating to the administration of numbering resources by giving 
the Commission exclusive jurisdiction over those portions of the North 
American Numbering Plan (NANP) that pertain to the United States. This 
subsection also requires the Commission to ``create or designate one or 
more impartial entities to administer telecommunications numbering and 
to make such numbers available on an equitable basis.'' Moreover, 
section 251(e)(2) provides that the cost of ``number portability shall 
be borne by all telecommunications carriers on a competitively neutral 
basis as determined by the Commission.''
    11. Finally, new section 271(c)(2)(B) establishes a ``competitive 
checklist'' of requirements that the Bell Operating Companies (BOCs) 
must meet to provide in-region interLATA services. One of the 
requirements that the BOCs must satisfy is the provision of ``interim 
number portability through remote call forwarding, direct inward 
dialing trunks, or other comparable arrangements, with as little 
impairment of functioning, quality, reliability, and convenience as 
possible'' until the Commission issues regulations pursuant to section 
251 to implement the statute's number portability requirements. Section 
271(c)(2)(B)(xi) directs the BOCs to comply fully with the regulations 
implemented by the Commission.

B. Proposed Number Portability Methods

    12. Because most telephone numbers within the NANP are associated 
with a particular switch operated by a particular service provider, 
they currently cannot be transferred outside the service area of a 
particular switch or between switches operated by different service 
providers without technical changes to the switch or network. Several 
methods exist, or are being developed, to provide telephone number 
portability. These methods generally consist of two types: database and 
non-database methods.

[[Page 38609]]

1. Database Methods
    13. Several industry participants have proposed methods for 
providing service provider portability that use databases containing 
the customer routing information necessary to route telephone calls to 
the proper terminating locations. All these methods depend on 
Intelligent Network (IN) or Advanced Intelligent Network (AIN) 
capabilities. Before the release of our NPRM, AT&T proposed a Location 
Routing Number (LRN) method to the Industry Numbering Committee (INC), 
an industry body that provides an open forum to address and resolve 
industry-wide issues associated with the non-policy-related planning, 
administration, allocation, assignment, and use of numbering resources 
within the NANP area. Since it proposed LRN to the INC, AT&T has 
continued to develop and refine this method. Essentially, LRN assigns a 
unique 10-digit telephone number to each switch in a defined geographic 
area. The location routing number serves as a network address. Carriers 
routing telephone calls to customers that have transferred their 
telephone numbers from one carrier to another perform a database query 
to obtain the location routing number that corresponds to the dialed 
telephone number. The database query is performed for all calls to 
switches from which at least one number has been ported. The carrier 
then would route the call to the new carrier based on the location 
routing number.
    14. MCI, DSC Communications, Nortel, Tandem Computers, and Siemens 
Stromberg-Carlson have developed a method referred to as the Carrier 
Portability Code (CPC) method. This method operates in a similar manner 
to LRN. Under CPC, however, the database associates the dialed 
telephone number with a 3-digit carrier portability code identifying 
the particular carrier to whom the dialed number has been transferred, 
rather than a particular switch. As described below, many of the 
parties in this proceeding and staff of some state commissions consider 
the CPC method to be an interim database solution.
    15. Stratus Computer and US Intelco have developed another database 
method commonly referred to as Local Area Number Portability (LANP). 
This method uses two ``domains'' of 10-digit numbers to route telephone 
calls to customers that have transferred their numbers to new carriers 
or new geographic locations. Specifically, LANP assigns a ten-digit 
customer number address (CNA) to each end user; this is the number that 
callers would dial to place telephone calls to the particular end user. 
It also assigns each customer a 10-digit network node address (NNA) 
that identifies where in the telephone network to reach the particular 
end user. Both the CNA and the NNA are stored in routing databases so 
that carriers can determine from the dialed telephone number where in 
the network to reach the called party.
    16. GTE has proposed both on the record in this proceeding and 
before the INC what it refers to as the Non-Geographic Number (NGN) 
method. While this method uses a database, it operates in a 
fundamentally different manner from CPC, LRN, and LANP. The NGN method 
would provide service provider and location portability to end users by 
assigning them non-geographic telephone numbers, such as an INPA 
(interchangeable numbering plan area) code that has been assigned for 
non-geographic numbers. Telephone calls to such end users would be 
routed in much the same way as toll free calls are today, by performing 
a database query to determine the geographic telephone number 
corresponding to the dialed non-geographic telephone number, and 
routing the call to the appropriate geographic number.
    17. Pacific Bell has proposed a triggering mechanism which operates 
in conjunction with the same addressing scheme utilized in AT&T's LRN 
method. This mechanism, called Query on Release (QOR) or Look Ahead, 
determines under what circumstances a database query is performed. 
Under QOR, the signalling used to set up a telephone call is routed to 
the end office switch to which the dialed telephone number was 
originally assigned (the release switch), i.e., according to the NPA-
NXX of the dialed number. If the dialed number has been transferred to 
another carrier's switch, the previous switch in the call path queries 
the database to obtain the routing information. The call is then 
completed to the new carrier's switch.
    18. Another number portability method triggering mechanism that is 
similar to QOR is Release-to-Pivot (RTP). RTP differs from QOR in that 
when a number has been ported from the release switch, the release 
switch--rather than the previous switch in the call path--returns the 
address information necessary for routing the call. The information 
regarding where to route the telephone call, if the number has been 
transferred, may be contained either in the release switch or an 
external database.
2. Non-Database Methods
    19. In our NPRM, we discussed two currently available methods of 
providing service provider portability that do not use databases: 
Remote Call Forwarding and Flexible Direct Inward Dialing. These 
methods are commonly referred to as ``interim measures.'' While most 
LECs currently are able to port numbers to other service providers 
using these methods, they suffer from certain limitations that make 
them unsuitable for long-term number portability. RCF redirects calls 
to telephone numbers that have been transferred by essentially placing 
a second telephone call to the new network location. DID routes the 
second call over a dedicated facility to the new service provider's 
switch, instead of translating the dialed number to a new number.
    20. In the NPRM, we also discussed three derivative methods of RCF 
and DID (enhanced remote call forwarding, route index/portability hub, 
and hub routing with AIN), all of which require routing incoming calls 
to the terminating switch identified by the NPA-NXX code of the dialed 
phone number. Unlike RCF and DID, they use LEC tandem switches to 
aggregate calls to a particular competing service provider before those 
calls are routed to that provider. In addition, LECs in several states 
reportedly are providing Directory Number Route Indexing (DNRI), which 
first routes incoming calls to the switch to which the NPA-NXX code was 
originally assigned, then routes ported calls to the new service 
provider either through a direct trunk or by attaching a pseudo NPA to 
the number and using a tandem, depending on availability.

C. Current State Efforts

1. State Task Forces and Implementation
    21. Parties to this proceeding report that several states have 
established task forces of industry participants or are otherwise 
beginning to investigate the development and implementation of long-
term number portability methods. Those states include: Alabama, 
Arizona, California, Colorado, Connecticut, Florida, Georgia, Illinois, 
Indiana, Kansas, Maryland, Michigan, Minnesota, New York, Ohio, Oregon, 
Texas, Utah, Virginia, Washington, Wisconsin, and Wyoming. Of these 
states, the task forces in Colorado, Florida, Georgia, Illinois, 
Maryland, and New York have all selected AT&T's Location Routing Number 
method for implementing service provider number portability in areas 
within their states'

[[Page 38610]]

boundaries. In addition, the state commissions of Colorado, Georgia, 
Illinois, Maryland, New York, and Ohio have adopted the recommendation 
of their staff and task forces to implement LRN. Parties to this 
proceeding assert, moreover, that state task forces or commissions in 
other states, such as Indiana, Michigan, and Wisconsin, as well as in 
Canada, are utilizing the results of the Illinois task force's efforts 
in the area of number portability.
    22. Several states have set implementation schedules for the 
portability methods they have selected. Switch vendors have committed 
to make available LRN software to carriers in Illinois in the second 
quarter of 1997. Colorado, Illinois, and Georgia plan to begin 
deploying LRN in mid-1997. New York also expects LRN to be generally 
available for installation in that state in mid-1997, though deployment 
in certain AT&T switches is expected to begin earlier. Maryland plans 
to begin implementing LRN by no later than the third quarter of 1997. 
According to NARUC, Colorado similarly expects LRN availability in the 
second quarter of 1997 (but plans to monitor switch vendor progress and 
reevaluate this time frame in the third quarter of 1996). Ohio will use 
a LRN number portability workshop, to be established within 120 days of 
the issuance of its June 12, 1996 Order, to establish the time frame 
and manner of the implementation of LRN in Ohio. Michigan has ordered 
that implementation of long-term number portability in Michigan start 
at the same time that implementation begins in Illinois. The Illinois 
and Maryland task forces are examining various implementation issues, 
including a deployment schedule, cost recovery, billing and rating, and 
service management system (SMS) administration. The Illinois task force 
selected an SMS provider in April 1996. The Maryland and Colorado task 
forces have been planning to release their requests for proposals for 
their SMS administrators in the second quarter of 1996.
2. State Trials
    23. Two states have conducted or are conducting number portability 
trials. As we described in the NPRM, ten companies, working with the 
New York Department of Public Service (NY DPS), jointly initiated two 
number portability trials, one in Rochester and another in Manhattan. 
The companies originally planned to test the LANP method of Stratus 
Computers and US Intelco in Rochester, but that trial was canceled. The 
Manhattan trial, testing the CPC method, began in early February of 
this year. The New York DPS, however, now considers CPC to be, at best, 
an interim method and has changed the trial's emphasis from the 
technical aspects of the method to the operational and administrative 
aspects of the intercompany procedures that are required to change a 
customer from one local exchange provider to another. MCI, one of the 
original proponents of CPC, no longer views CPC as a viable long-term 
method.
    24. A group of telecommunications service providers conducted a 
technical trial of the LANP method in Seattle, Washington, during 1995. 
That trial ended in December 1995. The objective of the technical trial 
was to identify the technical, operational, and administrative issues 
that arise when a telephone number is not associated with a specific 
geographic location. Because the trial revealed certain technical and 
operational difficulties with the LANP technology, the Washington task 
force on number portability declined to adopt LANP. The Washington 
Utilities and Transportation Commission has not adopted LANP, and the 
companies involved in the trial have ceased advocating LANP.
3. State Interim Measures
    25. Carriers are providing interim portability measures in a number 
of states, either voluntarily or pursuant to state commission orders. 
According to NARUC and other parties to the proceeding, LECs are 
providing RCF, DID, and/or other comparable arrangements in Arizona, 
California, Colorado, Connecticut, Florida, Georgia, Illinois, Indiana, 
Iowa, Louisiana, Maryland, Massachusetts, Michigan, New York, Ohio, 
Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia, Washington, 
Wisconsin, and Wyoming. According to USTA, Alabama and Minnesota are 
considering interim portability requirements, while North Carolina 
requires carriers to negotiate interim portability as part of their 
interconnection agreements.

III. Report and Order

A. Importance of Service Provider Number Portability

1. Background

26. In the NPRM, we tentatively concluded that number portability 
benefits consumers of telecommunications services and would contribute 
to the development of competition among alternative providers of local 
telephone and other telecommunications services. With respect to 
service provider portability, we sought comment on the effects that 
local number portability, or lack thereof, would have on the local 
exchange marketplace. Specifically, we sought comment on the value 
consumers place on their telephone numbers, the deterrent effect that a 
lack of number portability would have on consumer decisions to change 
service providers, and any resultant effect on competition between 
incumbent local service providers and new competitors in local markets.
2. Discussion
    27. Since we adopted the NPRM, Congress passed the 1996 Act, which 
requires all LECs to ``provide, to the extent technically feasible, 
number portability in accordance with requirements prescribed by the 
Commission.'' The 1996 Act defines number portability as ``the ability 
of users of telecommunications services to retain, at the same 
location, existing telecommunications numbers without impairment of 
quality, reliability, or convenience when switching from one 
telecommunications carrier to another.'' Accordingly, we hereby modify 
our proposed definition of number portability to conform to the 
statutory definition of number portability and note that the statutory 
definition of this term is synonymous with the NPRM's definition of 
``service provider portability.''
    28. Although some incumbent LECs assert that local exchange market 
competition will develop without number portability, the record 
developed in this proceeding confirms the congressional findings that 
number portability is essential to meaningful competition in the 
provision of local exchange services. Several state commissions have 
also recognized the significant role that number portability will play 
in the development of local exchange competition. We, therefore, affirm 
our tentative conclusion that number portability provides consumers 
flexibility in the way they use their telecommunications services and

[[Page 38611]]

promotes the development of competition among alternative providers of 
telephone and other telecommunications services.
    29. We note that several studies described in the record 
demonstrate the reluctance of both business and residential customers 
to switch carriers if they must change numbers. For example, MCI has 
stated that, based on a nationwide Gallup survey, 83 percent of 
business customers and 80 percent of residential customers would be 
unlikely to change local service providers if they had to change their 
telephone numbers. Time Warner Holdings states that consumers are 40 
percent less likely to change service providers if a number change is 
required. Citizens Utilities notes that approximately 85 percent of the 
discussions that its subsidiary, ELI, has with potential customers 
about switching providers end when those potential customers learn that 
they must change their telephone numbers. The study commissioned by 
Pacific Bell concludes that, without portability, new entrants would be 
forced to discount their local exchange service and other competing 
offerings by at least 12 percent below the incumbent LECs' prices in 
order to induce customers to switch carriers due to customers' 
resistance to changing numbers.
    30. The ability of end users to retain their telephone numbers when 
changing service providers gives customers flexibility in the quality, 
price, and variety of telecommunications services they can choose to 
purchase. Number portability promotes competition between 
telecommunications service providers by, among other things, allowing 
customers to respond to price and service changes without changing 
their telephone numbers. The resulting competition will benefit all 
users of telecommunications services. Indeed, competition should foster 
lower local telephone prices and, consequently, stimulate demand for 
telecommunications services and increase economic growth.
    31. Conversely, the record demonstrates that a lack of number 
portability likely would deter entry by competitive providers of local 
service because of the value customers place on retaining their 
telephone numbers. Business customers, in particular, may be reluctant 
to incur the administrative, marketing, and goodwill costs associated 
with changing telephone numbers. As indicated above, several studies 
show that customers are reluctant to switch carriers if they are 
required to change telephone numbers. To the extent that customers are 
reluctant to change service providers due to the absence of number 
portability, demand for services provided by new entrants will be 
depressed. This could well discourage entry by new service providers 
and thereby frustrate the pro-competitive goals of the 1996 Act.

B. The Commission's Role

1. Background
    32. In the NPRM, we tentatively concluded that the Commission has a 
significant interest in promoting the nationwide availability of number 
portability due to its impact on interstate telecommunications. We 
based this interest on four grounds: (1) Our obligation to promote an 
efficient and fair telecommunications system; (2) the inability to 
separate the impact of number portability between intrastate and 
interstate telecommunications; (3) the likely adverse impact deploying 
different number portability solutions across the country would have on 
the provision of interstate telecommunications services; and (4) the 
impact that number portability could have on the use of the numbering 
resource, that is, ensuring that the use of numbers is efficient and 
does not contribute to area code exhaust.
    33. In the 1996 Act, Congress expressly assigned to the Commission 
exclusive jurisdiction over that portion of the NANP that pertains to 
the United States. Moreover, Congress directed the Commission to 
prescribe regulations for LEC provision of number portability: Section 
251(b)(2) requires carriers ``to provide, to the extent technically 
feasible, number portability in accordance with the requirements 
prescribed by the Commission.''
2. Positions of the Parties
    34. Prior to passage of the 1996 Act, some LECs asserted that the 
Commission should neither adopt, nor direct the adoption of, number 
portability without performing a thorough cost/benefit analysis. Most 
parties, however, now agree that the 1996 Act clearly directs this 
Commission to implement long-term number portability. Moreover, some 
parties contend that this mandate reflects the fact that Congress has 
weighed the costs and benefits of implementing number portability. USTA 
adds, however, that the Commission may consider economic efficiencies 
in determining what rules to implement.
    34. Several commenters, while agreeing that the Commission should 
take a leadership role, urge us to leave certain implementation issues 
to the states. USTA advocates allowing the states to determine their 
own deployment schedules. The California PUC asserts that the 
Commission's jurisdiction over number portability is not exclusive, and 
that states must be allowed to implement number portability methods 
that are most compatible with local exchange competition in each state.
3. Discussion
    36. We believe that Congress has determined that this Commission 
should develop a national number portability policy and has 
specifically directed us to prescribe the requirements that all local 
exchange carriers, both incumbents and others, must meet to satisfy 
their statutory obligations. Section 251(b)(2) requires LECs ``to 
provide, to the extent technically feasible, number portability in 
accordance with the requirements prescribed by the Commission.'' 
Moreover, section 251(e)(1)'s assignment to the Commission of exclusive 
jurisdiction over that portion of the NANP that pertains to the United 
States gives us authority over the implementation of number portability 
to the extent that such implementation will affect the NANP. Consistent 
with the role assigned to the Commission by the 1996 Act, the record 
developed in this proceeding overwhelmingly indicates that the 
Commission should take a leadership role with respect to number 
portability. We, therefore, affirm our conclusion that we should take a 
leadership role in developing a national number portability policy. We 
further note that, in light of Congress's mandate to us to prescribe 
requirements for number portability, it is not necessary to engage in a 
cost/benefit analysis as to whether to adopt rules that require LECs to 
provide number portability in the first instance. We may consider 
economic and other factors, however, when determining the specific 
requirements in such rules.
    37. The 1996 Act directs this Commission to adopt regulations to 
implement number portability, and we believe it is important that we 
adopt uniform national rules regarding number portability 
implementation and deployment to ensure efficient and consistent use of 
number portability methods and numbering resources on a nationwide 
basis. Implementation of number portability, and its effect on 
numbering resources, will have an impact on interstate, as well as 
local, telecommunications services. Ensuring the interoperability of 
networks is essential for deployment of a national number portability 
regime, and for the

[[Page 38612]]

prevention of adverse impacts on the provision of interstate 
telecommunications services or on the use of the numbering resource. We 
believe that allowing number portability to develop on a state-by-state 
basis could potentially thwart the intentions of Congress in mandating 
a national number portability policy, and could retard the development 
of competition in the provision of telecommunications services.

C. Performance Criteria for Long-Term Number Portability

1. Background
    38. In the NPRM, we sought comment on what long-term number 
portability methods would be in the public interest. Specifically, we 
sought comment on various number portability proposals offered by 
different industry participants, including proposals by AT&T, MCI 
Metro, Stratus Computer and US Intelco, and GTE. We also sought comment 
on the extent to which these proposals would support certain services 
that we deemed important. We tentatively concluded that any method 
should support operator services and emergency services because they 
are critical to public safety and are important features of the public 
switched network. We also tentatively concluded that any number 
portability proposal should efficiently use telephone numbers. In 
addition, we discussed and sought comment on which of three call 
processing scenarios (i.e., which carrier performs the database query 
in a database method), or any alternative, would best serve the public 
interest. We sought comment on whether telephone numbers should be 
portable within local calling areas, throughout a particular area code, 
state-wide, regionally, nationwide, or on some other basis, and how the 
geographic scope of portability would impact different types of 
carriers and their billing systems. We also asked whether number 
portability could be provided nationwide without significant network 
modifications.
2. Positions of the Parties
    39. Performance criteria versus selection of architecture. 
Commenting parties differ on whether the Commission should establish 
performance criteria or guidelines that any number portability method 
must meet, or require the implementation of one national portability 
method. Many parties, including several state regulatory agencies, 
cable interests, and LECs, favor establishment of broad guidelines and 
interoperability criteria for implementing a long-term portability 
method. NYNEX maintains that this approach would encourage cooperative 
industry resolutions for a true number portability method and would 
properly account for legitimate state interests in the deployment of 
number portability. NYNEX further claims that guidelines would allow 
the Commission to ensure the implementation of compatible methods, with 
seamless call flows and service operation, without expending scarce 
resources by focusing on the detailed implementation of every method in 
each region of the country. The California Department of Consumer 
Affairs contends that the 1996 Act's pro-competitive policies mandate 
that the portability method adopted be flexible and allow for future 
innovation. GTE urges the Commission to determine the type of routing 
information to be employed, but leave selection of the triggering 
mechanism to the individual carriers. SBC Communications asserts that 
section 251(d)(1) only requires the Commission to outline principles 
for a long-term method within six months of enactment of the 1996 Act, 
not to adopt a specific method.
    40. Conversely, some parties contend that requiring a single, 
national method would avoid the implementation of numerous inconsistent 
and inefficient approaches, and the need for carriers to adapt to 
different requirements in different states. Jones Intercable argues 
that allowing number portability to develop state-by-state would give 
the incumbent LECs the opportunity to delay development of local 
exchange competition. BellSouth and Nortel argue that a single long-
term method is necessary to minimize the costs of implementation, 
operation, and maintenance; to protect billing systems against problems 
created by use of differing SS7 parameters; and to foster network 
integrity. PCIA claims that a state-regulated market would inhibit 
development of a nationwide wireless network. Arch/AirTouch Paging adds 
that deployment of different portability methods would adversely impact 
interstate telecommunications. Bell Atlantic and PCIA argue that a 
national method is more likely to conserve scarce numbering resources. 
Bell Atlantic further claims, however, that each individual carrier 
should be allowed the flexibility to utilize whatever architecture or 
technology within its own network best enables that carrier to 
implement whatever national method is selected. Moreover, some parties 
urge the Commission to select a particular method to be implemented 
nationwide, while others advocate allowing the industry to select the 
specific method.
    41. Commenting parties suggest numerous performance criteria with 
which any long-term number portability method must comply. These 
include: (1) The ability to support emergency services, i.e., 911 and 
enhanced 911 (E911) services; (2) the ability to support existing 
network services and capabilities, (e.g., operator and directory 
services, vertical and advanced services, custom local area signaling 
services (also known as ``CLASS''), toll free and pay-per-call 
services, and intercept capabilities); (3) efficient use of numbering 
resources; (4) no initial change of telephone numbers; (5) no reliance 
on network facilities of, or services provided by, other service 
providers (e.g., incumbent LECs) in order to route calls; (6) no 
degradation in service quality or network reliability (e.g., no 
significant increase in call set-up time); (7) reliance on existing 
network infrastructure and functionalities to the extent possible; (8) 
equal application to both incumbents and new entrants (i.e., carriers 
who receive ported numbers must also provide portability); (9) no 
proprietary interests or licensing fees; (10) the ability to migrate to 
location and service portability; and (11) no adverse impact in areas 
where portability has not been deployed.
    42. Call processing scenarios. In the NPRM, we discussed three call 
processing scenarios. They were: (1) The terminating ``access'' 
provider (TAP) scenario, under which the database query is performed by 
the terminating access provider (usually the incumbent LEC, who 
recovers interstate access charges from interexchange carriers (IXCs) 
for terminating traffic under our existing access charge regime); (2) 
the originating service provider (OSP) scenario, under which the 
originating service provider performs the database query; and (3) the 
``N minus 1'' (N-1) scenario, under which the carrier immediately prior 
to the terminating service provider performs the database query or dip. 
In addition, ITN suggests a ``first-switch-that-can'' approach, under 
which the first switch that handles the call and has the capability to 
do the database dip performs the query.
    43. Pacific Bell and Bell Atlantic recommend that carriers should 
be permitted to choose a call processing scenario to enable them to 
implement the QOR triggering mechanism in addition to LRN. These 
parties assert that QOR would eliminate unnecessary database queries, 
thereby decreasing the number of databases necessary to

[[Page 38613]]

provide number portability and the transmission capacity between 
switches and databases. In contrast, AT&T argues against allowing 
carriers to choose a call processing scenario, such as QOR, because 
doing so would delay deployment of a long-term number portability 
method and would result in significant network interoperability issues. 
MCI opposes implementation of QOR because it forces competitive LECs to 
rely on the incumbent LEC's network and results in inefficient routing. 
AT&T and MCI also argue against use of the RTP or QOR triggering 
mechanisms because they treat transferred and non-transferred numbers 
differently, and significantly increase post-dial delay and the 
potential for call blocking.
    44. Most of the parties that favor the Commission's selection of a 
particular call processing scenario prefer the N-1 scenario because 
they believe it allows database queries to be made at the most 
efficient points in the process of routing telephone calls. In 
contrast, ITN states that use of the N-1 scenario may hinder the 
evolution from localized to national number portability environments. 
BellSouth contends that the Commission need not select a particular 
scenario because all four triggering mechanisms (OSP, TAP, N-1, and 
Look-Ahead) could exist simultaneously through engineering and business 
arrangements. Citizens Utilities and NCTA oppose the TAP scenario 
because it requires routing most calls to the incumbent LEC networks, 
thus denying terminating access charges to competitive providers.
    45. Rating and billing. Several LECs, MCI, and MFS contend that any 
long-term method should preserve existing rating and billing systems to 
minimize costs and impact. Conversely, AT&T and Florida PSC argue that 
any long-term method should permit flexible rating and billing schemes. 
Pacific Bell, US West, and BellSouth also argue that the Commission 
must in this proceeding address billing problems, including issues 
relating to proper mileage, rating, calling cards, and billing format.
3. Discussion
    46. Performance criteria versus selection of architecture. We 
conclude that establishing performance criteria that a LEC's number 
portability architecture must meet would better serve the public 
interest than choosing a particular technology or specific 
architecture. First, we believe that to date there appears to be 
sufficient momentum to deploy compatible methods, if not an identical 
method, nationwide. Every state that has selected a particular 
architecture for implementation within its state boundaries has 
selected the same method, LRN, and numerous states are reportedly 
following suit. With the exception of some of the incumbent LECs, most 
parties that advocate selection of a particular method at this time are 
also supporting the LRN method. Under these circumstances, mandating 
the implementation of a particular number portability architecture, or 
mandating that the same architecture be deployed nationwide, appears 
unnecessary. Second, such a mandate might actually delay the 
implementation of number portability. We are reluctant, based on the 
record in this proceeding, to select one of the proposed long-term 
methods. According to a number of parties, none of the currently 
supported methods, including LRN, has been tested or described in 
sufficient detail to permit the Commission to select the particular 
architecture without further consultation with the industry. If, 
however, we were to direct an industry body to recommend a specific 
number portability architecture, it would likely delay the 
implementation of number portability that already is underway in 
several states, and would create significant uncertainty for those 
switch vendors currently modifying switch software to accommodate LRN. 
Third, dictating implementation of a particular method could foreclose 
the ability of carriers to improve on those methods already being 
deployed or to implement hybrid (but compatible) methods.
    47. We believe that our establishment of criteria for long-term 
number portability methods, however, will ensure an appropriate level 
of national uniformity, while maintaining flexibility to accommodate 
innovation and improvement. The deployment of a uniform number 
portability architecture nationwide will be important to the efficient 
functioning of the public switched telephone network and will reduce 
the costs of implementing number portability nationwide by allowing 
switch vendors to spread the costs of development over more customers. 
Moreover, a uniform deployment will allow switch manufacturers to work 
toward a single standard, thus avoiding the situation where different 
manufacturers partition the market among different methods.
    48. Performance Criteria. We thus adopt the following minimum 
criteria. Any long-term number portability method, including call 
processing scenarios or triggering, must:
    (1) Support existing network services, features, and capabilities;
    (2) Efficiently use numbering resources;
    (3) Not require end users to change their telecommunications 
numbers;
    (4) Not require telecommunications carriers to rely on databases, 
other network facilities, or services provided by other 
telecommunications carriers in order to route calls to the proper 
termination point;
    (5) Not result in unreasonable degradation in service quality or 
network reliability when implemented;
    (6) Not result in any degradation of service quality or network 
reliability when customers switch carriers;
    (7) Not result in a carrier having a proprietary interest;
    (8) Be able to accommodate location and service portability in the 
future; and
    (9) Have no significant adverse impact outside the areas where 
number portability is deployed.
    We discuss each of these performance criteria in turn below.
    49. First, we require that any long-term method support existing 
network services, features, or capabilities, such as emergency 
services, CLASS features, operator and directory assistance services, 
and intercept capabilities. The 1996 Act requires that consumers be 
able to retain their numbers ``without impairment of quality, 
reliability, or convenience when switching from one telecommunications 
carrier to another.'' Moreover, customers are not likely to switch 
carriers and retain their telephone numbers if they are required to 
forego services and features to which they have become accustomed. 
Thus, any long-term method that precludes the provision of existing 
services and features would place competing service providers at a 
competitive disadvantage.
    50. The public interest also requires that service provider 
portability not impair the provision of network capabilities that are 
important to public safety, such as emergency services and intercept 
capabilities. In our proposal to ensure that PBXs and CMRS providers 
support enhanced 911 services, we reaffirmed that 911 services enable 
telephone users to receive fast response to emergency situations, and 
that broad availability of 911 and E911 services best promotes ``safety 
of life and property through the use of wire and radio communication.'' 
In addition, the Communications Assistance for Law Enforcement Act 
requires telecommunications carriers generally to provide capabilities 
that enable secure, reliable, and non-intrusive law enforcement 
interception of call setup information and call content so that law 
enforcement agencies can intercept and monitor calls when necessary.

[[Page 38614]]

    51. Second, we require that any long-term method efficiently use 
numbering resources. Telephone numbers are the means by which 
commercial and residential consumers gain access to, and reap the 
benefits of, the public switched telephone network. In recent years, 
the explosive growth of wireless services has caused an equally 
dramatic increase in the consumption of telephone numbers. Indeed, in 
January 1995, carriers began to deploy interchangeable NPA (INPA) codes 
because all NPA codes had been exhausted. The anticipated shortage of 
numbers has prompted several BOCs to propose the use of area code 
overlays. The increased use of overlays and area code splits has 
resulted in both industry and consumer inconvenience and confusion. The 
consumption rate of NANP resources is likely to accelerate with the 
entry of new wireline and wireless carriers. Thus, we conclude that 
deploying a long-term number portability method that rapidly depletes 
numbering resources would undermine the efforts of the industry, the 
states, and the Commission to ensure sufficient numbering resources.
    52. Third, deployment of a long-term method should not require 
customers to make any telecommunications number change. The 1996 Act 
mandates that end users be able ``to retain * * * existing 
telecommunications numbers * * * when switching from one 
telecommunications carrier to another.'' Requiring any number change 
would contravene this basic requirement. Congress noted that the 
ability to switch service providers is only meaningful if customers can 
retain their telephone numbers.
    53. Fourth, we require that any long-term method ensure that 
carriers have the ability to route telephone calls and provide services 
to their customers independently from the networks of other carriers. 
Requiring carriers to rely on the networks of their competitors in 
order to route calls can have several undesirable effects. For example, 
dependence on the original service provider's network to provide 
services to a customer that has switched carriers contravenes the 
choice made by that customer to change service providers. In addition, 
such dependence creates the potential for call blocking by the original 
service provider and may make available to the original service 
provider proprietary customer information. Moreover, methods which 
first route the call through the original service provider's network in 
order to determine whether the call is to a ported number, and then 
perform a query only if the call is to be ported, would treat ported 
numbers differently than non-ported numbers, resulting in ported calls 
taking longer to complete than unported calls. This differential in 
efficiency would disadvantage the carrier to whom the call was ported 
and impair that carrier's ability to compete effectively against the 
original service provider. Finally, dependence on another carrier's 
network also reduces the new service provider's ability to control the 
routing of telephone calls to its customers, thus inhibiting its 
ability to control the costs of such routing. For these reasons, a 
long-term number portability method should not require dependency on 
another carrier's network. We note that this criterion does not prevent 
individual carriers from determining among themselves how to process 
calls, including a method by which a carrier voluntarily agrees to use 
the original service provider's network.
    54. We recognize that this criterion will effectively preclude 
carriers from implementing QOR. Those carriers that oppose QOR argue 
that it would treat ported and non-ported numbers differently, force 
reliance on the incumbent LEC's network, increase post-dial delay and 
the potential for call blocking, result in inefficient routing, create 
significant network interoperability issues, and delay deployment of a 
long-term number portability method. There is little evidence in the 
record to support the claim that allowing carriers to implement QOR 
would result in significant cost savings. Pacific Bell submitted 
summary figures indicating that it would save approximately $14.2 
million per year assuming that 20 percent of subscribers port their 
numbers if it implemented QOR. These savings, which represent less than 
0.2 percent of Pacific Bell's total annual operating revenues, appear 
insignificant in relation to the potential economic and non-economic 
costs to competitors if QOR is used. According to AT&T, using QOR on 
Lucent switches is more cost effective only if less than 12 percent of 
subscribers have ported their numbers. Similarly, AT&T asserts that 
using QOR on Siemens switches is more cost effective only if less than 
23 percent of subscribers have ported their numbers. In addition, 
because carriers using QOR may be required to send a QOR message to 
another carrier's switch to determine if a customer has transferred the 
number, the second carrier must have the ability to recognize and 
respond to the QOR message, which also may increase its costs. Based on 
the record before us, we conclude that the competitive benefits of 
ensuring that calls are not routed through the original carrier's 
network outweigh any cost savings that QOR may bring in the immediate 
future.
    55. Fifth, as a general matter, we require that the implementation 
of any long-term method not unreasonably degrade existing service 
quality or network reliability. Consumers, both business and 
residential, rely on the public switched telephone network for their 
livelihood, health and safety. Jeopardizing the reliability of the 
network would stifle business growth and economic development, and 
endanger individuals' personal safety and convenience. Consumers, both 
business and residential, have also come to expect a certain level of 
quality and convenience in using basic telecommunications services. We 
note that this Commission has repeatedly affirmed its commitment to 
maintaining service quality and network reliability. We, therefore, 
require that any long-term method of providing number portability not 
cause any unreasonable degradation to the network or the quality of 
existing services. This requirement extends to degradation that affects 
carriers operating, and end users obtaining services, outside as well 
as within the area of portability.
    56. Sixth, once long-term number portability is implemented, we 
require that customers not experience any degradation of service 
quality or network reliability when they port their numbers to other 
carriers. We reiterate that the 1996 Act requires that consumers be 
able to retain their numbers ``without impairment of quality, 
reliability, or convenience when switching from one telecommunications 
carrier to another.'' We interpret this mandate to mean, at a minimum, 
that when a customer switches carriers, that customer must not 
experience a greater dialing delay or call set up time, poorer 
transmission quality, or a loss of services (such as CLASS features) 
due to number portability compared to when the customer was with the 
original carrier.
    57. Seventh, we require that no carrier have a proprietary interest 
in any long term method. A telecommunications carrier may not own 
rights to, or have a proprietary interest in, number portability 
technology. We believe that the requirement in the 1996 Act that the 
costs of number portability be borne on a competitively neutral basis 
precludes carrier ownership of the long-term method, and their 
collection of licensing or other fees for use of the method. In 
addition, it would be competitively unfair if a LEC providing 
portability

[[Page 38615]]

were to benefit directly, through licensing fees or a proprietary 
interest, from its competitors' use of portability. We note that one of 
the first criteria required by the Illinois task force in selecting a 
number portability method was that it be non-proprietary.
    58. Eighth, we require that any long-term method be able to 
accommodate service and location portability in the future. Although we 
do not at this time mandate provision of service or location 
portability, we recognize that service and location portability have 
certain benefits, and we may take steps to implement them in the future 
if demand for these services develops. As our society becomes 
increasingly mobile, the importance that consumers attribute to the 
geographic identity of their telephone numbers may change. It is, 
therefore, in the public interest to take steps now to ensure that we 
do not foreclose realization of future economies of scope.
    59. Finally, we require that any long-term method not have a 
significant adverse impact on carriers operating, and end users 
obtaining services, outside the area of number portability. We believe 
it is fundamentally unfair to impose any new or different obligations 
on carriers and customers that do not benefit from service provider 
portability. Indeed, we are adopting a phased approach to 
implementation so that number portability is available only in the most 
populous local markets where competition already has begun to develop 
or is likely to develop in the near term.
    60. We do not believe it is necessary to require that a long-term 
method utilize existing network infrastructure and functionalities to 
the extent possible, as some commenting parties have suggested. 
Minimizing the costs of implementing a long-term method should be in 
the best interests of all the parties involved in such implementation. 
This conclusion is also consistent with our tentative conclusion that 
the carrier-specific costs that are not directly related to number 
portability must be borne by the individual carriers. Thus, existing 
local service providers have an incentive to minimize the extent of the 
necessary modifications and upgrades, as well as the costs of 
implementing number portability-specific software. Moreover, while new 
entrants may not need to modify existing networks, they must deploy and 
build networks with at least the same capabilities as those of the 
incumbents if they are to provide number portability.
    61. We also decline to require carriers that receive ported numbers 
also to provide portability because we believe the 1996 Act renders 
such a requirement unnecessary. Specifically, section 251(b)(2) imposes 
a duty to provide number portability on all LECs--incumbents as well as 
new entrants. In light of the fact that the 1996 Act applies this duty 
across all LECs, establishing a reciprocity performance criterion would 
be needlessly redundant.
    62. Call processing scenarios. We decline to specify the carrier 
that must perform the database query in a database method, because we 
recognize that individual carriers may wish to determine among 
themselves how to process calls under alternative scenarios. We 
therefore leave to local exchange carriers the flexibility to choose 
and negotiate the scenario that best suits their networks and business 
plans, as long as they act consistently with the requirements 
established by this Order. While our criterion requiring carriers to be 
able to route calls and provide service independently from other 
carriers' networks may preclude unilateral use of the TAP scenario by a 
particular carrier, there may be instances where carriers agree to use 
the TAP scenario, or where the terminating provider is the only carrier 
capable of performing the database query. In those instances, our 
performance criterion would not preclude use of the TAP scenario.
    63. Rating and billing. Finally, we decline to regulate the rating 
and billing of local wireline calls to end users in connection with a 
long-term number portability method. Traditionally, the billing and 
rating of local wireline calls--including the establishment of mileage 
standards, procedures for calling cards, and billing format--have been 
left to the purview of the states and the carriers themselves. While 
several parties have raised rating and billing questions with regard to 
number portability, we believe that such issues are more properly 
addressed by the states.

D. Mandate of Number Portability

1. Background
    64. In the NPRM, we sought comment on the estimated time to design, 
build, and deploy a long-term service provider number portability 
system. We also requested that parties address what network and other 
modifications would be necessary to effect the transition to 
portability. The 1996 Act mandates that all LECs ``provide, to the 
extent technically feasible, number portability in accordance with 
requirements prescribed by the Commission.''
2. Position of the Parties
    65. Mandate Implementation By A Date Certain. The competitive local 
exchange providers generally contend that the Commission should mandate 
the availability of number portability by a date certain. The incumbent 
LECs, however, caution the Commission not to act with undue haste by 
mandating the implementation of number portability by a date certain. 
Indeed, BellSouth claims that the 1996 Act's omission of a deadline for 
implementation indicates Congress's intent not to require a date 
certain at this time. It adds that the industry must first give careful 
attention to developing an implementation checklist that will ensure 
that the necessary tasks for the implementation are properly identified 
and performed. Instead of establishing a mandatory implementation date, 
some LECs contend that the Commission should direct an industry body, 
such as the INC, to determine the most appropriate schedule for 
deployment of a long-term solution. Other commenters argue that the 
implementation schedule should be determined by state regulatory 
bodies. Pacific Bell warns that a Commission-mandated solution at this 
time would be premature and cites a late proposal introduced by ITN as 
an illustration that the optimal solution may not yet have been 
introduced.
    66. The wireless industry offers various implementation plans. For 
instance, PageNet urges the Commission to establish federal guidelines 
for number portability, and at a specified time in the future, to 
evaluate the industry's standards using the guidelines through a notice 
and comment proceeding. However, Omnipoint believes the Commission 
should act more aggressively in mandating service provider portability 
by a date certain.
    67. Time Estimates for Deployment. Parties differ on their 
estimates for deployment. AT&T asserts that virtually all of the 
equipment vendors participating in the Illinois number portability task 
force indicate that they can provide most upgrades necessary to 
implement LRN by the second quarter of 1997. As noted above, Illinois, 
Georgia, and Colorado plan to deploy LRN in mid-1997. New York also 
expects to deploy LRN in mid-1997, though deployment in certain AT&T 
switches is expected to begin earlier. Michigan has ordered that 
implementation of long-term number portability in Michigan start at the 
same time that implementation begins in Illinois. BellSouth, however, 
estimates that three to five years are required to deploy a

[[Page 38616]]

number portability system that addresses all the necessary issues.
    68. Parties also differ on the interpretation of ``technically 
feasible'' as that term is used in section 251(b)(2) of the 1996 Act. 
GTE argues that the term should not be equated with ``technically 
possible'' because cost and timing considerations cannot be separated 
from the concept of technical feasibility. GTE also maintains that no 
long-term solution proposed is currently technically feasible, since 
they all require further information on costs, operation, and 
reliability. Bell Atlantic contends that deploying a system that is 
technically feasible, but inefficient, may not be consistent with 
Congress's goal of a ``rapid, efficient'' telecommunications system. 
Bell Atlantic and BellSouth also claim that LRN is merely a call 
handling protocol, as opposed to a technical solution for number 
portability.
    69. In contrast, Time Warner Holdings and Cox argue that 
``feasible'' must be given common dictionary meaning--``capable of 
being done, executed or effected''--and does not mean ``commercially 
available.'' Time Warner Holdings points out that equal access and 800 
number portability proved to be technically feasible even when they 
were not commercially available. Time Warner Holdings claims, moreover, 
that LECs control commercial availability because vendors will not 
develop and manufacture portability methods until LECs demand them. 
Similarly, Sprint argues that technically feasible does not mean that 
every operational and regulatory issue must be resolved before any 
decision on national number portability can be made. Sprint further 
claims that Congress's use of the phrase ``technically feasible'' 
precludes any consideration of economic feasibility. AT&T and MCI argue 
that LRN is technically feasible, although they do not explicitly 
address the precise meaning of the statutory language.
    70. Phased Implementation. Most parties addressing the 
implementation of number portability caution against a flash-cut 
approach (i.e., deployment nationwide simultaneously). USTA argues that 
because section 251(b)(2) only requires provision of number 
portability, not deployment of the necessary software and network 
upgrades, LECs need only deploy portability upon a bona fide request. 
Most parties, however, recommend that service provider portability be 
deployed on a per-market basis within a period of time specified by the 
Commission. For example, Competitive Carriers proposes that service 
provider portability be implemented in the 100 largest MSAs within 24 
months of this Order. Similarly, Sprint proposes that the Commission 
adopt a phased approach requiring local service providers to deploy a 
long-term solution upon receipt of a bona fide request from a certified 
carrier: (1) In the top 100 MSAs by the end of fourth quarter 1997; (2) 
in the next 135 MSAs, within 3-4 years after this Order is issued; and 
(3) within any remaining areas, beginning in the fifth year after this 
Order is issued. Omnipoint maintains that service provider portability 
should be made available in the top 100 MSAs between October of 1997 
and October of 1998, while GO Communications proposes implementation of 
service provider portability in the major metropolitan areas by early 
1997. MFS supports a final cut-over in the 100 largest MSAs by October 
1997, with an initial cut-over in the top 35 MSAs on March 31, 1997. It 
adds that, in order to deploy this capability as competition develops 
in specific markets, number portability should be implemented by LECs 
within 18 months of activation of an NXX code in the Local Exchange 
Routing Guide (LERG) and assignment to a competitor. AT&T has indicated 
that LRN deployment could begin in the third quarter of 1997 in one MSA 
in each of the seven BOC regions, followed by deployment in at least 
three additional MSAs per region during both fourth quarter 1997 and 
first quarter 1998. Once this initial phase is completed, AT&T suggests 
that the Commission could require LRN to be deployed in at least four 
additional MSAs during both second and third quarters 1998, or 105 MSAs 
total. AT&T's proposed plan would result in deployment of LRN software 
in a total of 7 MSAs in third quarter 1997, 21 additional MSAs in 
fourth quarter 1997, 21 additional MSAs in first quarter 1998, 28 
additional MSAs in second quarter 1998, and 28 additional MSAs in third 
quarter 1998. AT&T further asserts that its proposed schedule would 
require major switch manufacturers to update switch software at a rate 
of 53 switches per week, and that one major switch manufacturer has 
claimed that it alone can update 50 switches per week. MCI urges that 
number portability be deployed in the top 100 MSAs, by population, over 
a 10 month period beginning no later than June 30, 1997. After 
implementation is complete in the initial 100 MSAs, MCI recommends that 
the remaining MSAs be converted based on written requests from carriers 
filed with the Commission, which may order implementation in a 
particular MSA to be completed within six months of the request. MCI 
and Time Warner Holdings also support the notion of requiring number 
portability implementation within six months of a request of a 
telecommunications carrier. Finally, Ameritech argues it is premature 
to set a deployment schedule for LRN because there are several 
operational issues yet to be resolved. It further argues that schedules 
proposed by various carriers are too aggressive and exceed the 
resources of the industry.
    71. Switch vendors assert that LRN software will be generally 
available for service providers to deploy in 1997. Lucent Technologies 
plans general availability of LRN software for March 21, 1997, for its 
1A ESS switch; March 31, 1997, for its 5ESS-2000 switch; and May 1, 
1997, for its 4ESS switch. Lucent asserts that, after the new software 
becomes generally available, it will be able to support up to 50 
software release updates per week for the 5ESS and 1A ESS switches for 
North America (each release update upgrades the software for one 
switch). Nortel states that its LRN software will be available in the 
second quarter of 1997 for its DMS-100, DMS-200, and DMS-500 switches, 
and will be available in the third quarter of 1997 for its DMS-10 and 
TOPS switches. Siemens Stromberg-Carlson asserts that its LRN software 
will be available for testing on its EWSD switch in its Release 14.E 
generic in October 1996, and will be generally available in the first 
quarter of 1997. Siemens further claims that upgrades to EWSD switches 
deployed within the top 100 MSAs can be completed within five months of 
the date of general availability. Ericsson asserts that its LRN 
software for Ericsson SCPs will be generally available in the second 
quarter of 1997, and that its LRN software for Ericsson SSPs will be 
generally available in the third quarter of 1997. Ericsson expects that 
6-7 switch upgrades can be accomplished each week, with each upgrade 
taking 3-4 days.
    72. The Illinois Commerce Commission argues that a phased 
approach--implementing number portability in those areas where local 
competition is developing--may be more cost-effective and more feasible 
technically than a nationwide uniform deadline. Similarly, US West 
contends that a nationwide uniform deadline for service provider 
portability is neither practical nor necessary due to differing levels 
of competition. Sprint asserts that a phased implementation will 
accommodate the concerns of the small LECs, arguing that a phased 
approach best balances the need for rapid deployment with the capital 
constraints facing individual carriers. Nextel asserts that a phased 
approach is more efficient

[[Page 38617]]

because it results in the introduction of number portability where the 
demand for service provider portability is greatest. Bell Atlantic and 
US West contend that state agencies should determine when and where 
service provider portability should be introduced within their 
respective jurisdictions. Alternatively, US West suggests that the 
Commission could use the same approach to implementing service provider 
portability that it adopted in implementing equal access for 
independent LECs.
    73. Rural and Small LEC Exemption. In comments filed prior to 
passage of the 1996 Act, GVNW, TDS Telecom, NECA, and OPASTCO argue 
that, if the Commission mandates the implementation of number 
portability, it should exempt small and rural LECs from such a mandate. 
GNVW, NECA, and NTCA claim that the demand for service provider 
portability is significantly less in areas served by rural and small 
LECs because local exchange competition is not likely to develop there 
soon, if at all.
3. Discussion
    74. Section 251(b) requires that all local exchange carriers, as 
defined by section 153(26), ``provide, to the extent technically 
feasible, number portability in accordance with requirements prescribed 
by the Commission.'' We believe that requiring implementation of long-
term number portability by a date certain is consistent with the 1996 
Act's requirement that LECs provide number portability as soon as they 
can do so and will advance the 1996 Act's goal of encouraging 
competition in the local exchange market. The record indicates that at 
least one long-term method will be available for deployment in mid-
1997.
    75. We decline the suggestion of some parties that we direct an 
industry body to determine an appropriate implementation plan. The INC 
has been analyzing the issues surrounding number portability for over 
two years. Delegating responsibility for number portability 
implementation to an industry group such as the INC would unnecessarily 
delay implementation of number portability. Similarly, we reject 
BellSouth's arguments in favor of delaying implementation for three to 
five years. We believe such a delay is inconsistent with the 1996 Act's 
requirement that LECs make number portability available when doing so 
is technically feasible, as well as with the pro-competitive goals of 
the 1996 Act, and would not serve the public interest.
    76. Carriers filing comments in this proceeding have suggested 
various deployment schedules, with most suggesting deployment within 
two years of a Commission order or sooner. According to current 
schedules in Illinois, Georgia, Colorado, Maryland, and New York, 
AT&T's LRN method is scheduled for deployment (most likely excluding 
necessary field testing) beginning in mid-1997. Thus, the record 
indicates that one method for providing number portability will be 
available in mid-1997.
    77. Pursuant to our statutory authority under the 1996 Act, we 
require local exchange carriers operating in the 100 largest MSAs to 
offer long-term service provider portability commencing on October 1, 
1997, and concluding by December 31, 1998, according to the deployment 
schedule set forth in Appendix F of the Report and Order. We require 
deployment in one MSA in each of the seven BOC regions by the end of 
fourth quarter 1997, 16 additional MSAs by the end of first quarter 
1998, 22 additional MSAs by the end of second quarter 1998, 25 
additional MSAs by the end of third quarter 1998, and 30 additional 
MSAs by the end of fourth quarter 1998. As a practical matter, this 
obligation requires LECs to provide number portability to other 
telecommunications carriers providing local exchange or exchange access 
service within the same MSA. This schedule is consistent with switch 
vendor estimates that software for at least one long-term number 
portability method will be generally available for deployment by 
carriers around mid-1997, and with the schedule proposed by AT&T. One 
major switch manufacturer has claimed that it alone can support the 
deployment of number portability software in 50 switches per week. We 
conclude that a schedule consistent with AT&T's proposed schedule, 
which would require all of the major switch manufacturers collectively 
to update switch software at a total rate of 53 switches per week, 
appears workable.
    78. We note that, in establishing this schedule, we have relied 
upon representations of switch vendors concerning the dates by which 
the necessary switching software will be generally available. As a 
result, our deployment schedule depends directly upon the accuracy of 
those estimates and the absence of any significant technical problems 
in deployment. We delegate authority to the Chief, Common Carrier 
Bureau, to monitor the progress of local exchange carriers implementing 
number portability, and to direct such carriers to take any actions 
necessary to ensure compliance with this deployment schedule. We expect 
that the industry will work together to resolve any outstanding issues, 
technical or otherwise, which are involved with providing long-term 
number portability in accordance with our requirements and deployment 
schedule. We note that while we prescribe the time constraints within 
which LECs must implement number portability, we strongly encourage 
carriers to provide such portability before the Commission-imposed 
deadlines.
    79. In addition, we direct the carriers that are members of the 
Illinois Local Number Portability Workshop to conduct a field test of 
LRN or another technically feasible long-term number portability method 
that comports with our performance criteria concluding no later than 
August 31, 1997. We select the Chicago area for the field test because 
the record indicates that the Illinois workshop was responsible for 
drafting requirements for switching software currently being developed 
by switch manufacturers. Because of the significant work which has been 
done on behalf of the Illinois workshop, we believe the Chicago area is 
the best site within which to conduct a field test. The field test 
should encompass both network capability and billing and ordering 
systems, as well as maintenance arrangements. We delegate authority to 
the Chief, Common Carrier Bureau, to monitor developments during the 
field test. We further direct that the carriers participating in the 
test jointly file with the Bureau a report of their findings within 30 
days following completion of the test. While we do not routinely order 
field testing of telecommunications technologies as part of rulemaking 
proceedings, we have a significant interest in ensuring the integrity 
of the public switched network as number portability is deployed 
nationwide. We believe a field test will help to identify technical 
problems in advance of widespread deployment, thereby safeguarding the 
network.
    80. After December 31, 1998, each LEC must make long-term number 
portability available in smaller MSAs within six months after a 
specific request by another telecommunications carrier in the areas in 
which the requesting carrier is operating or plans to operate. 
Telecommunications carriers may file requests for number portability 
beginning January 1, 1999. Such requests should specifically request 
long-term number portability, identify the discrete geographic area 
covered by the request, and provide a tentative date six or more months 
in the future when the carrier expects to need number

[[Page 38618]]

portability in order to port prospective customers.
    81. We believe that this deployment schedule is consistent with the 
requirements of sections 251(b)(2) and (d), which give the Commission 
responsibility for establishing regulations regarding the provision of 
number portability to the extent technically feasible. As the record 
indicates, long-term number portability requires the use of one or more 
databases. Such databases have yet to be deployed. As indicated above, 
the methods for providing long-term number portability that would 
satisfy our criteria require the development of new switching software 
that is not currently available, but is under development. The record 
indicates, however, that at least one method of long-term number 
portability will be technically feasible by mid-1997. Requiring number 
portability to be fully operational in the largest 100 MSAs by December 
31, 1998, would allow a reasonable amount of time to install the 
appropriate generic and application software in the relevant switches. 
Moreover, such a phased deployment is preferable to implementing 
nationwide number portability simultaneously in all markets (or 
implementing this service in multiple large MSAs at the same time) 
because a phased deployment would be less likely to impose a 
significant burden on those carriers serving multiple regions of the 
country. Specifically, our phased approach spreads the implementation 
over 15 months, thus easing the burden on carriers serving multiple 
regions by limiting the number of MSAs in which implementation is 
required during a particular calendar quarter. In addition, the burden 
on such carriers should be less than that upon carriers in smaller 
markets because the latter may be required to undertake hardware 
upgrades whereas larger carriers may already have upgraded their 
switches. Our phased approach would also avoid the potential strain on 
vendors caused by implementation in all the largest 100 MSAs on or 
around a single date, as well as help to safeguard the integrity of the 
public switched telephone network.
    82. In addition, we believe that our phased implementation of long-
term number portability is in the public interest and supported by the 
record. Our phased deployment schedule takes in account the differing 
levels of local exchange competition that are likely to emerge in the 
different geographic areas throughout the country. Thus, our deployment 
schedule is designed to ensure that number portability will be made 
available in those regions where competing service providers are likely 
to offer alternative services. We believe that competitive local 
service providers are likely to be providing service in the major 
metropolitan areas soon. In those areas beyond the 100 largest MSAs, 
however, the actual pace of competitive entry into local markets should 
determine the need for service provider portability. We therefore agree 
with those parties that argue that, in markets outside of the 100 
largest MSAs, long-term number portability should be deployed within 
six months of a specific request from another telecommunications 
provider. We believe a six-month interval is appropriate given the more 
significant network upgrades that may be necessary for carriers 
operating in these smaller areas.
    83. We note that the 1996 Act exempts rural telephone companies 
from the ``duty to negotiate * * * the particular terms and conditions 
of agreements to fulfill the (interconnection) duties'' created by the 
1996 Act, including the provision of number portability, and that 
carriers satisfying the statutory criteria contained in section 251(f) 
may be exempt from the obligations to provide number portability as set 
forth herein. In addition, section 251(f)(2) permits a LEC with fewer 
than two percent of the country's total installed subscriber lines to 
petition a state commission for suspension or modification of the 
requirements of section 251. In our recent notice of proposed 
rulemaking implementing sections 251 and 252 of the Communications Act, 
we address the application of this statutory exemption, and we believe 
that specific application of such provisions is best addressed in that 
proceeding. We intend to establish regulations to implement these 
provisions by early August 1996, consistent with the requirements of 
section 251(d).
    84. In our Second Further Notice of Proposed Rulemaking on Billed 
Party Preference (BPP), we stated that the Commission would further 
consider the feasibility of implementing BPP in the upcoming proceeding 
to implement the 1996 Act's local number portability requirements in 
section 251(b)(2). We recognize that our deployment schedule may have 
implications for the provision of BPP, the ability of a customer to 
designate in advance which Operator Service Provider (OSP) should be 
billed when that customer makes a call from a pay telephone. This 
capability may involve querying a database, similar to the proposed 
long-term number portability methods. In the BPP Second Further Notice 
(61 FR 30581 (June 17, 1996)), we noted that the record indicated that 
the cost of BPP would likely be substantial, and we sought comment on 
the costs of requiring OSPs to disclose their rates for 0+ calls in a 
variety of circumstances. In that NPRM, we reaffirmed our belief that 
BPP would generate significant benefits for consumers, but stated that, 
at this time, unless local exchange providers were required to install 
the facilities needed to perform database queries for number 
portability purposes, the incremental cost to query the database for 
the customer's preferred OSP would outweigh the potential incremental 
benefits that BPP would provide. While we continue to recognize the 
benefits that could be achieved through such an approach, we note that 
creating the capability for all LECs to query OSP databases would 
require a uniform deadline to nationwide number portability which, for 
the reasons discussed above, is not in the public interest. 
Nonetheless, as indicated by our deployment schedule, LECs in the 100 
largest MSAs will be required to install the capability to query number 
portability databases by December 31, 1998, which could then 
potentially be utilized for BPP in those markets.
    85. Finally, we delegate to the Chief, Common Carrier Bureau, the 
authority to waive or stay any of the dates in the implementation 
schedule, as the Chief determines is necessary to ensure the efficient 
development of number portability, for a period not to exceed 9 months 
(i.e., no later than September 30, 1999). In the event a carrier is 
unable to meet our deadlines for implementing a long-term number 
portability method, it may file with the Commission, at least 60 days 
in advance of the deadline, a petition to extend the time by which 
implementation in its network will be completed. We emphasize, however, 
that carriers are expected to meet the prescribed deadlines, and a 
carrier seeking relief must present extraordinary circumstances beyond 
its control in order to obtain an extension of time. A carrier seeking 
such relief must demonstrate through substantial, credible evidence the 
basis for its contention that it is unable to comply with our 
deployment schedule. Such requests must set forth: (1) The facts that 
demonstrate why the carrier is unable to meet our deployment schedule; 
(2) a detailed explanation of the activities that the carrier has 
undertaken to meet the implementation schedule prior to requesting an 
extension of time; (3) an identification of the particular switches for 
which the extension is requested; (4) the time within which the carrier 
will

[[Page 38619]]

complete deployment in the affected switches; and (5) a proposed 
schedule with milestones for meeting the deployment date.

E. Database Architecture and Administration

1. Background
    86. In the NPRM, we sought comment on the type of database 
architecture that would best serve the public interest and the 
technical feasibility of deploying a single national database or a 
series of regionally distributed databases. We also sought comment on 
the type of information that should be contained within such 
database(s) and who should have access to such database(s). Finally, we 
sought comment on administration of the number portability database(s), 
i.e., who should administer and maintain the database(s), how should 
they be funded, how should the administrator(s) be selected, and what 
responsibilities should the administrator(s) be given.
2. Position of the Parties
    Many parties assert that any long-term number portability solution 
will require the use of one or more databases. Jones Intercable states 
that use of a database solution: (1) Makes numbering information 
available to numerous competing carriers; (2) provides the platform to 
offer other types of number portability; and (3) permits the deployment 
of other advanced services. ACTA, AT&T, and Citizens Utilities assert 
that the database architecture of a long-term solution should resemble 
the architecture used for the toll free database, but with databases 
distributed on a regional basis. US Intelco and MCI note that multiple, 
regional databases, rather than one national database, will be 
necessary to process the data for all portable geographic numbers. Only 
Scherers Communications claims that a single national database will be 
able to accommodate all portable numbers, geographic and non-
geographic, and will ensure consistency and cost efficiency.
    88. AT&T and several BOCs support the ability of individual 
carriers to download information from the regional databases to routing 
systems associated with their own networks, i.e., downstream databases. 
Several other parties add that access to the regional databases must be 
open, and carriers, individually or collectively, must be permitted to 
develop routing databases that obtain information from the regional 
databases. ITN contends that an architecture of regionally-deployed 
SCPs which correspond to blocks of NPA-NXXs would give carriers the 
option of maintaining their own customer records or having a third 
party provider perform such functions. It adds that such openness in 
data management will help ensure number portability to all service 
providers, including providers of service to end users and various 
other intelligent network service providers.
    89. Almost all parties, incumbent LECs and new entrants, support 
administration of the database(s) by a neutral third party. MFS adds 
that the operator of a number portability database must not be able to 
gain a competitive advantage by manipulating the data or controlling 
access to the database. ACTA urges that the database administrator be a 
non-profit organization selected through a competitive bidding process 
that excludes LECs and IXCs, with responsibilities established by the 
North American Numbering Plan Administrator (NANPA).
    90. Competitive Carriers assert that the database(s) should include 
only service provider portability-specific information, and that the 
carriers using the database should be responsible for the integrity of 
these data. Teleport claims that an industry group should determine the 
contents of any distributed databases, subject to the Commission's 
criteria. The Texas Advisory Commission also asserts that the 
database(s) should easily integrate with 911 databases.
3. Discussion
    91. Section 251(b) directs the Commission to establish requirements 
governing the provision of number portability without specifically 
addressing the appropriate database architecture necessary for long-
term number portability. We find that an architecture that uses 
regionally-deployed databases best serves the public interest and is 
supported by the record. The deployment of multiple regional databases 
will facilitate the ability of LECs to provide number portability by 
reducing the distance that such carriers will have to transmit carrier 
routing information. This, in turn, should reduce the costs of routing 
telephone calls based on such data. Moreover, a nationwide system of 
regional databases would relieve individual carriers of the burden of 
deploying multiple number portability databases over various geographic 
areas. A regionally-deployed database system will ensure that carriers 
have the number portability routing information necessary to route 
telephone calls between carriers' networks, and will also promote 
uniformity in the provision of such number portability data. We agree 
with those parties arguing that one national number portability 
database is not feasible. The potential amount of information that such 
a database would be required to process would, according to parties in 
this proceeding, likely become overwhelming as number portability is 
deployed nationwide.
    92. We also conclude that it is in the public interest for the 
number portability databases to be administered by one or more neutral 
third parties. Both the record and the Commission's recent decision to 
reorganize the administration of telephone numbers under the NANP 
support neutral third party administration of these facilities. We also 
note that section 251(e)(1) requires the Commission to ``create or 
designate one or more impartial entities to administer 
telecommunications numbering and to make such numbers available on an 
equitable basis.'' Neutral third party administration of the databases 
containing carrier routing information will facilitate entry into the 
communications marketplace by making numbering resources available to 
new service providers on an efficient basis. It will also facilitate 
the ability of local service providers to transfer new customers by 
ensuring open and efficient access for purposes of updating customer 
records. As we stated above, the ability to transfer customers from one 
carrier to another, which includes access to the data necessary to 
perform that transfer, is important to entities that wish to compete in 
the local telecommunications market. Neutral third party administration 
of the carrier routing information also ensures the equal treatment of 
all carriers and avoids any appearance of impropriety or anti-
competitive conduct. Such administration facilitates consumers' access 
to the public switched network by preventing any one carrier from 
interfering with interconnection to the database(s) or the processing 
of routing and customer information. Neutral third party administration 
would thus ensure consistency of the data and interoperability of 
number portability facilities, thereby minimizing any anti-competitive 
impacts.
    93. We hereby direct the NANC to select as a local number 
portability administrator(s) (LNPA(s)) one or more independent, non-
governmental entities that are not aligned with any particular 
telecommunications industry segment within seven months of the initial 
meeting of the NANC. Selection of the LNPA(s) falls within the duties 
we established for the NANC in the

[[Page 38620]]

Numbering Plan Order (60 FR 38737 (July 28, 1995)) and the NANC 
Charter. The NANC charter describes the scope the NANC's activities:

    The purpose of the (NANC) is to advise the (Commission) and to 
make recommendations, reached through consensus, that foster 
efficient and impartial number administration. The (NANC) will 
develop policy on numbering issues, initially resolve disputes, and 
select and provide guidance to the North American Numbering Plan 
Administrator.

The fundamental purpose of the NANC is to act as an oversight committee 
with the technical and operational expertise to advise the Commission 
on numbering issues. The Commission has already directed the NANC to 
select a NANPA. We believe the designation of a centralized entity to 
select and oversee the LNPA(s) is preferable to ensure consistency and 
to provide a national perspective on number portability issues, as well 
as to reduce the costs of implementing a national number portability 
plan.
    94. We believe that the NANC is especially well-situated to handle 
matters relating to local number portability administration because of 
its similarity to the administration of central office codes. Both 
functions rely heavily on the use of databases, and both involve 
administration of NANP resources, only at different levels. 
Administration of number portability data is essentially the 
administration of telephone numbers (as opposed to NXX codes) between 
different carriers.
    95. We believe that the NANC should determine, in the first 
instance, whether one or multiple administrators should be selected, 
whether LNPA(s) can be the same entity selected to be the NANPA, how 
the LNPA(s) should be selected, the specific duties of the LNPA(s), and 
the geographic coverage of the regional databases. Once the NANC has 
selected the LNPA(s) and determined the locations of the regional 
databases, it must report its decisions to the Commission. The NANC 
should also determine the technical interoperability and operational 
standards, the user interface between telecommunications carriers and 
the LNPA(s), and the network interface between the SMS and the 
downstream databases. Finally, the NANC should develop the technical 
specifications for the regional databases, e.g., whether a regional 
database should consist of a service management system (SMS) or an SMS/
SCP pair. In reaching its decisions, the NANC should consider the most 
cost-effective way of accomplishing number portability. We note that it 
will be essential for the NANPA to keep track of information regarding 
the porting of numbers between and among carriers. We thus believe it 
necessary for the NANC to set guidelines and standards by which the 
NANPA and LNPA(s) share numbering information so that both entities can 
efficiently and effectively administer the assignment of the numbering 
resource. For example, the NANC might require that the databases easily 
integrate with 911 databases.
    96. We recognize that authorizing the NANC to select a LNPA(s) may 
have an impact on Illinois's April 1996 selection of Lockheed-Martin as 
the administrator of the Illinois SMS, as well as the Maryland and 
Colorado task forces' plans to release their RFPs for their SMS 
administrators in the second quarter of 1996. Therefore, in light of 
these and other ongoing efforts by state commissions, we conclude that 
any state that prefers to develop its own statewide database rather 
than participate in a regionally-deployed database may opt out of its 
designated regional database and implement a state-specific database. 
We direct the Chief, Common Carrier Bureau, to issue a Public Notice 
that identifies the administrator selected by the NANC and the proposed 
locations of the regional databases. A state will have 60 days from the 
release date of the Public Notice to notify the Common Carrier Bureau 
and NANC that the state does not wish to participate in the regional 
database system for number portability. Carriers may challenge a 
state's decision to opt out of the regional database system by filing a 
petition with the Commission. Relief will be granted if the petitioner 
can demonstrate that the state decision to opt out would significantly 
delay deployment of permanent number portability or result in excessive 
costs to carriers. We note that state databases would have to meet the 
national requirements and operational standards recommended by the NANC 
and adopted by this Commission. In addition, such state databases must 
be technically compatible with the regional system of databases and 
must not interfere with the scheduled implementation of the regional 
databases.
    97. We further note that any administrator selected by a state 
prior to the release of this Order that wishes to bid for 
administration of one of the regional databases must submit a new 
proposal in accordance with the guidelines established by the NANC. We 
emphasize that nothing in this section affects any other action that 
the Commission may take regarding the delegation and transfer of 
functions related to number administration. We delegate authority to 
the Chief, Common Carrier Bureau, to monitor the progress of the NANC 
in selecting the LNPA(s) and in developing and implementing the 
database architecture described above.
    98. We believe that telecommunications carriers should have open 
access to all regional databases. Just as we conclude all carriers must 
have equal access to any long-term number portability method, and that 
no portion of a long-term number portability method should be 
proprietary to any carrier, we further conclude that all carriers must 
have equal and open access to all regionally-deployed databases 
containing number portability-specific data. Allowing particular 
carriers access to the databases over others would be inherently 
discriminatory and anti-competitive. All carriers providing number 
portability need to have access to all relevant information to be able 
to provide customers with this important capability. We thus conclude 
that the 1996 Act, in addition to general rules of equity and 
competitive neutrality, requires equal and open access to all 
regionally-deployed databases for all carriers wishing to interconnect.
    99. We believe that, at this time, the information contained in the 
number portability regional databases should be limited to the 
information necessary to route telephone calls to the appropriate 
service providers. The NANC should determine the specific information 
necessary to provide number portability. To include, for example, the 
information necessary to provide E911 services or proprietary customer-
specific information would complicate the functions of the number 
portability databases and impose requirements that may have varied 
impacts on different localities. For instance, because different 
localities have adopted different emergency response systems, the 
regional databases would have to be configured in such a fashion as to 
provision the appropriate emergency information to each locality's 
particular system. Similarly, special systems would need to be 
developed to restrict access to proprietary customer-specific 
information. In either instance, the necessary programming to add such 
capabilities to the regional databases would complicate the 
functionality of those databases.
    100. Because we require open access to the regional databases, it 
would be inequitable to require carriers to disseminate, by means of 
those databases, proprietary or customer-specific information. We 
therefore contemplate that the regional

[[Page 38621]]

deployment of databases will permit individual carriers to own and 
operate their own downstream databases. These carrier-specific 
databases will allow individual carriers to provide number portability 
in conjunction with other functions and services. To the extent that 
individual carriers wish to mix information, proprietary or otherwise, 
necessary to provide other services or functions with the number 
portability data, they are free to do so at their downstream databases. 
We reiterate, however, that a carrier may not withhold any information 
necessary to provide number portability on the grounds that such data 
are combined with other information in its downstream database; it must 
furnish all information necessary to provide number portability to the 
regional databases as well as to its own downstream database.
    101. Carriers that choose not to access directly the regional 
databases or deploy their own downstream databases can seek access to 
the carrier-specific databases deployed by other carriers. The 
provision of access to network elements and facilities of incumbent 
LECs is addressed in our proceeding implementing section 251 of the 
Communications Act. We believe the issue of access to incumbent LECs' 
carrier-specific databases by other carriers for purposes of number 
portability is best addressed in that proceeding. Parties may negotiate 
third-party access to non-incumbent LECs' carrier-specific databases on 
an individual basis.
    102. In the Numbering Plan Order, we concluded that the Commission 
should invoke its statutory authority to recover its costs for 
regulating numbering activities, including costs incurred from the 
establishment, oversight of, and participation in the NANC. The 
Commission is required to institute a rulemaking proceeding annually to 
adjust the schedule of regulatory fees to reflect its performance of 
activities relating to enforcement, policy and rulemaking, user 
information services, and international activities, pursuant to the 
relevant appropriations legislation. Therefore, we intend to include 
the additional costs incurred by the Commission related to NANC and 
regulating number portability in the fiscal 1997 adjustment of the 
schedule of regulatory fees. In that proceeding, we will assess the 
nature and amount of the additional burdens imposed by the activities 
authorized here, and all interested parties will be afforded an 
opportunity to comment.

F. Currently Available Number Portability Measures

1. Background
    103. In the NPRM, we discussed certain currently available number 
portability measures that LECs can use to provide service provider 
number portability. We focused on RCF and DID and acknowledged that the 
use of either method for number portability has significant 
limitations. We sought comment on the costs of implementing these 
measures, and on their limitations and disadvantages. We also requested 
that parties discuss whether these currently available measures can be 
improved so that they are workable, long-term solutions, and if so, at 
what cost. Finally, we sought comment on how the costs of providing 
service provider portability using RCF and DID should be recovered.
2. Implementation of Currently Available Number Portability Measures
a. Positions of the Parties
    104. Commenting parties, with the exception of several of the 
incumbent LECs, generally agree that the technical limitations 
described in the NPRM render the interim measures unacceptable in the 
long term. Indeed, many parties point out additional disadvantages of 
RCF and DID, such as: Longer call set-up times, incumbent access to 
competitors' proprietary information, complicated resolution of 
customer complaints, increased potential for call blocking, and 
substantial costs to new entrants. Bell Atlantic counters that calls 
forwarded by RCF in its network can support CLASS features if the co-
carrier has modern digital switching equipment and common channel 
signalling, and it adds that there is no limit on the number of calls 
RCF can handle simultaneously.
    105. Many of the new entrants, nevertheless, urge the Commission to 
require incumbent LECs to provide interim measures until a long-term 
solution is implemented. These carriers generally caution that use of 
interim solutions should not delay implementation of a permanent 
solution. While acknowledging that RCF and DID are already technically 
feasible and generally available, several LECs argue that the 
Commission need not take action on interim measures. They generally 
focus, instead, on phasing in a long-term solution.
    106. AT&T and MCI initially argued for using a medium-term database 
solution, namely, the Carrier Portability Code (CPC) method, because of 
its advantages over RCF or DID, but subsequently favored implementing 
LRN as soon as possible. NYNEX and SBC Communications claim that 
adopting CPC as an interim solution would result in wasted and 
duplicative efforts. They note that CPC fails to support certain 
services, such as ISDN calls, pay phone calls, and CLASS features when 
customers place a call into an NXX from which a number has been 
transferred to a different service provider, and that CPC may prevent 
an operator from identifying the switch serving a ``ported'' number, 
thereby interfering with busy line verification of that line.
    107. Potential new entrants into the local exchange market 
generally contend that requiring interim number portability is 
consistent with the 1996 Act. Indeed, MFS maintains that the 1996 Act 
requires immediate implementation of interim measures until long-term 
portability is implemented. Teleport notes that the Bell Operating 
Companies, at least, are required to provide interim number portability 
as a condition of entry into the interLATA market. MCI agrees that 
interim measures should be made available until long-term portability 
is implemented, and argues that section 4(i) of the Communications Act 
authorizes the Commission to perform any acts ``necessary and proper'' 
to execute section 251(b)(2), and that such authority is pre-existing 
and remains in effect. ALTS contends that Congress clearly contemplated 
that the Commission should require interim measures until long-term 
portability is available because otherwise BOCs could satisfy the 
competitive checklist of section 271(c)(2)(B)(xi) for entry in 
interLATA services without providing any form of number portability. 
AT&T argues that interim arrangements are incapable of preserving the 
functionality for long-term number portability required by the 1996 
Act, but should be provided until long-term number portability can be 
deployed.
    108. US West, in contrast, asserts that the Commission's 
jurisdiction over interim measures is unclear because sections 153(30) 
and 251(b)(2), giving the Commission jurisdiction over number 
portability, appear to include only permanent portability. Cox and NCTA 
claim that the interim measures do not satisfy the ``without impairment 
of quality, reliability, or convenience'' standard in the definition of 
number portability in 47 U.S.C. section 153(30).
    109. Several of the cable interests argue that, although section 
271(c)(2)(B)(xi) allows the BOCs initially to satisfy the competitive

[[Page 38622]]

checklist for entry into interLATA services by providing only interim 
measures, the BOCs are also required to provide long-term portability 
to fulfill the checklist requirements. Moreover, Cox and Time Warner 
Holdings warn that the Commission will lose its leverage to encourage 
prompt implementation of long-term portability once the BOCs are 
permitted to provide in-region interLATA services pursuant to section 
271. NCTA asserts that, since section 271(c)(2)(B)(xi) distinguishes 
between ``interim'' measures and ``regulations pursuant to section 251 
to require number portability,'' the portability required by section 
251 is long-term number portability. CCTA urges the Commission to 
review and require BOC progress toward deployment of a long-term method 
when BOCs apply for in-region interLATA market entry, and to deny a BOC 
application if the BOC tries to delay implementation of long-term 
portability. Cox goes further and argues that, after the Commission 
adopts number portability rules, BOCs must implement long-term service 
provider portability, not just interim measures, before they can obtain 
interexchange and manufacturing relief under section 271 because 
interim measures do not satisfy section 251. In response, Ameritech 
contends that provision of interim measures, and later compliance with 
the Commission's portability rules, satisfies the BOC checklist and 
notes that section 271(d)(4) directs the Commission not to limit or 
extend the checklist terms.
b. Discussion
    110. The 1996 Act requires that carriers ``provide, to the extent 
technically feasible, number portability in accordance with the 
requirements prescribed by the Commission.'' Number portability is 
defined in the 1996 Act as ``the ability of users of telecommunications 
services to retain, at the same location, existing telecommunications 
numbers without impairment of quality, reliability, or convenience when 
switching from one telecommunications carrier to another.'' The record 
indicates that currently technically feasible methods of providing 
number portability, such as RCF and DID, may impair to some degree 
either the quality, reliability, or convenience of telecommunications 
services when customers switch between carriers. Because of these 
drawbacks, some may argue that the use of RCF and DID methods for 
providing number portability would not satisfy the requirements of 
sections 3(30) and 251(b)(2). We disagree. Section 251(b)(2) 
specifically requires carriers to provide number portability, as 
defined in section 3(30), ``to the extent technically feasible.'' Thus, 
because currently RCF and DID are the only methods technically 
feasible, we believe that use of these methods, in fact, comports with 
the requirements of the statute. We believe that the 1996 Act 
contemplates a dynamic, not static, definition of technically feasible 
number portability methods. Under this view, LECs are required to offer 
number portability through RCF, DID, and other comparable methods 
because they are the only methods that currently are technically 
feasible. LECs are required by this Order to begin the deployment of a 
long-term number portability solution by October 1, 1997, because, 
based on the evidence of record, such methods will be technically 
feasible by that date. We believe that this conclusion is consistent 
with Congress's goal of developing a national number portability 
framework, as well as the general purpose of the Act to ``promote 
competition * * * in order to secure lower prices and higher quality 
services for American telecommunications consumers and encourage the 
rapid deployment of new technologies.''
    111. This interpretation finds further support in section 
271(c)(2)(B)(xi), which sets forth the competitive checklist for BOC 
entry into in-region interLATA services. That section requires the BOCs 
wishing to enter the in-region interLATA market: (1) To provide interim 
number portability through RCF, DID, and other comparable arrangements 
``until the date by which the Commission issues regulations pursuant to 
section 251 to require number portability,'' and then (2) to comply 
with the Commission's regulations. There will necessarily be a 
significant time period between the adoption date of these rules and 
the availability of long-term number portability measures. Therefore, 
were the Commission to promulgate rules providing only for the 
provision of long-term number portability, during this time period the 
BOCs could satisfy the competitive checklist without providing any form 
of number portability. This could be true even if they had been 
providing interim number portability pursuant to the checklist prior to 
the effective date of the Commission's regulations. We do not believe 
that Congress could have intended this result. We, therefore, agree 
with MFS, ALTS, MCI, and AT&T that Congress intended that currently 
available number portability measures be provided until a long-term 
number portability method is technically feasible and available.
    112. We conclude that we had authority to require the provision of 
currently available methods of service provider portability prior to 
passage of the 1996 Act. In the NPRM, we tentatively concluded that 
sections 1 and 202 of the Communications Act establish a federal 
interest in the provision of number portability. Specifically, we 
concluded in the NPRM that such interest arises from: (1) Our 
obligation to promote an efficient and fair telecommunications system; 
(2) the inability to separate the impact of number portability between 
intrastate and interstate telecommunications; (3) the potential adverse 
impact deploying different number portability solutions across the 
country would have on the provision of interstate telecommunications 
services; and (4) the impact number portability could have on the use 
of the numbering resource, that is, ensuring that the use of numbers is 
efficient and does not contribute to area code exhaust. We now affirm 
these tentative conclusions and conclude that we have jurisdiction to 
require the provision of currently available number portability 
methods, independent of the statutory changes adopted in the 1996 Act.
    113. There are also substantial policy reasons that support our 
requiring LECs to provide currently available number portability 
measures. The ability of customers to keep their telephone numbers when 
changing carriers, even with some impairment in call set-up time or 
vertical service offerings, is critical to opening the local 
marketplace to competition. By facilitating entry of new carriers into 
the local market, currently available number portability measures will 
increase competition in local markets which will result in lower prices 
and higher service quality for telecommunications services consistent 
with the goals of the 1996 Act. Several parties to this proceeding 
likewise advocate that such measures are necessary for the development 
of effective local exchange competition.
    114. We note that sections 251(b)(2) and 251(d) give to the 
Commission the authority to prescribe requirements for the provision of 
number portability. Pursuant to that authority, we mandate the 
provision of currently available number portability measures as soon as 
reasonably possible upon receipt of a specific request from another 
telecommunications carrier, including from wireless service providers. 
By conditioning the obligation to provide currently available number 
portability measures upon a specific request,

[[Page 38623]]

number portability will be offered only in those areas where a 
competing local exchange carrier seeks to provide service. Thus, it 
avoids the imposition of number portability implementation costs on 
carriers (and end users) in areas where no competitor is operating.
    115. We agree with the many parties who claim that the technical 
limitations described in the NPRM that handicap all currently available 
measures for providing number portability render them unacceptable as 
long-term solutions. Despite Bell Atlantic's claims to the contrary for 
its own network, the record indicates that currently available number 
portability measures are inferior to LRN portability or any other 
method that meets our performance criteria. The 1996 Act, and 
particularly the BOC checklist in section 271, clearly contemplates 
that these methods should serve as only temporary measures until long-
term number portability is implemented. As indicated above, the 1996 
Act requires that number portability be provided, to the extent 
technically feasible, without impairment of quality, reliability, and 
convenience. Therefore, when a number portability method that better 
satisfies the requirements of section 251(b)(2) than currently 
available measures becomes technically feasible, LECs must provide 
number portability by means of such method. In addition, we find that 
the existing measures fail to satisfy our criteria set forth for any 
long-term solution; for example, they depend on the original service 
provider's network, may result in the degradation of service quality, 
and are wasteful of the numbering resource. For these reasons, we do 
not believe that long-term use of the currently available measures is 
in the public interest. We emphasize that we encourage all LECs to 
implement a long-term solution that meets our technical standards as 
soon as possible. We also note that BOCs must comply with the 
requirements set forth in this Order, including the requirement to 
provide currently available measures, in order to satisfy the BOC 
competitive checklist. Upon the date on which long-term portability 
must be implemented according to our deployment schedule, BOCs must 
provide long-term number portability and will be subject to an 
enforcement action under section 271(d)(6) if they fail to do so.
    116. We decline to require a ``medium-term'' or short-term database 
solution such as CPC. The increased costs of implementing this approach 
are unwarranted given the imminent implementation of a long-term 
solution that meets our criteria. In addition, devoting resources to 
implement a medium-term database solution, which is currently not 
available, may delay implementation of a long-term database solution. 
We note that the Colorado, Georgia, Illinois, and Ohio state 
commissions have declined to adopt, and the California and Maryland 
task forces have declined to recommend, CPC as an interim solution, 
while the emphasis on New York's CPC trial has shifted in favor of 
concentrating on the adoption of LRN. We also note that several parties 
originally advocating CPC have since retreated from that view and now 
instead support implementing a long-term database solution as soon as 
possible. To the extent carriers wish to provide a medium-term database 
solution, such as CPC, however, we do not prevent them from doing so.
3. Cost Recovery for Currently Available Number Portability Measures
a. Positions of the Parties
    117. In comments filed before passage of the 1996 Act, Cablevision 
Lightpath argues that all carriers should pay incremental, cost-based 
rates for interim measures and suggests, as an example, an annual 
surcharge based on the product of the incremental cost of switching and 
minutes of traffic forwarded. AT&T and MCI agree with Cablevision 
Lightpath and endorse the formula used by the New York Department of 
Public Service, which allocates the costs of providing interim measures 
across all carriers based on the product of switching and transport 
costs, and minutes of forwarded traffic. Cablevision Lightpath urges, 
however, the Commission to ban incumbent LECs from treating the costs 
of currently available number portability as exogenous adjustments to 
their interstate price cap indices. GSA, Jones Intercable, and the 
Users Committee point out that the short-term incremental costs of 
providing interim measures are low.
    118. Many of the new entrants advocate placing much of the burden 
of cost-recovery for interim measures on the incumbent LECs. Jones 
Intercable, along with several other cable interests, argues that the 
incumbent LECs and new LECs should recover the costs of interim 
measures under a ``bill and keep'' system, under which incumbent LECs 
and new entrants would not charge each other for interim number 
portability arrangements that require them to forward calls of 
customers who have changed service providers. In the alternative, Jones 
Intercable contends that incumbent LECs' charges for interim number 
portability services should be equal to or less than the LECs' 
incremental cost of providing those services. Teleport also supports 
the provision of interim portability measures with no intercarrier 
usage charges.
    119. Several commenters propose large discounts comparable to those 
mandated for non-equal access during the transition to equal access. 
Competitive Carriers assert that allowing LECs to charge retail prices 
would discourage provision of long-term number portability. MCI argues 
that portability is a network function, not a service, and proposes 
that all local carriers share the costs or at least that incumbent LECs 
not be allowed to recover more than the incremental costs. AT&T and MFS 
argue that any interim measures should be provided at rates that 
encourage incumbents to offer the most efficient routing available, or 
reflect these measures' inferior quality and true costs. ALTS and MFS 
further argue that competitive local exchange carriers should be 
entitled to retain all terminating access charges. Similarly, MCI and 
NCTA argue that the terminating access charges paid by IXCs should be 
shared with the competitor that actually completes calls forwarded to 
it.
    120. AT&T and MCI argue that the 1996 Act requires that the costs 
of providing interim number portability measures be borne by all 
telecommunications carriers on a competitively neutral basis. MFS 
argues that interim measures should be provided at no cost or in the 
alternative, allocated on revenues net of payments to intermediaries. 
Several LECs, in contrast, claim that the competitively neutral 
standard prohibits requiring incumbent LECs to subsidize their 
competitors by providing interim measures for free or at deeply 
discounted rates. Ameritech asserts that section 251(e)(2)'s 
``competitively neutral'' standard for cost recovery does not apply to 
interim portability at all. It asserts that interim portability is 
addressed in section 271(c)(2)(B)(xi), and therefore the Commission is 
not authorized under the BOC checklist to eliminate or discount interim 
portability rates below levels that state commissions have already 
judged reasonable. Similarly, BellSouth argues that Congress's 
endorsement of interim RCF and DID arrangements in the BOC checklist, 
and the 1996 Act's structure of requiring state-approved carrier 
negotiations for interconnection agreements, compel the conclusion that 
RCF and DID cost recovery issues be left to the states.

[[Page 38624]]

b. Discussion
    121. In light of our statutory mandate that local exchange carriers 
provide number portability through RCF, DID, or other comparable 
arrangements until a long-term number portability approach is 
implemented, we must adopt cost recovery principles for currently 
available number portability that satisfy the 1996 Act. We emphasize 
that the cost recovery principles set forth below will apply only until 
a long-term number portability method can be deployed. As we have 
indicated, deployment of long-term number portability should begin no 
later than October 1997, so currently available number portability 
arrangements, and the associated cost recovery mechanism, should be in 
place for a relatively short period.
    122. It is also important to recognize that the costs of currently 
available number portability are incurred in a substantially different 
fashion than the costs of long-term number portability arrangements. 
First, the capability to provide number portability through currently 
available methods, such as RCF and DID, already exists in most of 
today's networks, and no additional network upgrades are necessary. In 
contrast, long-term, or database, number portability methods require 
significant network upgrades, including installation of number 
portability-specific switch software, implementation of SS7 and IN or 
AIN capability, and the construction of multiple number portability 
databases. Second, the costs of providing number portability in the 
immediate term are incurred solely by the carrier providing the 
forwarding service. Long-term number portability, in contrast, will 
require all carriers to incur costs associated with the installation of 
number portability-specific software and the construction of the number 
portability databases. Those costs will have to be apportioned in some 
fashion among all carriers. Finally, we note that, initially, the costs 
of providing currently available number portability will be incurred 
primarily by the incumbent LEC network because most customers will be 
forwarding numbers from the incumbents to the new entrants.
    123. Parties have advanced a wide range of methods for recovering 
the costs of currently available number portability measures, including 
arrangements whereby neither carrier charges the other for provision of 
such measures and incremental, cost-based pricing schemes. In addition, 
several states have adopted different cost recovery mechanisms. For 
example, in Florida, carriers have negotiated appropriate rates for 
currently available measures. The Louisiana PSC has adopted a two-
tiered approach to pricing of currently available measures. In the 
first instance, carriers are permitted to negotiate an appropriate 
rate. If the parties cannot agree upon a rate, the PSC will determine 
the appropriate rate that can be charged by the forwarding carrier 
based on cost studies filed by the carriers. These rates are not 
required to be set at long-run incremental costs (LRIC) or total 
service long-run incremental costs (TSLRIC), however.
    124. In addition, incumbents and new entrants have voluntarily 
negotiated a variety of cost recovery methods. Carriers in Rochester, 
New York, for example, are voluntarily using a formula that allocates 
the incremental costs of currently available number portability 
measures, through an annual surcharge assessed by the carrier from 
which the number is transferred. The charge assessed on each carrier is 
the product of the total number of forwarded minutes and the 
incremental per-minute costs of switching and transport, multiplied by 
the ratio of a particular carrier's forwarded telephone numbers 
relative to total working numbers in the area. In addition, Rochester 
Telephone has agreed not to charge competitors for the first $1 million 
of the cost of number portability. The New York DPS has adopted this 
formula for the New York Metropolitan area as well. Ameritech and MFS 
recently entered into an agreement for Ameritech's five-state region 
under which MFS will pay Ameritech $3 per line per month for interim 
measures. MFS plans to seek regulatory approval to allocate that cost 
under a formula that would require MFS to pay a portion of the $3 
charge equal to the ratio of MFS's gross telecommunications service 
revenues, net of its payments to other carriers, to Ameritech's gross 
telecommunications revenues, net of payments to other carriers.
    125. Our cost recovery principles for currently available methods, 
of course, must comply with the statutory requirements of the 1996 Act. 
In addition, consistent with the pro-competitive objectives of the 1996 
Act, we seek to create incentives for LECs, both incumbents and new 
entrants, to implement long-term number portability at the earliest 
possible date, since, as we have noted, long-term number portability is 
clearly preferable to existing number portability methods. The 
principles we adopt should also mitigate any anti-competitive effects 
that may arise if a carrier falsely inflates the cost of currently 
available number portability.
    126. In our interconnection proceeding, we have sought comment on 
our tentative conclusion that the 1996 Act authorizes us to set pricing 
principles to ensure that rates for interconnection, unbundled network 
elements, and collocation are just, reasonable, and nondiscriminatory. 
We need not, however, reach in this proceeding the issue of whether 
section 251 generally gives us authority over pricing for 
interconnection because the statute sets forth the standard for the 
recovery of number portability costs and grants the Commission the 
express authority to implement this standard. Specifically, section 
251(e)(2) requires that the costs of ``number portability be borne by 
all telecommunications carriers on a competitively neutral basis as 
determined by the Commission.'' We therefore conclude that section 
251(e)(2) gives us specific authority to prescribe pricing principles 
that ensure that the costs of number portability are allocated on a 
``competitively neutral'' basis.
    127. In exercising our authority under section 251(e)(2), we 
conclude that we should adopt guidelines that the states must follow in 
mandating cost recovery mechanisms for currently available number 
portability methods. To date, the state commissions have adopted 
different cost recovery methods. We seek to articulate general criteria 
that conform to the statutory requirements, but give the states some 
flexibility during this interim period to continue using a variety of 
approaches that are consistent with the statutory mandate. The states 
are also free, if they so choose, to require that tariffs for the 
provision of currently available number portability measures be filed 
by the carriers.
    128. In establishing the standard for number portability cost 
recovery, section 251(e)(2) sets forth three specific elements, which 
we must interpret. First, we must determine the meaning of number 
portability ``costs;'' second, we must interpret the phrase ``all 
telecommunications carriers;'' and third, we must construe the meaning 
of the phrase ``competitively neutral.''
    129. The costs of currently available number portability are the 
incremental costs incurred by a LEC to transfer numbers initially and 
subsequently forward calls to new service providers using existing RCF, 
DID, or other comparable measures. According to the record, the costs 
of RCF differ depending on where the call originates in a carrier's 
network. Calls that originate on the switch from which a number has 
been forwarded (intraoffice

[[Page 38625]]

calls) result in fewer costs than calls that originate from other 
switches (interoffice calls). This is because fewer transport and 
switching costs are incurred in the forwarding of an intraoffice call. 
The BOCs claim, for example, that there are essentially three costs 
incurred in the provision of RCF for an intraoffice call: (1) Switching 
costs incurred by the original switch in determining that the number is 
no longer resident; (2) switching costs incurred in performing the RCF 
translation, which identifies the address of the receiving switch; and 
(3) switching costs incurred in redirecting the call from the original 
switch to the switch to which the number has been forwarded. The BOCs 
further assert that the additional costs incurred for an interoffice 
call include: (1) The transport costs incurred in directing the call 
from the tandem or end office to the office from which the number was 
transferred and back to the tandem or end office; and (2) remote tandem 
or end office switching costs. There is conflicting evidence in the 
record on whether these costs are incurred on a per-minute, per-call, 
or some fixed basis. State commissions in some states have set cost-
based rates for currently available number portability measures. In 
order to do so, states have used different methods of identifying 
costs, including LRIC, TSLRIC, and direct embedded cost studies. In 
California and Illinois, the state commissions set cost-based fixed 
monthly rates for RCF, while in New York and Maryland, the commissions 
set cost-based rates for minutes of use. In addition, there is some 
evidence in the record that carriers incur some non-recurring costs in 
the provision of currently available methods of number portability. 
Several states, such as California, Illinois, and Maryland, have 
permitted the carrier forwarding a number to recover such non-recurring 
costs as a one-time, non-recurring charge.
    130. Section 251(e)(2) of the Communications Act requires that the 
costs of providing number portability be borne by ``all 
telecommunications carriers.'' No party commented on the meaning of the 
term ``all telecommunications carriers.'' Read literally, the statutory 
language ``all telecommunications carriers'' would appear to include 
any provider of telecommunications services. Section 3 of the 
Communications Act defines telecommunications services to mean ``the 
offering of telecommunications for a fee directly to the public, or to 
such classes of users as to be effectively available directly to the 
public, regardless of facilities used.'' Under this reading, states may 
require all telecommunications carriers--including incumbent LECs, new 
LECs, CMRS providers, and IXCs--to share the costs incurred in the 
provision of currently available number portability arrangements. As 
discussed in greater detail below, states may apportion the incremental 
costs of currently available measures among relevant carriers by using 
competitively neutral allocators, such as gross telecommunications 
revenues, number of lines, or number of active telephone numbers.
    131. Section 251(e)(2) of the Act states that the costs of number 
portability are to be ``borne by all telecommunications carriers on a 
competitively neutral basis as determined by the Commission.'' We 
interpret ``on a competitively neutral basis'' to mean that the cost of 
number portability borne by each carrier does not affect significantly 
any carrier's ability to compete with other carriers for customers in 
the marketplace. Congress mandated the use of number portability so 
that customers could change carriers with as little difficulty as 
possible. Our interpretation of ``borne * * * on a competitively 
neutral basis'' reflects the belief that Congress's intent should not 
be thwarted by a cost recovery mechanism that makes it economically 
infeasible for some carriers to utilize number portability when 
competing for customers served by other carriers. Ordinarily the 
Commission follows cost causation principles, under which the purchaser 
of a service would be required to pay at least the incremental cost 
incurred in providing that service. With respect to number portability, 
Congress has directed that we depart from cost causation principles if 
necessary in order to adopt a ``competitively neutral'' standard, 
because number portability is a network function that is required for a 
carrier to compete with the carrier that is already serving a customer. 
Depending on the technology used, to price number portability on a cost 
causative basis could defeat the purpose for which it was mandated. We 
emphasize, however, that this statutory mandate constitutes a rare 
exception to the general principle, long recognized by the Commission, 
that the cost-causer should pay for the costs that he or she incurs.
    132. Our interpretation suggests that a ``competitively neutral'' 
cost recovery mechanism should satisfy the following two criteria. 
First, a ``competitively neutral'' cost recovery mechanism should not 
give one service provider an appreciable, incremental cost advantage 
over another service provider, when competing for a specific 
subscriber. In other words, the recovery mechanism should not have a 
disparate effect on the incremental costs of competing carriers seeking 
to serve the same customer. The cost of number portability borne by a 
facilities-based new entrant that wins a customer away from an 
incumbent LEC is the payment that the new entrant must make to the 
incumbent LEC. The higher this payment, the higher the price the new 
entrant must charge to a customer to serve that customer profitably, 
which will put the new entrant at a competitive disadvantage. We thus 
interpret our first criterion as meaning that the incremental payment 
made by a new entrant for winning a customer that ports his number 
cannot put the new entrant at an appreciable cost disadvantage relative 
to any other carrier that could serve that customer.
    133. An example illustrates the application of this criteria. When 
a facilities-based carrier that competes against an incumbent LEC for a 
customer, the incumbent LEC incurs no cost of number portability if it 
retains the customer. If the facilities-based carrier wins the 
customer, an incremental cost of number portability is generated. The 
share of this incremental cost borne by the new entrant that wins the 
customer cannot be so high as to put it at an appreciable cost 
disadvantage relative to the cost the incumbent LEC would incur if it 
retained the customer. Thus, the incremental payment by the new entrant 
if it wins a customer would have to be close to zero, to approximate 
the incremental number portability cost borne by the incumbent LEC if 
it retains the customer.
    134. A couple of additional examples may further clarify and 
illustrate this criterion. On the one hand, a cost recovery mechanism 
that imposes the entire incremental cost of currently available number 
portability on a facilities-based new entrant would violate this 
criterion. This cost recovery mechanism would impose an incremental 
cost on a facilities-based entrant that neither the incumbent, nor an 
entrant that merely resold the incumbent's service, would have to bear, 
because neither the incumbent nor the reseller would have to use 
currently available number portability measures in order for the 
prospective customer to keep his or her existing number. On the other 
hand, a cost recovery mechanism that recovers the cost of currently 
available number portability through a uniform assessment on the 
revenues of all telecommunications carriers, less any charges paid to 
other carriers, would satisfy this criterion. This approach does not 
disparately affect the

[[Page 38626]]

incremental cost of winning a specific customer or group of customers, 
because a LEC with a small share of the market's revenue would pay a 
percentage of the incremental cost of number portability that will be 
small enough to have no appreciable affect on the new entrant's ability 
to compete for that customer.
    135. The second criterion for a ``competitively neutral'' cost 
recovery mechanism is that it should not have a disparate effect on the 
ability of competing service providers to earn normal returns on their 
investment. If, for example, the total costs of currently available 
number portability are to be divided equally among four competing local 
exchange carriers, including both the incumbent LEC and three new 
entrants, within a specific service area, the new entrant's share of 
the cost may be so large, relative to its expected profits, that the 
entrant would decide not to enter the market. In contrast, recovering 
the costs of currently available number portability from all carriers 
based on each local exchange carrier's relative number of active 
telephone numbers would not violate this criterion, since the amount to 
be recovered from each carrier would increase with the carrier's size, 
measured in terms of active telephone numbers or some other measure of 
carrier size. In addition, allocating currently available number 
portability costs based on active telephone numbers results in 
approximately equal per-customer costs to each carrier. We also believe 
that assessing costs on a per-telephone number basis should give no 
carrier an advantage, relative to its competitors. An alternative 
mechanism that would also satisfy our competitive neutrality 
requirement would be to recover currently available number portability 
costs from all carriers, including local exchange, interexchange, and 
CMRS carriers, based on their relative number of presubscribed 
customers.
    136. We conclude that a variety of approaches currently in use 
today essentially comply with our competitive neutrality criteria. One 
example is the formula voluntarily being used by carriers in Rochester, 
NY, and adopted by the NY DPS in the New York metropolitan area. 
Specifically, this mechanism allocates the incremental costs of 
currently available number portability measures, through an annual 
surcharge assessed by the incumbent LEC from which the number is 
transferred. This surcharge is based on each carrier's number of ported 
telephone numbers relative to the total number of active telephone 
numbers in the local service area. Similarly, as noted above, a cost 
recovery mechanism that allocates number portability costs based on a 
carrier's number of active telephone numbers (or lines) relative to the 
total number of active telephone numbers (or lines) in a service area 
would also satisfy the two criteria for competitive neutrality. As 
noted above, MFS in Illinois plans to seek regulatory approval for a 
similar formula that would allocate the costs of currently available 
measures between it and Ameritech based on each carrier's gross 
telecommunications revenues net of charges to other carriers. A third 
competitively neutral cost recovery mechanism would be to assess a 
uniform percentage assessment on a carrier's gross revenues less 
charges paid to other carriers. Finally, we believe that a mechanism 
that requires each carrier to pay for its own costs of currently 
available number portability measures would also be permissible.
    137. The cost recovery mechanisms described in the preceding 
paragraphs define payments made by new entrants to incumbent LECs for 
providing number portability. We recognize that incumbent LECs must 
make payments to new entrants if the incumbent LEC wins a customer of 
the new entrant that wants to port its number. To be competitively 
neutral, the incumbent LEC would have a reciprocal compensation 
arrangement with each new entrant. That is, the incumbent LEC would pay 
to the new entrant a rate for number portability that was equal to the 
rate that the new entrant pays the incumbent LEC.
    138. In contrast, requiring the new entrants to bear all of the 
costs, measured on the basis of incremental costs of currently 
available number portability methods, would not comply with the 
statutory requirements of section 251(e)(2). Imposing the full 
incremental cost of number portability solely on new entrants would 
contravene the statutory mandate that all carriers share the cost of 
number portability. Moreover, as discussed above, incremental cost-
based charges would not meet the first criterion for ``competitive 
neutrality'' because a new facilities-based carrier would be placed at 
an appreciable, incremental cost disadvantage relative to another 
service provider, when competing for the same customer. Rates for 
interim number portability would also not meet the second criterion if 
they approximate the retail price of local service. New entrants may 
effectively be precluded from entering the local exchange market if 
they are required to bear all the costs of currently available number 
portability measures. Retail rates for call forwarding, to the extent 
they are set above incremental costs, would also not meet the 
principles of competitive neutrality for the same reasons that 
incremental cost-based rates would not. Finally, placing the full cost 
burden of number portability on new entrants would also deter customers 
of incumbent carriers from transferring to a new service provider to 
the extent that the entrant passes on the cost of currently available 
number portability, in the form of higher prices for customers. In 
addition, if incumbent LECs were not required to bear a portion of the 
incremental costs of currently available number portability measures, 
they would have an incentive to delay implementation of a long-term 
number portability method.
    139. A carrier has a number of options for seeking relief if it 
believes that the pricing provisions for number portability offered by 
a LEC violate the statutory standard in section 251(e)(2), the rules we 
set forth in this order, or state-mandated cost recovery mechanisms. 
First, it may bring action against the carrier in federal district 
court pursuant to section 207 for damages or file a section 208 
complaint against another carrier alleging a violation of the Act or 
the Commission's rules. Alternatively, the carrier may file a request 
for declaratory ruling with the Commission, seeking our view on whether 
the statute and our rules have been properly applied. Finally, carriers 
in many instances will be able to pursue existing avenues before their 
state commission if a dispute arises regarding recovery of currently 
available number portability costs.
    140. Finally, in response to questions concerning the appropriate 
treatment of terminating access charges in the interim number 
portability context, we conclude that the meet-point billing 
arrangements between neighboring incumbent LECs provide the appropriate 
model for the proper access billing arrangement for interim number 
portability. We decline to require that all of the terminating 
interstate access charges paid by IXCs on calls forwarded as a result 
of RCF or other comparable number portability measures be paid to the 
competing local service provider. On the other hand, we believe that to 
permit incumbent LECs to retain all terminating access charges would be 
equally inappropriate. Neither the forwarding carrier, nor the 
terminating carrier, provides all the facilities when a call is ported 
to the other carrier. Therefore, we direct forwarding carriers and 
terminating carriers to assess on IXCs charges for terminating access 
through meet-point billing

[[Page 38627]]

arrangements. The overarching principle is that the carriers are to 
share in the access revenues received for a ported call. It is up to 
the carriers whether they each issue a bill for access on a ported 
call, or whether one of them issues a bill to the IXCs covering all of 
the transferred calls and shares the correct portion of the revenues 
with the other carriers involved. If the terminating carrier is unable 
to identify the particular IXC carrying a forwarded call for purposes 
of assessing access charges, the forwarding carrier shall provide the 
terminating carrier with the necessary information to permit the 
terminating carrier to issue a bill. This may include sharing 
percentage interstate usage (PIU) data and may require the terminating 
entity to issue a bill based on allocated interstate minutes per IXC as 
derived from data provided by the forwarding carrier.

G. Number Portability by CMRS Providers

1. Background
    141. In our NPRM, we sought comment and other information on the 
competitive significance of service provider portability for the 
development of competition between CMRS and wireline service providers. 
We also sought comment on the current, and estimated future, demand of 
commercial mobile radio service customers for portable wireless 
telephone numbers when they change their service provider either to 
another CMRS provider or to a wireline service provider. Finally, we 
sought comment on whether the burdens of implementing service provider 
portability (1) between CMRS carriers, and (2) between CMRS and 
wireline carriers are similar to the burdens of implementing service 
provider portability between wireline carriers.
2. Position of the Parties
    142. Parties commenting on CMRS issues generally fall into three 
groups. One group consists of the providers of Personal Communications 
Services (PCS). The PCS providers are just beginning to build advanced 
wireless networks to enter the market. Their successful market entry 
depends largely upon convincing consumers of other commercial mobile 
radio services, e.g., cellular, to switch to PCS. The PCS providers 
therefore want number portability to be implemented as soon as 
technically possible. A second group is composed primarily of cellular 
providers, along with paging and messaging service providers. Parties 
in this category are generally incumbent service providers with 
relatively less sophisticated systems. These parties generally claim 
that number portability is unnecessary in the CMRS marketplace and 
oppose being required to upgrade their networks for such capabilities 
at allegedly great expense. A third group includes parties, such as 
Ameritech and AT&T Wireless, that support implementation of number 
portability by CMRS providers, but on a later deployment schedule than 
wireline portability so as to allow time for technical issues specific 
to CMRS to be resolved.
    143. Authority to Require CMRS Providers To Provide Number 
Portability. SBC Communications argues that CMRS providers have no 
obligation to provide number portability under the 1996 Act, since the 
1996 Act imposes that duty only on LECs, and the definition of LEC 
specifically excludes CMRS providers. As a result, SBC Communications 
claims, the Commission should examine CMRS portability separately from 
wireline portability. Similarly, Bell Atlantic NYNEX Mobile, Arch/
AirTouch Paging, and MobileMedia argue that the 1996 Act and its 
legislative history demonstrate that the number portability obligation 
of section 251(b)(2) was not intended to apply to CMRS providers. 
BellSouth further argues that CMRS providers should not be required to 
offer portability until they compete directly with a LEC. Moreover, 
Bell Atlantic NYNEX Mobile asserts that section 332 of the 
Communications Act only subjects CMRS providers to limited regulation, 
where there is a ``clear cut need'' for doing so.
    144. Importance of Number Portability to CMRS Providers. Most PCS 
providers maintain that number portability is important in the CMRS 
industry because it will promote competition between different types of 
CMRS providers. PCIA supports long-term number portability solutions 
for broadband PCS systems when they are technically feasible, and urges 
the Commission to set a consistent long-term nationwide policy for 
number portability. Omnipoint, a winner of several licenses in the 
broadband PCS C Block auction, explains that the success of PCS entry 
depends on whether PCS providers can attract a significant share of 
embedded cellular customers.
    145. PCIA maintains that number portability is of considerable 
competitive importance to the broadband CMRS market because the 
advantages of portability will be a significant factor in consumers' 
decisions to change providers even though they must endure the 
inconvenience of changing equipment to do so. PCS Primeco claims that 
arguments made by incumbent cellular companies that downplay the 
importance of CMRS number portability are based on the fact that 
current cellular subscribers usually do not make their numbers widely 
known because, under existing cellular pricing plans, subscribers 
typically pay for both inbound and outbound calls. PCS Primeco contends 
that, since cellular and other CMRS customers do not distribute their 
numbers widely, such customers currently may not regard number 
portability as an important factor in deciding whether to switch CMRS 
providers. PCS Primeco asserts that in the future, as CMRS providers 
compete to become a substitute for wireline service, they will not 
assess charges on inbound calls, and CMRS customers will assign the 
same importance to number portability as wireline subscribers do today. 
PCIA argues similarly that portability will facilitate the convergence 
of and competition between CMRS and wireline services, which will 
likely result in cellular customers publishing their telephone numbers. 
PCIA adds that the ability to transfer telephone numbers between 
wireline and CMRS carriers ameliorates ``number exhaustion'' concerns. 
The Illinois Commerce Commission also considers number portability 
between wireline and CMRS providers important.
    146. CTIA maintains that the CMRS industry supports the goal of 
full number portability for all telecommunications providers, including 
CMRS providers, but claims that the Commission should not delay 
implementation of service provider portability in the wireline networks 
while awaiting network solutions for CMRS carriers. Most of the 
commenting cellular providers believe that number portability is not as 
important to CMRS providers as it is to wireline service providers 
because there is little current demand for CMRS number portability and 
because of the unique technical problems involved. AT&T asserts that, 
while number portability is more important in the wireline market than 
the CMRS market, the Commission should not preclude such portability 
for CMRS carriers. Parties opposing CMRS portability generally argue 
that the benefits of CMRS portability are diminished by the following 
factors: (1) Substantial competition already exists in the CMRS market 
since CMRS customers already may choose from multiple competitive 
carriers; (2) CMRS customers place less value on their

[[Page 38628]]

numbers, as indicated by the fact that they do not publish them, do not 
often make them available through directory assistance, and more 
frequently change their telephone numbers due to competition and a 
variety of non-competitive reasons; (3) number portability would impair 
the ability of a carrier to identify immediately the validity of a 
customer's number and thereby prevent fraudulent use of numbers; (4) 
customers will have a disincentive to switch carriers because broadband 
PCS will require equipment that is not compatible with incumbent 
cellular equipment; (5) number portability would adversely affect 
roaming capabilities because cellular carriers rely on the ability to 
identify a roaming cellular customer's ``home carrier'' by the NPA/NXX; 
(6) service provider portability would require CMRS carriers to expand 
significantly the capacity of their roaming databases to provide 
additional information about each subscriber and his or her current 
service provider; and (7) CMRS uses different signalling protocols than 
wireline carriers, which will make implementation of number portability 
more difficult.
    147. Paging providers similarly oppose being required to provide 
number portability. Arch/AirTouch Paging claims that the recent 
proliferation of new area codes, the introduction of a variety of 
competing services, and the availability of 800 and 888 numbers (and 
possibly of portable 500 and 900 numbers) have reduced in general the 
importance of number portability for all carriers. Arch/AirTouch Paging 
further argues against the imposition of number portability on CMRS 
providers because it believes competition will continue to develop 
without number portability. It maintains that various factors, such as 
price, service quality, coverage area, equipment functions, customer 
service, and enhanced service options can overcome the reluctance of 
customers to change carriers. PageNet argues that paging and messaging 
service providers should not be required to provide number portability 
because these services are already competitive, as no single carrier 
controls more than 12 percent of any paging market, and that markets, 
on average, have five competing carriers.
    148. Deployment of Long-Term Solutions by CMRS Carriers. The PCS 
providers generally assert that CMRS providers will face technical 
burdens comparable to wireline carriers in updating their networks, and 
argue that there is no reason to treat CMRS providers differently from 
wireline carriers. Some CMRS parties indicate that it is technically 
possible to update cellular and PCS networks to accommodate long-term 
number portability. PCIA acknowledges that implementation of number 
portability by CMRS providers presents technical difficulties specific 
to CMRS, but argues that such difficulties can be overcome. PCIA 
asserts that most broadband carriers already plan to deploy the 
components necessary to implement LRN (i.e., SS7 signaling, AIN/IN to 
do database queries and responses, and AIN triggers). Omnipoint 
contends that implementation deadlines for number portability should 
apply equally to wireless and wireline carriers, and proposes 
implementation in the top 100 MSAs between October 1997 and October 
1998. Competitive Carriers argues that the Commission's number 
portability rules should be technology-neutral, and favors requiring 
implementation of number portability within 24 months of the issuance 
of our Order throughout the top 100 MSAs.
    149. In contrast, several cellular interests claim that upgrading 
cellular networks to handle number portability will require greater 
time and effort than adapting wireline networks, primarily because 
relatively few cellular networks have IN or AIN capabilities, and 
because the current six-digit-based screening used to validate customer 
information and handle billing will have to be adapted to ten-digit-
based screening. These parties claim that the necessary standards for 
functions such as ten-digit-based screening have yet to be developed.
    150. Several parties caution that implementing number portability 
for CMRS providers will require more time than for wireline service 
providers because to date industry efforts aimed at developing number 
portability have focused on wireline carriers. For example, CMRS 
carriers did not participate in the Illinois number portability 
workshop and CMRS carriers generally have not participated in technical 
trials of number portability. PCIA estimates that it will be four to 
five years before CMRS networks are capable of implementing long-term 
number portability. Similarly, AT&T Wireless argues that CMRS carriers 
must follow a different implementation schedule than wireline.
    151. Interim Number Portability Measures. Many of the CMRS carriers 
oppose requiring CMRS carriers to provide measures such as RCF and DID. 
PCIA and Arch/AirTouch Paging claim that requiring interim measures 
would divert resources from, and thus delay implementation of, a long-
term method. The paging service providers, in particular, oppose 
interim measures as not cost-justified and unnecessary for the already 
competitive paging industry. According to PCIA, RCF and DID currently 
cannot be provided by mobile telephone switching offices and would be 
more problematic and expensive to deploy in a CMRS network than in a 
wireline network. For example, PCIA claims that RCF requires carriers 
to maintain a point of interconnection within each NPA in which it 
intends to provide such service, and that, currently, many broadband 
CMRS carriers' switches do not interconnect at all such points. In 
addition, PCIA asserts that most new broadband carriers are already 
planning to deploy the components necessary to implement a long-term 
database method as part of their initial network designs. Consequently, 
those new broadband carriers might have to spend as much or more to 
upgrade their networks to support interim measures as they would to 
upgrade to support a long-term database method. Because substantial 
resources would have to be devoted to modifying CMRS networks to 
support interim measures, and thus diverted away from modifying CMRS 
networks to support long-term number portability, requiring 
implementation of interim measures now might delay future 
implementation of the long-term method. Other CMRS carriers make claims 
of technical inefficiencies, but acknowledge that RCF and DID are 
technically possible for CMRS providers today.
3. Discussion
    152. Authority to Require CMRS Providers to Provide Number 
Portability. Section 251(b) requires local exchange carriers to provide 
number portability to all telecommunications carriers, and thus to CMRS 
providers as well as wireline service providers. The statute, however, 
explicitly excludes commercial mobile service providers from the 
definition of local exchange carrier, and therefore from the section 
251(b) obligation to provide number portability, unless the Commission 
concludes that they should be included in the definition of local 
exchange carrier. Our recent NPRM on interconnection issues raised by 
the 1996 Act seeks comment on whether, and to what extent, CMRS 
providers should be classified as LECs. Because we conclude that we 
have independent bases of jurisdiction over commercial mobile service 
providers, we need not decide here whether CMRS providers must provide 
number portability as

[[Page 38629]]

local exchange carriers under section 251(b).
    153. We possess independent authority under sections 1, 2, 4(i), 
and 332 of the Communications Act of 1934, as amended, to require CMRS 
providers to provide number portability as we deem appropriate. 
Ensuring that the portability of telephone numbers within the United 
States is handled efficiently and fairly is within our jurisdiction 
under these other provisions of the Communications Act. Sections 2 and 
332(c)(1) of the Act give the Commission authority to regulate 
commercial mobile service providers as common carriers, except for the 
provisions of Title II that we specify are inapplicable. Section 1 of 
the Act requires the Commission to make available to all people of the 
United States ``a rapid, efficient, Nation-wide, and world-wide wire 
and radio communication service.'' The Commission's interest in number 
portability is bolstered by the potential deployment of different 
number portability solutions across the country, which would 
significantly impact the provision of interstate telecommunications 
services. Section 1 also creates a significant federal interest in the 
efficient and uniform treatment of numbering because such a system is 
essential to the efficient delivery of interstate and international 
telecommunications. Implementation of long-term service provider 
portability by CMRS carriers will have an impact on the efficient use 
and uniform administration of the numbering resource. Section 4(i) 
grants the Commission authority to ``perform any and all acts, make 
such rules and regulations, and issue such orders, not inconsistent 
with [the Communications Act of 1934, as amended], as may be necessary 
in the execution of its functions.'' We conclude that the public 
interest is served by requiring the provision of number portability by 
CMRS providers because number portability will promote competition 
between providers of local telephone services and thereby promote 
competition between providers of interstate access services.
    154. Bell Atlantic NYNEX Mobile cites the CT DPUC Petition in 
support of its argument that the Commission can only regulate CMRS 
providers under section 332 to the extent clearly necessary, and that 
regulation of number portability is not clearly necessary in the CMRS 
market. We conclude, however, that the CT DPUC Petition does not limit 
our authority to require CMRS providers to provide number portability 
to other CMRS or wireline carriers because that proceeding did not 
address the Commission's authority to require CMRS providers to provide 
number portability. That proceeding related solely to state authority 
to regulate rates of CMRS providers. We believe that imposing number 
portability obligations on CMRS providers will foster increased 
competition in the CMRS marketplace, and furthers our CMRS regulatory 
policy of establishing moderate, symmetrical regulation of all 
services, and a preference for curing market imperfections by lowering 
barriers to entry in order to encourage competition.
    155. Importance of Number Portability to CMRS Providers. We require 
cellular, broadband PCS, and covered specialized mobile radio (SMR) 
providers (as defined in the First Report and Order in CC Docket 94-
54), which are the CMRS providers that are expected to compete in the 
local exchange market, to offer number portability. This mandate is in 
the public interest because it will promote competition among cellular, 
broadband PCS, and covered SMR carriers, as well as among CMRS and 
wireline providers. We therefore include those carriers in our mandate 
to provide long-term service provider portability, under the 
Commission-mandated performance criteria set forth above, pursuant to 
our authority under sections 1, 2, 4(i), and 332 of the Communications 
Act of 1934. This mandate applies when switching among wireline service 
providers and broadband CMRS providers, as well as among broadband CMRS 
providers, even if the broadband CMRS and wireline service providers or 
the two broadband CMRS providers are affiliated. We base this 
conclusion on our view, as discussed in the following paragraphs, that 
cellular, broadband PCS, and covered SMR providers will compete 
directly with one another, and potentially will compete in the future 
with wireline carriers.
    156. We specifically exclude at this time paging and other 
messaging services, and the following CMRS providers as listed in part 
20 of our rules: Private Paging, Business Radio Services, Land Mobile 
Systems on 220-222 MHz, Public Coast Stations, Public Land Mobile 
Service, 800 MHz Air-Ground Radio-Telephone Service, Offshore Radio 
Service, Mobile Satellite Services, Narrowband PCS Services. We do so 
because such services currently will have little competitive impact on 
competition between providers of wireless telephony service or between 
wireless and wireline carriers. Because local SMR licensees offering 
mainly dispatch services to specialized customers in a non-cellular 
system configuration do not compete substantially with cellular and 
broadband PCS providers, we also exclude them from the number 
portability requirements we adopt today. For similar reasons, we also 
specifically exclude at this time Local Multipoint Distribution Service 
(LMDS). If, however, any of these services begins to compete in the 
local exchange market, or if there are other public interest reasons to 
require them to provide number portability, we will reassess the 
exclusion of these services from the requirement to provide number 
portability.
    157. Service provider portability between cellular, broadband PCS, 
and covered SMR providers is important because customers of those 
carriers, like customers of wireline providers, cannot now change 
carriers without also changing their telephone numbers. While we 
recognize that customers may need to purchase new equipment when 
switching among such CMRS providers, the inability of customers to keep 
their telephone numbers when switching carriers also hinders the 
successful entrance of new service providers into the cellular, 
broadband PCS, and SMR markets. We believe, therefore, that service 
provider portability, by eliminating one major disincentive to switch 
carriers, will ameliorate customers' disincentive to switch carriers if 
they must purchase new equipment. We believe service provider 
portability will promote competition between existing cellular 
carriers, as well as facilitate the viable entry of new providers of 
innovative service offerings, such as PCS and covered SMR providers.
    158. With the recent and expected future entry of new PCS 
providers, and the growth of existing CMRS generally, we believe it 
important that service provider portability for cellular, broadband 
PCS, and covered SMR providers be made available so as to remove 
barriers to competition among such providers. Removing barriers, such 
as the requirement of changing telephone numbers when changing 
providers, will likely stimulate the development of new services and 
technologies, and create incentives for carriers to lower prices and 
costs. We find unpersuasive arguments that number portability is 
unimportant because the CMRS market is already substantially 
competitive since CMRS customers already may choose from multiple 
competitive carriers. Most CMRS customers today subscribe to cellular 
service because broadband PCS has been offered for a very short time,

[[Page 38630]]

SMR service has typically been used for communications among mobile 
units of the same business subscriber (e.g., taxi dispatch), and mobile 
satellite services have typically been used only in rural areas. The 
possibility of entry by new competitors can constrain monopolistic, or 
in this case, duopolistic, conduct by incumbent providers and thus 
serve the public interest by potentially lowering prices, improving 
service quality, and encouraging innovation. We note that while the 
cellular industry, with two facilities-based carriers offering service 
in each market area, is more competitive than traditional monopoly 
telephone markets, it is far from perfectly competitive. The United 
States Government Accounting Office, the Department of Justice, and the 
Commission have determined that only limited competition currently 
exists in the cellular market.
    159. We conclude that number portability will facilitate the entry 
of new service providers, such as PCS and covered SMR providers, into 
CMRS markets currently dominated by cellular carriers, and thus provide 
incentives for incumbent cellular carriers to lower prices and increase 
service choice and quality. Indeed, we noted recently that competition 
from PCS, alone, is expected to reduce cellular prices by as much as 40 
percent over the next two years. We believe that such pro-competitive 
effects will be enhanced by eliminating the need for customers to 
change telephone numbers when switching providers of cellular services, 
broadband PCS, and covered SMR services.
    160. We further conclude that number portability will promote 
competition between CMRS and wireline service providers as CMRS 
providers offer comparable local exchange and fixed commercial mobile 
radio services. The Commission has recognized on several occasions that 
CMRS providers, such as broadband PCS and cellular, will compete in the 
local exchange marketplace. For example, the Commission permitted 
Southwestern Bell Mobile Systems, Inc. to own local exchange facilities 
outside of Southwestern Bell's service area in order to ``promote 
significant Commission objectives by encouraging local loop 
competition. The development of CMRS is one of several potential 
sources of competition that we have identified to bring market forces 
to bear on the existing LECs.'' The Commission also adopted an auction 
licensing mechanism to speed deployment of PCS and thereby ``create 
competition for existing wireline and wireless services.'' In addition, 
the Commission decided to permit foreign investment in Sprint 
Corporation based, in part, on a finding that a portion of that 
investment would be used to fund PCS competition with wireline local 
exchange providers in the U.S. market. Finally, in the Fixed CMRS 
Notice (61 FR 6189 (February 16, 1996)), the Commission tentatively 
concluded that PCS and cellular providers will provide fixed CMRS local 
loop services, and that such carriers will directly compete with 
traditional wireline local exchange carriers. We believe, for the 
reasons stated above, that service provider portability will encourage 
CMRS-wireline competition, creating incentives for carriers to reduce 
prices for telecommunications services and to invest in innovative 
technologies, and enhancing flexibility for users of telecommunications 
services.
    161. We find unpersuasive commenters' arguments that number 
portability is not a competitive issue for CMRS providers because 
consumers are not interested in retaining their CMRS numbers. We 
recognize that currently customers of cellular, broadband PCS, and 
covered SMR providers may generally initiate more calls than they 
receive, and are reluctant to distribute their CMRS telephone numbers. 
We agree with the argument advanced by PCS Primeco that this reluctance 
generally is caused by the current cellular carrier pricing structures, 
under which customers pay for incoming calls, rather than lack of 
attachment to CMRS telephone numbers. Several parties have indicated 
that at least some CMRS providers intend to compete with wireline 
carriers in the local exchange market. To do so effectively, CMRS 
carriers are likely to change their pricing structures to resemble more 
closely wireline pricing structures. As broadband CMRS pricing 
structures are modified as a likely result of increased competition, 
and cellular, broadband PCS, and covered SMR become integrated and less 
functionally distinguishable from wireline services, customers may be 
more likely to make their CMRS telephone numbers known, and utilize 
numbering resources in a manner more comparable with that of the 
current wireline market. We, therefore, conclude that requiring number 
portability for cellular, broadband PCS, and covered SMR providers will 
enhance the development of competition among those providers and among 
CMRS and wireline service providers.
    162. Deployment of Long-Term Solutions by CMRS Carriers. The record 
of this proceeding suggests that cellular, broadband PCS, and covered 
SMR providers will face burdens comparable to wireline carriers in 
modifying their networks to implement number portability, and that any 
technical issues that are unique to those carriers can be resolved. 
While a number of parties have raised CMRS-specific issues that must be 
resolved before CMRS carriers can effectively provide number 
portability, we conclude that the record demonstrates that none of 
these difficulties are insurmountable. Several parties claim that CMRS 
networks can be updated to accommodate long-term number portability. In 
addition, the report on number portability recently released by the INC 
indicates that broadband CMRS roaming systems, including mobile station 
registration and call delivery, switches, protocols, and wireline 
interconnection arrangements can be updated to accommodate number 
portability. PCIA asserts that most broadband carriers already plan to 
deploy the components necessary to implement LRN (i.e., SS7 signaling, 
IN/AIN to do database queries and responses, and AIN triggers). 
Omnipoint argues that the cellular industry has failed to demonstrate 
why CMRS-specific technical issues cannot be worked out within the same 
time as wireline technical issues.
    163. A number of commenters, however, also suggest that 
implementation of service provider portability for broadband CMRS would 
necessitate more time than deployment of wireline methods. For 
instance, several cellular interests claim that upgrading cellular 
networks to handle number portability will require greater time and 
effort than adapting wireline networks, primarily because relatively 
few cellular networks have IN or AIN capabilities, and because the 
current six-digit-based screening used to provide roaming, validate 
customer information, and handle billing will have to be adapted to 
ten-digit-based screening. These parties claim that the necessary 
standards for functions such as ten-digit-based screening have yet to 
be developed.
    164. It appears that while the wireline industry has already 
developed many of the standards and protocols necessary for wireline 
carriers to provide number portability, the CMRS industry is only 
beginning to address the additional standards and protocols specific to 
the provision of portability by CMRS carriers. The technical 
requirements for broadband CMRS portability have been given 
comparatively little attention compared to those for wireline. Initial 
state efforts have generally not addressed CMRS issues; for example, 
the Illinois Number Portability

[[Page 38631]]

Workshop, which began studying wireline portability in April 1995, only 
plans to begin addressing CMRS portability in July 1996. Moreover, 
cellular, broadband PCS, and covered SMR providers face technical 
burdens unique to the provision of seamless roaming on their networks, 
and standards and protocols will have to be developed to overcome these 
difficulties. Therefore, based on the record, and the technical 
evidence presented both by the parties in this proceeding and the INC 
Report, we conclude that cellular, broadband PCS, and covered SMR 
providers should implement long-term service provider portability based 
on the following schedule.
    165. We require all cellular, broadband PCS, and covered SMR 
carriers to have the capability of querying appropriate number 
portability database systems in order to deliver calls from their 
networks to ported numbers anywhere in the country by December 31, 
1998, the date by which wireline carriers must complete implementation 
of number portability in the largest 100 MSAs. This schedule will 
ensure that cellular, broadband PCS, and covered SMR providers will 
have the ability to route calls from their customers to a wireline 
customer who has ported his or her number, by the time a substantial 
number of wireline customers have the ability to port their numbers 
between wireline carriers. This capability to access a database for 
routing information can be accomplished in either of two ways. First, 
the carrier may implement hardware and software upgrades (e.g., IN/AIN 
capabilities) similar to those needed in wireline networks. Since these 
upgrades do not require development of the standards and protocols 
necessary to support roaming, we believe that cellular, broadband PCS, 
and covered SMR carriers should be able to complete these upgrades by 
the date by which wireline carriers must complete implementation of 
number portability in the largest 100 MSAs. Second, the carrier may 
make arrangements with other carriers that are capable of performing 
database queries. Cellular, broadband PCS, and covered SMR carriers 
operating in areas outside the largest 100 MSAs thus would need to make 
arrangements with other CMRS providers that have the capability to 
query databases, or with wireline carriers in the largest 100 MSAs, 
which will have completed deployment of number portability by December 
31, 1998.
    166. We require all cellular, broadband PCS, and covered SMR 
carriers to offer service provider portability throughout their 
networks, including the ability to support roaming, by June 30, 1999. 
The record indicates that additional time is needed to develop 
standards and protocols, such as ten-digit-based screening, to overcome 
the technical burdens unique to the provision of seamless roaming on 
cellular, broadband PCS, and covered SMR networks. Individual carriers, 
of course, may implement number portability sooner, and we expect that 
some carriers will do so based on individual technical, economic, and 
marketing considerations. We believe a nationwide implementation date 
for number portability for cellular, broadband PCS, and covered SMR 
providers is necessary to ensure that validation necessary for roaming 
can be maintained. We delegate authority to the Chief, Wireless 
Telecommunications Bureau, to establish reporting requirements in order 
to monitor the progress of cellular, broadband PCS, and covered SMR 
providers implementing number portability, and to direct such carriers 
to take any actions necessary to ensure compliance with this deployment 
schedule. We believe it necessary to establish reporting requirements 
for CMRS to ensure timely resolution of the standards issues unique to 
CMRS number portability, particularly roaming.
    167. We recognize, however, that additional technical issues may 
arise as the industry begins to focus on provision of portability by 
CMRS carriers. We therefore delegate authority to the Chief, Wireless 
Telecommunications Bureau, to waive or stay any of the dates in the 
implementation schedule, as the Chief determines is necessary to ensure 
the efficient development of number portability, for a period not to 
exceed 9 months (i.e., no later than September 30, 1999, for the first 
deadline, and no later than March 31, 2000, for the second deadline).
    168. In the event a carrier is unable to meet our deadlines for 
implementing a long-term number portability solution, it may file with 
the Commission at least 60 days in advance of the deadline a petition 
to extend the time by which implementation in its network will be 
completed. We emphasize, however, that carriers are expected to meet 
the prescribed deadlines, and a carrier seeking relief must present 
extraordinary circumstances beyond its control in order to obtain an 
extension of time. Carriers seeking such relief must demonstrate 
through substantial, credible evidence the basis for its contention 
that it is unable to comply with our deployment schedule. Such requests 
must set forth: (1) The facts that demonstrate why the carrier is 
unable to meet our deployment schedule; (2) a detailed explanation of 
the activities that the carrier has undertaken to meet the 
implementation schedule prior to requesting an extension of time; (3) 
an identification of the particular switches for which the extension is 
requested; (4) the time within which the carrier will complete 
deployment in the affected switches; and (5) a proposed schedule with 
milestones for meeting the deployment date.
    169. Interim Number Portability Measures. We do not require CMRS 
providers to provide RCF, DID, or comparable measures. Different 
treatment of CMRS and wireline carriers in this instance is justified 
by their differing circumstances. According to the record, RCF and DID 
currently cannot be provided by mobile telephone switching offices. Due 
to the different nature of CMRS networks and wireline networks, 
implementation of RCF or DID capability in a CMRS network appears far 
more problematic and expensive than in a wireline network. For example, 
PCIA claims that RCF requires carriers to maintain a point of 
interconnection within each NPA in which it intends to provide such 
service, and that currently, many broadband CMRS carriers' switches do 
not interconnect at all such points. Moreover, cellular roaming systems 
would have to be modified to account for the fact that, under RCF, a 
number different than the one dialed is used to route the call. As a 
result, alternative means will have to be developed to enable CMRS 
carriers to validate mobile subscribers who have roamed out of their 
service areas. Broadband carriers may also have to purchase new 
switches in order to provide RCF and DID. Moreover, most new broadband 
carriers are already planning to deploy the components necessary to 
implement a long-term database method as part of their initial network 
designs. Consequently, those new broadband carriers might have to spend 
as much or more to upgrade their networks to support interim measures 
as they would spend to upgrade to support a long-term database method, 
and requiring implementation of both might delay implementation of the 
long-term method. We also find it significant that, while the wireline 
parties advocating full portability generally support interim measures, 
the CMRS parties advocating full portability generally oppose interim 
measures.
    170. We therefore conclude that it would be counterproductive to 
require

[[Page 38632]]

CMRS carriers to provide interim measures since they can provide long-
term portability comporting with our standards just as quickly and less 
expensively. We believe that relieving cellular, broadband PCS, and 
covered SMR carriers of the burden of providing interim measures will 
allow them to devote their full resources toward implementing a long-
term method and thus enhance their ability to provide long-term 
portability on the same schedule as wireline carriers. We note that 
CMRS carriers are, of course, free to provide interim number 
portability, if they choose to do so.
    171. Number Transferability. A few parties raise the issue of 
number transferability, the ability of a reseller to transfer telephone 
numbers from one facilities-based carrier to another in order to permit 
the reseller's end user customers to retain their existing telephone 
numbers. Because the record does not establish any relationship between 
number transferability and number portability, and does not identify 
the technical issues involved in providing number transferability, we 
decline to address the provision of number transferability in this 
proceeding. We note that this issue has been raised in the Second CMRS 
Interconnection NPRM (60 FR 20949 (April 28, 1996)), and will be 
addressed in CC Docket No. 94-54.
    H. Service and Location Portability
1. Background
    172. While service provider portability refers to the ability of 
end users to retain the same telephone numbers as they change from one 
service provider to another, service portability refers to the ability 
of users of telecommunications services to retain existing 
telecommunications numbers without impairment of quality, reliability, 
or convenience when switching from one telecommunications service to 
another service provided by the same telecommunications carrier. We 
regard switching among wireline service providers and broadband CMRS 
providers, or among broadband CMRS providers, as changing service 
providers, not changing services, even if the broadband CMRS and 
wireline service providers or the two broadband CMRS providers are 
affiliated. We base this conclusion on our view that CMRS providers, 
such as cellular, broadband PCS, and covered SMR providers, compete 
directly with one another, and broadband CMRS providers potentially 
will compete in the future with wireline carriers.
    173. Today, telephone subscribers must change their telephone 
number when they change telephone service (e.g., from Plain Old 
Telephone Services (POTS) to Integrated Services Digital Network 
(ISDN)) because a particular service may be available only through a 
particular switch. In our NPRM, we sought comment on the demand for 
service portability and the extent to which a lack of service 
portability inhibits the growth of new services, such as ISDN. We 
requested information on the relative importance of service portability 
to the decisions of end users when considering whether to switch from 
one service to another. We also sought comment on what public interest 
objectives would be served by encouraging (or possibly mandating) 
implementation of service portability, and how the Commission could 
encourage service portability.
    174. Location portability refers to the ability of users of 
telecommunications services to retain existing telecommunications 
numbers without impairment of quality, reliability, or convenience when 
moving from one physical location to another. Today, telephone 
subscribers must change their telephone numbers when they move outside 
the area served by their current central office. In our NPRM, we sought 
comment on the demand for location portability and the geographic area 
in which portability might be desired by consumers. We asked what 
federal policy objectives would be served by encouraging (or possibly 
mandating) implementation of location portability, and how such 
objectives could be attained. We sought comment on the potential impact 
that location portability for wireline telephone numbers and the 
development of the 500 personal communications services market, which 
permits customers to be reached through a single telephone number 
regardless of their location, may have on each other.
2. Position of the Parties
    175. Most parties agree that location portability and service 
portability do not have the same potential impact on consumer choice 
and on the development of local competition as service provider 
portability. Pacific Bell and the Missouri PSC argue that the 
availability of service portability will be driven by market forces, 
and that product differentiation will stimulate customers to change 
their telecommunications services. Ameritech and SBC Communications 
note that since the 1996 Act addresses only service provider 
portability, the Commission should not adopt rules mandating service 
and location portability. OPASTCO claims that requiring service 
portability would strain the limited abilities of small LECs, and thus 
delay deployment of rural infrastructure. The Missouri PSC and New York 
DPS argue that there currently is not enough demand for ISDN to warrant 
requiring service portability. The Florida PSC, on the other hand, 
maintains that, in many cases, service portability is already 
available, as long as the switch has the needed functionality.
    176. Most parties agree that implementation of location portability 
poses many problems, including: (1) Loss of geographic identity of 
one's telephone number; (2) lack of industry consensus as to the proper 
geographic scope of location portability; (3) substantial modification 
of billing systems and the consumer confusion regarding charges for 
calls; (4) loss of the ability to use 7-digit dialing schemes; (5) the 
need to restructure directory assistance and operator services; (6) 
coordination of number assignments for both customer and network 
identification; (7) network and switching modifications to handle a 
two-tiered numbering system; (8) development and implementation of 
systems to replace 1+ as toll identification; and (9) possible adverse 
impact on E911 services.
    177. Several BOCs maintain that the Commission should require 
location portability immediately because currently new entrants can 
serve larger geographic areas with a single switch. Some of these 
parties maintain that the ability of competing carriers to serve larger 
geographic areas from a single wire center may increase consumer demand 
for location portability, thus giving competing carriers an advantage 
over incumbent LECs. MCI, SBC Communications, Nextel, and Arch/AirTouch 
Paging argue that, if location portability is implemented, it should be 
limited to the local calling area of a wireline carrier. MCI further 
maintains that allowing numbers to be transferred across NPA or state 
boundaries would negatively affect the numbering resource because 
individuals could remove numbers from the NPA by taking such numbers to 
other areas of the country. In contrast, GSA believes that the greater 
the geographic scope of location portability, the more meaningful the 
consumer benefits.
    178. While many parties believe location portability has some 
value, most parties maintain that its implementation should not delay 
implementation of service provider portability. At the same time, 
numerous parties, including incumbents, new entrants, and state 
commissions, argue

[[Page 38633]]

that any number portability method adopted by the Commission should be 
capable of expanding to encompass location portability if such demand 
arises. GSA, Nortel, and Bell Atlantic argue that a long-term 
portability method should eventually encompass service and location 
portability. The National Emergency Numbering Association (NENA) 
contends the statutory definition of ``number portability'' in its 
broadest interpretation would limit any requirement to provide location 
portability to the area served by the same central office.
    179. Pacific Bell and Time Warner Holdings argue that market forces 
should drive the development of location portability. Florida PSC, 
Missouri PSC, ACTA, Pacific Bell, BellSouth, and Sprint maintain that 
current market demand for location portability is mixed, and depends on 
such factors as the geographic scope of location portability and costs 
of implementation. GSA, on the other hand, claims that demand for 
location portability is reflected in the increase in demand for 800 
services and by the demand for 500 services. A number of wireless 
parties argue that wireless carriers already provide significant 
location portability. Finally, the New York DPS maintains that location 
portability, if limited to a rate center, will avoid the problems of 
customer confusion, and that the 1996 Act does not prohibit provision 
of location portability within that limitation.
    180. OPASTCO, SBC Communications, and Nextel argue that location 
portability should only be provided through use of non-geographic 
numbers, such as 500 services. GTE argues that its survey illustrates 
that customers are not adverse to a one-time number change to a non-
geographic number in order to have number portability. Florida PSC 
maintains, however, that location portability and 500 services serve 
different purposes, with location portability providing the ability to 
take a phone number when a customer changes premises, and 500 services 
providing the ability to take a telephone number to different locations 
during the day, week, or month.
3. Discussion
    181. We decline at this time to require LECs to provide either 
service or location portability. This decision is not inconsistent with 
the 1996 Act, which mandates the provision of service provider 
portability, but does not address explicitly service or location 
portability. The 1996 Act's requirement to provide number portability 
is limited to situations when users remain ``at the same location,'' 
and ``switch[ ] from one telecommunications carrier to another,'' and 
thus does not include service and location portability.
    182. While the 1996 Act does not require LECs to offer service and 
location portability, it does not preclude this Commission from 
mandating provision of these features if it would be in the public 
interest, nor does it prevent carriers from providing service and 
location portability, consistent with this Order, if they so choose. We 
believe, however, that requiring service or location portability now 
would not be in the public interest. As the record indicates, service 
provider portability is critical to the development of competition, but 
service and location portability have not been demonstrated to be as 
important to the development of competition.
    183. Consistent with the result advocated by most parties 
commenting on this issue, we believe that a mandate for service 
portability is unnecessary for several reasons. First, and most 
importantly, requiring carriers to make the necessary switch and 
network modifications to accommodate service portability as well as 
service provider portability may delay implementation of the latter. 
Second, consumer demand for service portability is unclear. The record 
indicates that the benefits of service portability are limited because 
the current unavailability of this capability affects only customers 
who wish to change their current service to Centrex and ISDN services 
or vice versa. Since most non-basic services offered by incumbent LECs 
are purchased in addition to (not in lieu of) basic services, 
implementation of service portability may actually lower demand for the 
alternate services if it raises their prices. Third, our requirement to 
provide service provider portability does not preclude carriers from 
offering service portability where they perceive a demand for it. In 
fact, our mandate will likely facilitate carriers' ability to provide 
service portability. Service provider portability will naturally drive 
the provision of service portability because if a user can receive a 
different service and keep the same number simply by switching 
carriers, service providers will have an incentive to offer service 
portability to keep those customers. Finally, carrier attempts to 
differentiate their products from those of other carriers will 
stimulate changes in services by customers, regardless of service 
portability.
    184. We also believe that, at this time, the disadvantages of 
mandating location portability outweigh the benefits. Our chief concern 
is that users currently associate area codes with geographic areas and 
assume that the charges they incur will be in accordance with the 
calling rates to that area. Location portability would create consumer 
confusion and result in consumers inadvertently making, and being 
billed for, toll calls. Consumers would be forced to dial ten, rather 
than seven, digits to place local calls to locations beyond existing 
rate centers. In order to avoid this customer confusion, carriers, and 
ultimately consumers, would incur the additional costs of modifying 
carriers' billing systems, replacing 1+ as a toll indicator, and 
increasing the burden on directory, operator, and emergency services to 
accommodate 10-digit dialing and the loss of geographic identity.
    185. In addition to the disadvantages, the demand for location 
portability is currently unclear. There is no consensus on the 
preferred geographic scope of location portability. Also, users who 
strongly desire location portability can use non-geographic numbers by 
subscribing to a 500 or toll free number. Finally, whereas having to 
change numbers deters users from switching service providers, we 
believe that a customer's decision to move to a new residential or 
business location generally would not be influenced significantly by 
the availability of number portability. Therefore, location portability 
will not foster the development of competition to the same extent as 
service provider portability.
    186. We recognize that new entrants will be able to offer a greater 
range of location portability per switch due to their network 
architecture and because they will generally have fewer customers in 
the area covered by a switch. To avoid the consumer confusion and other 
disadvantages inherent in requiring location portability, however, we 
believe state regulatory bodies should determine, consistent with this 
Order, whether to require carriers to provide location portability. We 
believe the states should address this issue because we recognize that 
``rate centers'' and local calling areas have been created by 
individual state commissions, and may vary from state to state. To the 
extent rate centers and/or local calling areas vary from state to 
state, the degree of location portability possible without causing 
consumer confusion may also vary. We therefore expect state regulatory 
bodies to consider the particular circumstances in their respective 
locales in determining whether to require carriers to implement 
location portability.

[[Page 38634]]

    187. We recognize that location portability would promote consumer 
flexibility and mobility and potentially promote competition by 
allowing carriers to offer different levels of location portability in 
a competitive manner. Also, the importance that consumers attribute to 
the geographic identity of their telephone numbers may change, and our 
concerns regarding customer confusion may no longer hold true. For 
these reasons, we require any long-term method to have the capability 
of accommodating location and service portability if, in the future, 
demand increases or the burdens decrease.

I. 500 and 900 Number Portability

1. Background
    188. Currently, consumers can purchase 500 or 900 services from 
either local exchange or interexchange carriers. A consumer subscribing 
to 500 service receives a 500 ``area code'' number that can be 
programmed to deliver calls wherever the consumer travels in the United 
States and in many locations around the world. 900 service is a calling 
service providing businesses with a method to deliver information, 
advice, or consultations quickly and conveniently by telephone. 
Individuals calling 500 or 900 subscribers dial 500 or 900 plus a 7-
digit number (NXX-XXXX). When a call is placed to a 500 or 900 service 
telephone number, the originating LEC uses the NXX of the dialed number 
to identify the carrier serving either the owner of the 500 number, or 
the business operating the 900 number service. The LEC then routes the 
call over the appropriate carrier's network.
    189. In the NPRM, we tentatively concluded that service provider 
portability for 500 and 900 numbers is beneficial for customers of 
those services. We sought comment on this tentative conclusion and on 
the costs (monetary and nonmonetary) of making such portability 
available. With respect to 500 service provider portability, we sought 
comment on the estimated costs of deploying and operating a database 
solution, and whether it would be technically feasible to upgrade the 
existing 800 database and associated software to accommodate PCS N00 
numbers. We also sought comment on whether it is feasible (both 
technically and economically) to provide PCS N00 service provider 
portability in a switch-based translation environment. Further, we 
sought comment on the following issues raised by the Industry Numbering 
Committee's (INC's) PCS N00 report: (1) Who would be the owner/operator 
of an SMS administering a PCS N00 database; (2) how would that 
administrator be selected; (3) how would the costs of providing PCS N00 
portability be recovered; and (4) by what date should PCS N00 
portability be deployed. Finally, we sought comment on the ability of 
900 number portability to lower prices and stimulate demand for 900 
services, and on the costs of deploying and operating the necessary 
database.
2. Positions of the Parties
    190. In comments filed prior to passage of the 1996 Act, a majority 
of parties argue that consideration of 500 and 900 number portability 
is premature, as the current costs of implementation outweigh any 
benefits. Indeed, several LECs maintain that the Commission should 
establish a separate docket to address the unique issues raised by 500 
and 900 service provider portability.
    191. In contrast, MCI, Citizens Utilities, Competitive Carriers, 
Florida Public Service Commission, and some CMRS providers contend that 
500 and 900 number portability would benefit consumers, and that 
service provider portability for 500 and 900 numbers should be 
developed, as long as the costs are not prohibitive. The information 
service providers generally agree that 900 portability should be 
mandated by the Commission as soon as possible to increase competition 
for information service provider traffic among IXCs, and to offer a 
more efficient and broader range of information services.
    192. Interactive Services, MCI, and Teleservices maintain that the 
toll free database can be modified to include 900 numbers at relatively 
modest cost, and that the implementation and administration of toll 
free number portability would provide a model for 500 and 900 number 
portability. Both Interactive Services and MCI note that parties have 
failed to provide relevant cost and benefit data in the record of this 
proceeding, and urge the Commission to require parties to submit data 
concerning the total costs of implementation and operation.
    193. Ameritech states that updating the existing toll free platform 
to support 900 numbers is technically possible, but would require 
extensive systems modifications. Ameritech also states that it would be 
technically and economically infeasible to provide PCS N00 portability 
in a switch-based translation environment due to the memory capacity 
limitations and the operational issues associated with updating the 
routing tables. Bell Atlantic states that it may be technically 
feasible to upgrade the existing toll free database to accommodate 500 
and 900 numbers, but this would require extensive system changes. NYNEX 
supports implementation of service provider portability for 500 numbers 
as proposed in the INC Report on PCS N00 Portability, which sets forth 
a four-year implementation schedule. USTA argues that 500 number 
portability can best be provided through a national, centralized 
database, similar to the toll free database, and notes that a 900 
number portability solution may not be able to utilize the same 
platform as that contemplated for 500 number portability because of the 
differing structures of the services associated with 900 number 
services.
    194. Only two parties addressed the issue of 500 or 900 portability 
in comments filed after passage of the 1996 Act. Interactive Services 
asserts that the 1996 Act requires LECs to provide service provider 
portability for 900 numbers when technically feasible, and that the 
record in this proceeding demonstrates that long-term service provider 
portability for 900 numbers is technically feasible. Interactive 
Services did not comment on whether service provider portability for 
500 numbers is technically feasible. BellSouth states that the 1996 Act 
is silent with respect to the portability of non-geographic numbers.
3. Discussion
    195. Section 251(b)(2) of the 1996 Act requires all LECs ``to 
provide, to the extent technically feasible, number portability in 
accordance with requirements prescribed by the Commission.'' Section 3, 
in turn, defines number portability as ``the ability of users of 
telecommunications services to retain, at the same location, existing 
telephone numbers * * * when switching from one telecommunications 
carrier to another.''
    196. While both LECs and interexchange carriers are able to provide 
500 and 900 services, such services are more frequently provided by 
IXCs. LECs, to date, have offered relatively few 500 and 900 services 
because the Bell Operating Companies, which serve over 76 percent of 
the nation's access lines, were precluded from offering interLATA 
services under the Modification of Final Judgment, and therefore could 
offer 500 and 900 services only on an intraLATA basis. Conversely, 500 
and 900 interLATA services, which account for most of the 500 and 900 
numbers, have, up until now, been exclusively provided by IXCs. Thus, 
most users of 500 and 900

[[Page 38635]]

services obtain their numbers from IXCs, and not from LECs.
    197. Although the statute does not define specifically the numbers 
that must be portable, the statute on its face imposes an obligation to 
provide number portability only on LECs. Because the statute's 
directive to provide number portability applies only to LECs, IXCs are 
not obligated under the 1996 Act to participate in making their numbers 
portable when their customers wish to move their numbers to another IXC 
or any other carrier offering 500 or 900 service. In the case of 900 
service, the ``user'' of the telecommunications service that wants to 
keep its number when switching carriers is the business that is 
offering a 900 service, not the end user that is purchasing the 
information service from the 900 service provider. A 900 service 
provider typically purchases transport from an IXC and uses a 900 
number assigned to that IXC to offer its service. As a consequence, if 
a 900 service provider wishes to retain its number when switching from 
one carrier to another, the IXC (and not the LEC that provides exchange 
access to the IXC) is the party that would have to release the 
management of the number in question. Likewise, 500 service today is 
offered exclusively by IXCs, which have blocks of 500 numbers assigned 
to them for this purpose. When a 500 customer wishes to switch from one 
carrier to another, the IXC providing the 500 service (and not the LEC 
that provides exchange access to the 500 service provider) would have 
to relinquish the number in question to the competing carrier. Thus, as 
a practical matter, portability for the vast majority of 500 and 900 
numbers can occur only if the IXC releases to the new carrier 
management of the assigned 500 or 900 number that is to be ported.
    198. We recognize, however, that LECs increasingly may offer 500 
and 900 services themselves in the future. To the extent they do, we 
conclude that those LECs would be obligated under the 1996 Act to offer 
number portability for their own 500 and 900 numbers to the extent 
``technically feasible.'' We believe we have insufficient evidence in 
this record to determine whether it is technically feasible for LECs to 
provide portability for their own 500 and 900 numbers. Neither the INC 
nor state number portability task forces have addressed the issue of 
500 and 900 number portability. The record developed on this issue 
largely predates passage of the 1996 Act, and as a consequence, few 
parties have focused on this issue. No party to this proceeding has 
suggested that any of the currently available methods, such as RCF or 
DID, or any of the long term methods currently under consideration, 
such as LRN, could be used to provide portability for non-geographic 
numbers. Instead, the parties that addressed this issue suggest that 
the current toll free database potentially could be modified to 
accommodate 500 and 900 numbers, but note that a host of major 
technical issues would need to be resolved. The only party to this 
proceeding that argues that the Commission is required under the 1996 
Act to mandate service provider portability for 900 numbers, 
Interactive Services, fails to address the fact that the statutory 
obligation to offer number portability falls only on LECs, and not on 
other carriers that offer 900 services. No party has addressed the 
technical feasibility of modifying the existing toll free database to 
make only those 500 and 900 numbers that are assigned to LECs portable. 
We, therefore, direct the INC to examine this issue, and file a report 
with this Commission within twelve months of the effective date of this 
order addressing the technical feasibility of requiring LECs to make 
their assigned 500 and 900 numbers portable, whether it be through 
modifying the existing toll free database or through another system. 
Upon receipt of this report, we will take appropriate action under the 
1996 Act.

Regulatory Flexibility Act Analysis

Final Analysis of First Report and Order

    199. As required by section 603 of the Regulatory Flexibility Act, 
5 U.S.C. 603 (RFA), an Initial Regulatory Flexibility Analysis (IRFA) 
was incorporated in the NPRM (60 FR 39136, August 1, 1995). The 
Commission sought written public comments on the proposals in the NPRM, 
including the Initial Regulatory Flexibility Analysis. Our final 
analysis conforms to the RFA, as amended by the Contract With America 
Advancement Act of 1996, Pub. L. No. 104-121, 110 Stat. 847 (1996) 
(CWAAA). Subtitle II of CWAAA is ``The Small Business Regulatory 
Enforcement Fairness Act of 1996'' (SBREFA). The Commission's Final 
Regulatory Flexibility Analysis (FRFA) in this Report and Order is as 
follows:
    200. Need for and Objectives of Rules: The Commission, in 
compliance with sections 251(b)(2) and 251(d)(1) of the Communications 
Act of 1934, as amended by the Telecommunications Act of 1996 (the 
Act), adopts rules and procedures intended to ensure the prompt 
implementation of telephone number portability with the minimum 
regulatory and administrative burden on telecommunications carriers. 
These rules are necessary to implement the provision in the 
Telecommunications Act of 1996 (1996 Act) requiring local exchange 
carriers (LECs) to offer number portability, if technically feasible. 
In implementing the statute, the Commission has the responsibility to 
adopt rules that will implement most quickly and effectively the 
national telecommunications policy embodied in the Act and to promote 
the pro-competitive, deregulatory markets envisioned by Congress. 
Congress has recognized that number portability will lower barriers to 
entry and promote competition in the local exchange marketplace.
    201. Summary of Significant Issues Raised by the Public in Response 
to the IRFA: There were no comments submitted in response to the 
Initial Regulatory Flexibility Analysis. The Chief Counsel for Advocacy 
of the United States Small Business Administration filed comments on 
the NPRM which generally support the actions we take in this Report and 
Order. However, in their general comments, some commenters suggested a 
course of action which may result in less of an impact on small 
entities. Specifically, prior to passage of the 1996 Act, some LECs 
asserted that the Commission should neither adopt, nor direct the 
adoption of, number portability without performing a thorough cost/
benefit analysis. Most parties, however, now agree that the 1996 Act 
clearly directs the Commission to implement long-term number 
portability. In the Report and Order, we concluded that Congress has 
determined that the Commission should develop a national number 
portability policy and has specifically directed us to prescribe the 
requirements that all local exchange carriers, both incumbents and 
others, must meet to satisfy their statutory obligations. See 47 U.S.C. 
251(b)(2), (d). Moreover, section 251(e)(1)'s assignment to the 
Commission of exclusive jurisdiction over that portion of the North 
American Numbering Plan (NANP) that pertains to the United States gives 
us authority over the implementation of number portability to the 
extent that such implementation will affect the NANP. See 47 U.S.C. 
251(e)(1).
    202. Description and Estimate of Number of Small Businesses to 
Which Rules Will Apply: The Regulatory Flexibility Act generally 
defines the term ``small business'' as having the same meaning as the 
term ``small business concern'' under the Small Business Act, 15 U.S.C. 
632. A small business concern is one which (1) is independently owned 
and operated; (2) is not dominant in its field of operation;

[[Page 38636]]

and (3) satisfies any additional criteria established by the Small 
Business Administration (SBA). Id. According to the SBA's regulations, 
entities engaged in the provision of telephone service may have a 
maximum of 1,500 employees in order to qualify as a small business 
concern. 13 CFR 121.201. This standard also applies in determining 
whether an entity is a small business for purposes of the Regulatory 
Flexibility Act.
    203. Our rules governing long-term number portability apply to all 
LECs, including incumbent LECs as well as new LEC entrants, and also 
apply to cellular, broadband PCS, and covered SMR providers. According 
to the SBA definition, incumbent LECs do not qualify as small 
businesses because they are dominant in their field of operation. 
Accordingly, we will not address the impact of these rules on incumbent 
LECs.
    204. However, our rules may have a significant economic impact on a 
substantial number of small businesses insofar as they apply to 
telecommunications carriers other than incumbent LECs. The rules may 
have such an impact upon new entrant LECs, as well as cellular, 
broadband PCS, and covered SMR providers. Based upon data contained in 
the most recent census and a report by the Commission's Common Carrier 
Bureau, we estimate that 2,100 carriers could be affected. We have 
derived this estimate based on the following analysis:
    205. According to the 1992 Census of Transportation, 
Communications, and Utilities, there were approximately 3,469 firms 
with under 1,000 employees operating under the Standard Industrial 
Classification (SIC) category 481--Telephone. See U.S. Dept. of 
Commerce, Bureau of the Census, 1992 Census of Transportation, 
Communications, and Utilities (issued May 1995). Many of these firms 
are the incumbent LECs and, as noted above, would not satisfy the SBA 
definition of a small business because of their market dominance. There 
were approximately 1,350 LECs in 1995. Industry Analysis Division, FCC, 
Carrier Locator: Interstate Service Providers at Table 1 (Number of 
Carriers Reporting by Type of Carrier and Type of Revenue) (December 
1995). Subtracting this number from the total number of firms leaves 
approximately 2,119 entities which potentially are small businesses 
which may be affected. This number contains various categories of 
carriers, including competitive access providers, cellular carriers, 
interexchange carriers, mobile service carriers, operator service 
providers, pay telephone operators, PCS providers, covered SMR 
providers, and resellers. Some of these carriers--although not 
dominant--may not meet the other requirement of the definition of a 
small business because they are not ``independently owned and 
operated.'' See 15 U.S.C. 632. For example, a PCS provider which is 
affiliated with a long distance company with more than 1,000 employees 
would be disqualified from being considered a small business. Another 
example would be if a cellular provider is affiliated with a dominant 
LEC. Thus, a reasonable estimate of the number of ``small businesses'' 
affected by this Order would be approximately 2,100.
    206. Description of Projected Reporting, Recordkeeping and Other 
Compliance Requirements of the Rules: There are several reporting 
requirements imposed by the Report and Order. It is likely that the 
entities filing the reports will require the services of persons with 
technical expertise to prepare the reports. First, carriers 
participating in a field test in the Chicago, Illinois, area are 
required to file with the Commission a report of their findings within 
30 days after completion of the test. At this time, it is not clear how 
many carriers will be participating, but it is likely to include 
several new entrant LECs and the dominant incumbent LEC in the region. 
Second, after December 31, 1998, long-term number portability must be 
provided by LECs outside of the 100 largest MSAs within six months 
after a specific request by another telecommunications carrier in which 
the requesting carrier is operating or plans to operate. The request 
specifically must request long-term number portability, identify the 
discrete geographic area covered by the request, and provide a 
tentative date six or more months in the future when the carrier 
expects to need number portability in order to port prospective 
customers. Third, state regulatory commissions must file with the 
Commission a notification if they opt to develop a state-specific 
database in lieu of participating in a regional database system. 
Carriers that object to a state decision to opt out of the regional 
database system may file with the Commission a petition for relief. 
Fourth, the item requires any administrator selected by a state prior 
to the release of the Report and Order, that wishes to bid for 
administration of one of the regional databases, must submit a new 
proposal in accordance with the guidelines established by the NANC. We 
expect that only one entity, Lockheed Martin, will be subject to this 
requirement since it is the only administrator which has been selected 
by a state to date. Fifth, the Report and Order requires carriers that 
are unable to meet the deadlines for implementing a long-term number 
portability solution to file with the Commission at least 60 days in 
advance of the deadline a petition to extend the time by which 
implementation in its network will be completed. Finally, we require an 
industry body known as the Industry Numbering Committee (INC) to file a 
report with the Commission on the portability of non-geographic numbers 
assigned to LECs within 12 months after the effective date of the 
Report and Order.
    207. Steps Taken to Minimize Impact on Small Entities Consistent 
with Stated Objectives: The Commission's actions in this Report and 
Order will benefit small entities by facilitating their entry into the 
local exchange market. The record in this proceeding indicates that the 
lack of number portability would deter entry by competitive providers 
of local service because of the value customers place on retaining 
their telephone numbers. These competitive providers, many of which may 
be small entities, may find it easier to enter the market as a result 
of number portability which will eliminate this barrier to entry.
    208. In general, we have attempted to keep burdens on local 
exchange carriers to a minimum. For example, we have adopted a phased 
deployment schedule which requires long-term number portability to be 
implemented initially in the 100 largest MSAs, and then elsewhere upon 
a carrier's request. The provision of currently available measures is 
conditioned upon request only. In addition, we have attempted to 
minimize the impact of our rules upon cellular, broadband PCS, and 
covered SMR providers, which may be small businesses, by not requiring 
such carriers to offer currently available number portability measures. 
Similarly, paging and messaging service providers, which may be small 
entities, are required to provide neither currently available measures 
nor long-term number portability under our rules. The regulatory 
burdens we have imposed are necessary to ensure that the public 
receives the benefit of the expeditious provision of service provider 
number portability in accordance with the statutory requirements.

V. Ordering Clauses

    209. Accordingly, it is ordered that, pursuant to the authority 
contained in sections 1, 4(i), 4(j), 201-205, 218, 251, and 332 of the 
Communications Act as amended, 47 U.S.C. 151, 154(i), 154(j), 201-205, 
218, 251 and 332, Part 20 of

[[Page 38637]]

the Commission's rules, 47 CFR part 20, is amended, and part 52 of the 
Commission's rules, 47 CFR part 52, is added as set forth below.
    210. It is further ordered that the policies, rules, and 
requirements set forth herein are adopted, effective August 26, 1996 
except for collections of information subject to approval by the Office 
of Management and Budget (OMB), which are effective December 23, 1996.
    211. It is further ordered that, pursuant to the authority 
contained in sections 1, 4(i), 4(j), 201-205, 218, 251, and 332 of the 
Communications Act as amended, 47 U.S.C. 151, 154(i), 154(j), 201-205, 
218, 251, and 332, a Further Notice of Proposed Rulemaking is hereby 
adopted.
    212. It is further ordered that BellSouth's Motion to Accept Late 
Filed Comments is granted.
    213. It is further ordered that authority is delegated to the 
Chief, Common Carrier Bureau, as set forth supra in Paras.  78, 79, 85, 
97, and to the Chief, Wireless Telecommunications Bureau, as set forth 
supra in Paras.  166, 167.

List of Subjects

47 CFR Part 20

    Federal Communications Commission, Local number portability, Radio, 
Telecommunications.

47 CFR Part 52

    Federal Communications Commission, Cost recovery, Database 
architecture and administration, Local exchange carrier, Local number 
portability, Long-term database methods, Numbering, Telecommunications, 
Transitional methods.

Federal Communications Commission.
William F. Caton,
Acting Secretary.

Rule Changes

    Parts 20 and 52 of Title 47 of the Code of Federal Regulations are 
amended as follows:

PART 20--COMMERCIAL MOBILE RADIO SERVICES

    1. The authority citation for part 20 continues to read as follows:

    Authority: Secs. 4, 303, and 332, 48 Stat. 1066, 1082, as 
amended; 47 U.S.C. 154, 303, and 332, unless otherwise noted.

    2. Section 20.15 is amended by adding paragraph (e) to read as 
follows:


Sec. 20.15   Requirements under Title II of the Communications Act.

* * * * *
    (e) For obligations of commercial mobile radio service providers to 
provide local number portability, see Sec. 52.1 of this chapter.
    3. A new part 52 is added to read as follows:

PART 52--NUMBERING

Subpart A--[Reserved]

Subpart B--Local Number Portability

Sec.
52.1  Definitions.
52.3  Deployment of long-term database methods for number 
portability by LECs.
52.5  Database architecture and administration.
52.7  Deployment of transitional measures for number portability.
52.9  Cost recovery for transitional measures for number 
portability.
52.11  Deployment of long-term database methods for number 
portability by CMRS providers.
52.12 through 52.99  [Reserved].

Appendix to Part 52--Deployment Sechdule for Long-Term Database Methods 
for Local Number Portability

    Authority: Sec. 4, 48 Stat. 1066, as amended; 47 U.S.C. 154, 
unless otherwise noted. Interpret or apply sec. 153, 154, 201-04, 
218, 225-7, 251-2, 271, 48 Stat. 1070, as amended, 1077; 47 U.S.C. 
201-04, 218, 225-7, 251-2, 271 unless otherwise noted.

Subpart A--[Reserved]

Subpart B--Local Number Portability


Sec. 52.1   Definitions.

    As used in this subpart:
    (a) The term broadband PCS has the same meaning as that term is 
defined in Sec. 24.5 of this chapter.
    (b) The term cellular service has the same meaning as that term is 
defined in Sec. 22.99 of this chapter.
    (c) The term covered SMR means either 800 MHz and 900 MHz SMR 
licensees that hold geographic area licenses or incumbent wide area SMR 
licensees that offer real-time, two-way switched voice service that is 
interconnected with the public switched network, either on a stand-
alone basis or packaged with other telecommunications services. This 
term does not include local SMR licensees offering mainly dispatch 
services to specialized customers in a non-cellular system 
configuration, licensees offering only data, one-way, or stored voice 
services on an interconnected basis, or any SMR provider that is not 
interconnected to the public switched network.
    (d) The term database method means a number portability method that 
utilizes one or more external databases for providing called party 
routing information.
    (e) The term downstream database means a database owned and 
operated by an individual carrier for the purpose of providing number 
portability in conjunction with other functions and services.
    (f) The term incumbent local exchange carrier means, with respect 
to an area, the local exchange carrier that:
    (1) On February 8, 1996, provided telephone exchange service in 
such area; and
    (2)(i) On February 8, 1996, was deemed to be a member of the 
exchange carrier association pursuant to Sec. 69.601(b) of the 
Commission's regulations (47 CFR 69.601(b)); or
    (ii) Is a person or entity that, on or after February 8, 1996, 
became a successor or assign of a member described in paragraph 
(f)(2)(i) of this section.
    (g) The term incumbent wide area SMR licensee has the same meaning 
as that term is defined in Sec. 20.3 of this chapter.
    (h) The term local exchange carrier means any person that is 
engaged in the provision of telephone exchange service or exchange 
access. For purposes of this subpart, such term does not include a 
person insofar as such person is engaged in the provision of a 
commercial mobile service under 47 U.S.C. 332(c).
    (i) The term local number portability administrator (LNPA) means an 
independent, non-governmental entity, not aligned with any particular 
telecommunications industry segment, whose duties are determined by the 
NANC.
    (j) The term location portability means the ability of users of 
telecommunications services to retain existing telecommunications 
numbers without impairment of quality, reliability, or convenience when 
moving from one physical location to another.
    (k) The term long-term database method means a database method that 
complies with the performance criteria set forth in Sec. 52.3(a).
    (l) The term North American Numbering Council (NANC) means an 
advisory committee created under the Federal Advisory Committee Act, 5 
U.S.C., App (1988), to advise the Commission and to make 
recommendations, reached through consensus, that foster efficient and 
impartial number administration.
    (m) The term number portability means the ability of users of 
telecommunications services to retain, at the same location, existing 
telecommunications numbers without impairment of quality, reliability, 
or convenience when switching from one telecommunications carrier to 
another.

[[Page 38638]]

    (n) The term regional database means an SMS database or an SMS/SCP 
pair that contains information necessary for carriers to provide number 
portability in a region as determined by the NANC.
    (o) The term service control point (SCP) means a database in the 
public switched network which contains information and call processing 
instructions needed to process and complete a telephone call. The 
network switches access an SCP to obtain such information. Typically, 
the information contained in an SCP is obtained from the SMS.
    (p) The term service management system (SMS) means a database or 
computer system not part of the public switched network that, among 
other things:
    (1) Interconnects to an SCP and sends to that SCP the information 
and call processing instructions needed for a network switch to process 
and complete a telephone call; and
    (2) Provides telecommunications carriers with the capability of 
entering and storing data regarding the processing and completing of a 
telephone call.
    (q) The term service portability means the ability of users of 
telecommunications services to retain existing telecommunications 
numbers without impairment of quality, reliability, or convenience when 
switching from one telecommunications service to another, without 
switching from one telecommunications carrier to another.
    (r) The term service provider portability means the ability of 
users of telecommunications services to retain, at the same location, 
existing telecommunications numbers without impairment of quality, 
reliability, or convenience when switching from one telecommunications 
carrier to another.
    (s) The term telecommunications means the transmission, between or 
among points specified by the user, of information of the user's 
choosing, without change in the form or content of the information as 
sent and received.
    (t) The term telecommunications carrier means any provider of 
telecommunications services, except that such term does not include 
aggregators of telecommunications services (as defined in 47 U.S.C. 
226(a)(2)).
    (u) The term telecommunications service means the offering of 
telecommunications for a fee directly to the public, or to such classes 
of users as to be effectively available directly to the public, 
regardless of the facilities used.
    (v) The term transitional measure means a method such as Remote 
Call Forwarding (RCF), Flexible Direct Inward Dialing (DID), or other 
comparable and technically feasible arrangement that allows one local 
exchange carrier to transfer telephone numbers from its network to the 
network of another telecommunications carrier, but does not comply with 
the performance criteria set forth in Sec. 52.3(a).


Sec. 52.3   Deployment of long-term database methods for number 
portability by LECs.

    (a) Subject to paragraphs (b) and (c) of this section, all local 
exchange carriers (LECs) must provide number portability in compliance 
with the following performance criteria:
    (1) Supports network services, features, and capabilities existing 
at the time number portability is implemented, including but not 
limited to emergency services, CLASS features, operator and directory 
assistance services, and intercept capabilities;
    (2) Efficiently uses numbering resources;
    (3) Does not require end users to change their telecommunications 
numbers;
    (4) Does not require telecommunications carriers to rely on 
databases, other network facilities, or services provided by other 
telecommunications carriers in order to route calls to the proper 
termination point;
    (5) Does not result in unreasonable degradation in service quality 
or network reliability when implemented;
    (6) Does not result in any degradation in service quality or 
network reliability when customers switch carriers;
    (7) Does not result in a carrier having a proprietary interest;
    (8) Is able to migrate to location and service portability; and
    (9) Has no significant adverse impact outside the areas where 
number portability is deployed.
    (b) All LECs must provide a long-term database method for number 
portability in the 100 largest Metropolitan Statistical Areas (MSAs) by 
December 31, 1998, in accordance with the deployment schedule set forth 
in the appendix to this part 52.
    (c) Beginning January 1, 1999, all LECs must make a long-term 
database method for number portability available within six months 
after a specific request by another telecommunications carrier in areas 
in which that telecommunications carrier is operating or plans to 
operate.
    (d) The Chief, Common Carrier Bureau, may waive or stay any of the 
dates in the implementation schedule, as the Chief determines is 
necessary to ensure the efficient development of number portability, 
for a period not to exceed 9 months (i.e., no later than September 30, 
1999).
    (e) In the event a LEC is unable to meet the Commission's deadlines 
for implementing a long-term database method for number portability, it 
may file with the Commission at least 60 days in advance of the 
deadline a petition to extend the time by which implementation in its 
network will be completed. A LEC seeking such relief must demonstrate 
through substantial, credible evidence the basis for its contention 
that it is unable to comply with the deployment schedule set forth in 
the appendix to this part 52. Such requests must set forth:
    (1) The facts that demonstrate why the carrier is unable to meet 
the Commission's deployment schedule;
    (2) A detailed explanation of the activities that the carrier has 
undertaken to meet the implementation schedule prior to requesting an 
extension of time;
    (3) An identification of the particular switches for which the 
extension is requested;
    (4) The time within which the carrier will complete deployment in 
the affected switches; and
    (5) A proposed schedule with milestones for meeting the deployment 
date.
    (f) The Chief, Common Carrier Bureau, shall monitor the progress of 
local exchange carriers implementing number portability, and may direct 
such carriers to take any actions necessary to ensure compliance with 
the deployment schedule set forth in the appendix to this part 52.
    (g) Carriers that are members of the Illinois Local Number 
Portability Workshop must conduct a field test of any technically 
feasible long-term database method for number portability in the 
Chicago, Illinois, area concluding no later than August 31, 1997. The 
carriers participating in the test must jointly file with the Common 
Carrier Bureau a report of their findings within 30 days following 
completion of the test. The Chief, Common Carrier Bureau, shall monitor 
developments during the field test.


Sec. 52.5  Database architecture and administration.

    (a) The North American Numbering Council (NANC) shall direct 
establishment of a nationwide system of regional SMS databases for the 
provision of long-term database methods for number portability.
    (b) All telecommunications carriers shall have equal and open 
access to the regional databases.

[[Page 38639]]

    (c) The NANC shall select a local number portability 
administrator(s) (LNPA(s)) to administer the regional databases within 
seven months of the initial meeting of the NANC.
    (d) The NANC shall determine whether one or multiple 
administrator(s) should be selected, whether the LNPA(s) can be the 
same entity selected to be the North American Numbering Plan 
Administrator, how the LNPA(s) should be selected, the specific duties 
of the LNPA(s), the geographic coverage of the regional databases, the 
technical interoperability and operational standards, the user 
interface between telecommunications carriers and the LNPA(s), the 
network interface between the SMS and the downstream databases, and the 
technical specifications for the regional databases.
    (e) Once the NANC has selected the LNPA(s) and determined the 
locations of the regional databases, it must report its decisions to 
the Commission.
    (f) The information contained in the regional databases shall be 
limited to the information necessary to route telephone calls to the 
appropriate telecommunications carriers. The NANC shall determine what 
specific information is necessary.
    (g) Any state may opt out of its designated regional database and 
implement a state-specific database. A state must notify the Common 
Carrier Bureau and NANC that it plans to implement a state-specific 
database within 60 days from the release date of the Public Notice 
issued by the Chief, Common Carrier Bureau, identifying the 
administrator selected by the NANC and the proposed locations of the 
regional databases. Carriers may challenge a state's decision to opt 
out of the regional database system by filing a petition with the 
Commission.
    (h) Individual state databases must meet the national requirements 
and operational standards recommended by the NANC and adopted by the 
Commission. In addition, such state databases must be technically 
compatible with the regional system of databases and must not interfere 
with the scheduled implementation of the regional databases.
    (i) Individual carriers may download information necessary to 
provide number portability from the regional databases into their own 
downstream databases. Individual carriers may mix information needed to 
provide other services or functions with the information downloaded 
from the regional databases at their own downstream databases. Carriers 
may not withhold any information necessary to provide number 
portability from the regional databases on the grounds that such data 
has been combined with other information in its downstream database.


Sec. 52.7  Deployment of transitional measures for number portability.

    All LECs shall provide transitional measures, which may consist of 
Remote Call Forwarding (RCF), Flexible Direct Inward Dialing (DID), or 
any other comparable and technically feasible method, as soon as 
reasonably possible upon receipt of a specific request from another 
telecommunications carrier, until such time as the LEC implements a 
long-term database method for number portability in that area.


Sec. 52.9  Cost recovery for transitional measures for number 
portability.

    Any cost recovery mechanism for the provision of number portability 
pursuant to Sec. 52.7(a), that is adopted by a state commission must 
not:
    (a) Give one telecommunications carrier an appreciable, incremental 
cost advantage over another telecommunications carrier, when competing 
for a specific subscriber (i.e., the recovery mechanism may not have a 
disparate effect on the incremental costs of competing carriers seeking 
to serve the same customer); or
    (b) Have a disparate effect on the ability of competing 
telecommunications carriers to earn a normal return on their 
investment.


Sec. 52.11  Deployment of long-term database methods for number 
portability by CMRS providers.

    (a) By June 30, 1999, all cellular, broadband PCS, and covered SMR 
providers must provide a long-term database method for number 
portability, including the ability to support roaming, in compliance 
with the performance criteria set forth in Sec. 52.3(a).
    (b) By December 31, 1998, all cellular, broadband PCS, and covered 
SMR providers must have the capability to obtain routing information, 
either by querying the appropriate database themselves or by making 
arrangements with other carriers that are capable of performing 
database queries, so that they can deliver calls from their networks to 
any party that has retained its number after switching from one 
telecommunications carrier to another.
    (c) The Chief, Wireless Telecommunications Bureau, may waive or 
stay any of the dates in the implementation schedule, as the Chief 
determines is necessary to ensure the efficient development of number 
portability, for a period not to exceed 9 months (i.e., no later than 
September 30, 1999, for the deadline in paragraph (b) of this section, 
and no later than March 31, 2000, for the deadline in paragraph (a) of 
this section).
    (d) In the event a carrier subject to paragraphs (a) and (b) of 
this section is unable to meet the Commission's deadlines for 
implementing a long-term number portability method, it may file with 
the Commission at least 60 days in advance of the deadline a petition 
to extend the time by which implementation in its network will be 
completed. A carrier seeking such relief must demonstrate through 
substantial, credible evidence the basis for its contention that it is 
unable to comply with paragraphs (a) and (b) of this section. Such 
requests must set forth:
    (1) The facts that demonstrate why the carrier is unable to meet 
our deployment schedule;
    (2) A detailed explanation of the activities that the carrier has 
undertaken to meet the implementation schedule prior to requesting an 
extension of time;
    (3) An identification of the particular switches for which the 
extension is requested;
    (4) The time within which the carrier will complete deployment in 
the affected switches; and
    (5) A proposed schedule with milestones for meeting the deployment 
date.
    (e) The Chief, Wireless Telecommunications Bureau, may establish 
reporting requirements in order to monitor the progress of cellular, 
broadband PCS, and covered SMR providers implementing number 
portability, and may direct such carriers to take any actions necessary 
to ensure compliance with this deployment schedule.


Secs. 52.12 through 52.99  [Reserved]

Appendix to Part 52--Deployment Schedule for Long-Term Database Methods 
for Local Number Portability

    Implementation must be completed by the carriers in the relevant 
MSAs during the periods specified below:

                                                                        
                                                                        
                                                                        
                              10/97-12/97                               
Chicago, IL........................................................    3
Philadelphia, PA...................................................    4
Atlanta, GA........................................................    8
New York, NY.......................................................    2
Los Angeles, CA....................................................    1
Houston, TX........................................................    7
Minneapolis, MN....................................................   12
                                                                        
                                1/98-3/98                               
Detroit, MI........................................................    6
Cleveland, OH......................................................   20
Washington, DC.....................................................    5
Baltimore, MD......................................................   18
Miami, FL..........................................................   24
Fort Lauderdale, FL................................................   39
Orlando, FL........................................................   40
Cincinnati, OH.....................................................   30

[[Page 38640]]

                                                                        
Tampa, FL..........................................................   23
Boston, MA.........................................................    9
Riverside, CA......................................................   10
San Diego, CA......................................................   14
Dallas, TX.........................................................   11
St. Louis, MO......................................................   16
Phoenix, AZ........................................................   17
Seattle, WA........................................................   22
                                                                        
                                4/98-6/98                               
Indianapolis, IN...................................................   34
Milwaukee, WI......................................................   35
Columbus, OH.......................................................   38
Pittsburgh, PA.....................................................   19
Newark, NJ.........................................................   25
Norfolk, VA........................................................   32
New Orleans, LA....................................................   41
Charlotte, NC......................................................   43
Greensboro, NC.....................................................   48
Nashville, TN......................................................   51
Las Vegas, NV......................................................   50
Nassau, NY.........................................................   13
Buffalo, NY........................................................   44
Orange Co, CA......................................................   15
Oakland, CA........................................................   21
San Francisco, CA..................................................   29
Rochester, NY......................................................   49
Kansas City, KS....................................................   28
Fort Worth, TX.....................................................   33
Hartford, CT.......................................................   46
Denver, CO.........................................................   26
Portland, OR.......................................................   27
                                                                        
                                7/98-9/98                               
Grand Rapids, MI...................................................   56
Dayton, OH.........................................................   61
Akron, OH..........................................................   73
Gary, IN...........................................................   80
Bergen, NJ.........................................................   42
Middlesex, NJ......................................................   52
Monmouth, NJ.......................................................   54
Richmond, VA.......................................................   63
Memphis, TN........................................................   53
Louisville, KY.....................................................   57
Jacksonville, FL...................................................   58
Raleigh, NC........................................................   59
West Palm Beach, FL................................................   62
Greenville, SC.....................................................   66
Honolulu, HI.......................................................   65
Providence, RI.....................................................   47
Albany, NY.........................................................   64
San Jose, CA.......................................................   31
Sacramento, CA.....................................................   36
Fresno, CA.........................................................   68
San Antonio, TX....................................................   37
Oklahoma City, OK..................................................   55
Austin, TX.........................................................   60
Salt Lake City, UT.................................................   45
Tucson, AZ.........................................................   71
                                                                        
                               10/98-12/98                              
Toledo, OH.........................................................   81
Youngstown, OH.....................................................   85
Ann Arbor, MI......................................................   95
Fort Wayne, IN.....................................................  100
Scranton, PA.......................................................   78
Allentown, PA......................................................   82
Harrisburg, PA.....................................................   83
Jersey City, NJ....................................................   88
Wilmington, DE.....................................................   89
Birmingham, AL.....................................................   67
Knoxville, KY......................................................   79
Baton Rouge, LA....................................................   87
Charleston, SC.....................................................   92
Sarasota, FL.......................................................   93
Mobile, AL.........................................................   96
Columbia, SC.......................................................   98
Tulsa, OK..........................................................   70
Syracuse, NY.......................................................   69
Springfield, MA....................................................   86
Ventura, CA........................................................   72
Bakersfield, CA....................................................   84
Stockton, CA.......................................................   94
Vallejo, CA........................................................   99
El Paso, TX........................................................   74
Little Rock, AR....................................................   90
Wichita, KS........................................................   97
New Haven, CT......................................................   91
Omaha, NE..........................................................   75
Albuquerque, NM....................................................   76
Tacoma, WA.........................................................   77
                                                                        



    Note: This Appendix A will not be published in the Code of 
Federal Regulations.

Appendix A--100 Largest Metropolitan Statistical Areas (MSAs) and Their 
Populations

                                                                        
                                                                        
                                                                        
 1. Los Angeles, CA........................................    9,150,000
 2. New York, NY...........................................    8,584,000
 3. Chicago, IL............................................    7,668,000
 4. Philadelphia, PA.......................................    4,949,000
 5. Washington, DC.........................................    4,474,000
 6. Detroit, MI............................................    4,307,000
 7. Houston, TX............................................    3,653,000
 8. Atlanta, GA............................................    3,331,000
 9. Boston, MA*............................................    3,211,000
 10. Riverside, CA.........................................    2,907,000
 11. Dallas, TX............................................    2,898,000
 12. Minneapolis, MN.......................................    2,688,000
 13. Nassau, NY............................................    2,651,000
 14. San Diego, CA.........................................    2,621,000
 15. Orange Co., CA........................................    2,543,000
 16. St. Louis, MO.........................................    2,536,000
 17. Phoenix, AZ...........................................    2,473,000
 18. Baltimore, MD.........................................    2,458,000
 19. Pittsburgh, PA........................................    2,402,000
 20. Cleveland, OH.........................................    2,222,000
 21. Oakland, CA...........................................    2,182,000
 22. Seattle, WA...........................................    2,180,000
 23. Tampa, FL.............................................    2,157,000
 24. Miami, FL.............................................    2,025,000
 25. Newark, NJ............................................    1,934,000
 26. Denver, CO............................................    1,796,000
 27. Portland, OR..........................................    1,676,000
 28. Kansas City, KS.......................................    1,647,000
 29. San Francisco, CA.....................................    1,646,000
 30. Cincinnati, OH........................................    1,581,000
 31. San Jose, CA..........................................    1,557,000
 32. Norfolk, VA...........................................    1,529,000
 33. Fort Worth, TX........................................    1,464,000
 34. Indianapolis, IN......................................    1,462,000
 35. Milwaukee, WI.........................................    1,456,000
 36. Sacramento, CA........................................    1,441,000
 37. San Antonio, TX.......................................    1,437,000
 38. Columbus, OH..........................................    1,423,000
 39. Fort Lauderdale, FL...................................    1,383,000
 40. Orlando, FL...........................................    1,361,000
 41. New Orleans, LA.......................................    1,309,000
 42. Bergen, NJ............................................    1,304,000
 43. Charlotte, NC.........................................    1,260,000
 44. Buffalo, NY...........................................    1,189,000
 45. Salt Lake City, UT....................................    1,178,000
 46. Hartford, CT*.........................................    1,156,000
 47. Providence, RI*.......................................    1,131,000
 48. Greensboro, NC........................................    1,107,000
 49. Rochester, NY.........................................    1,090,000
 50. Las Vegas, NV.........................................    1,076,000
 51. Nashville, TN.........................................    1,070,000
 52. Middlesex, NJ.........................................    1,069,000
 53. Memphis, TN...........................................    1,056,000
 54. Monmouth, NJ..........................................    1,035,000
 55. Oklahoma City, OK.....................................    1,007,000
 56. Grand Rapids, MI......................................      985,000
 57. Louisville, KY........................................      981,000
 58. Jacksonville, FL......................................      972,000
 59. Raleigh, NC...........................................      965,000
 60. Austin, TX............................................      964,000
 61. Dayton, OH............................................      956,000
 62. West Palm Beach, FL...................................      955,000
 63. Richmond, VA..........................................      917,000
 64. Albany, NY............................................      875,000
 65. Honolulu, HI..........................................      874,000
 66. Greenville, SC........................................      873,000
 67. Birmingham, AL........................................      872,000
 68. Fresno, CA............................................      835,000
 69. Syracuse, NY..........................................      754,000
 70. Tulsa, OK.............................................      743,000
 71. Tucson, AZ............................................      732,000
 72. Ventura, CA...........................................      703,000
 73. Akron, OH.............................................      677,000
 74. El Paso, TX...........................................      665,000
 75. Omaha, NE.............................................      663,000
 76. Albuquerque, NM.......................................      646,000
 77. Tacoma, WA............................................      638,000
 78. Scranton, PA..........................................      637,000
 79. Knoxville, TN.........................................      631,000
 80. Gary, IN..............................................      620,000
 81. Toledo, OH............................................      614,000
 82. Allentown, PA.........................................      612,000
 83. Harrisburg, PA........................................      610,000
 84. Bakersfield, CA.......................................      609,000
 85. Youngstown, OH........................................      604,000
 86. Springfield, MA*......................................      584,000
 87. Baton Rouge, LA.......................................      558,000
 88. Jersey City, NJ.......................................      552,000
 89. Wilmington, DE........................................      539,000
 90. Little Rock, AR.......................................      538,000
 91. New Haven, CT*........................................      527,000
 92. Charleston, SC........................................      522,000
 93. Sarasota, FL..........................................      518,000
 94. Stockton, CA..........................................      518,000
 95. Ann Arbor, MI.........................................      515,000
 96. Mobile, AL............................................      512,000
 97. Wichita, KS...........................................      507,000
 98. Columbia, SC..........................................      486,000
 99. Vallejo, CA...........................................      483,000
100. Fort Wayne, IN........................................     469,000 
                                                                        
*Population figures for New England's city and town based MSAs are for  
  1992, while others are for 1994.                                      

    Note: This Appendix B will not be published in the Code of 
Federal Regulations.

Appendix B--Description of Number Portability Methods

I. Database methods

    1. Location Routing Number (LRN). Under AT&T's LRN proposal, a 
carrier seeking to route a call to a ported number queries or 
``dips'' an external routing database, obtains a ten-digit location 
routing number for the ported number, and uses that location routing 
number to route the call to the end office switch which serves the 
called party. The carrier dipping the database may be the 
originating carrier, the terminating carrier, or the N-1 carrier 
(the carrier prior to the terminating carrier). Under the LRN 
method, a unique location routing number is assigned to each switch. 
For example, a local service provider receiving a 7-digit local 
call, such as 887-1234, would examine the dialed number to determine 
if the NPA-NXX is a portable code. If so, the 7 digit dialed number 
would be prefixed with the NPA and a 10-digit query (e.g., 679-887-
1234) would be launched to the routing database. The routing 
database then would return the LRN (e.g.,

[[Page 38641]]

679-267-0000) associated with the dialed number which the local 
service provider uses to route the call to the appropriate switch. 
The local service provider then would formulate an SS7 call set up 
message with a generic address parameter, along with the forward 
call indicator set to indicate that the query has been performed, 
and route the call to the local service provider's tandem for 
forwarding.
    2. LRN is a ``single-number solution'' because only one number 
(i.e., the number dialed by the calling party) is used to identify 
the customer in the serving switch. Each switch has one network 
address--the location routing number. The record and the Industry 
Numbering Committee (INC) indicate that LRN supports custom local 
area signalling services (CLASS), emergency services, and operator 
and directory services, but may result in some additional post-dial 
delay. LRN can support location and service as well as service 
provider portability. Finally, LRN supports wireless-wireline and 
wireless-wireless service provider portability.
    3. Carrier Portability Code (CPC). Under CPC, each local service 
provider within a given area would be assigned a three-digit Carrier 
Portability Code (CPC). The database serving that area would contain 
all the telephone numbers that have been transferred from one 
carrier to another and their corresponding CPCs. A carrier querying 
the database for purposes of routing a call to a customer that has 
transferred his or her telephone number would know from the NXX code 
of the dialed number that the telephone number may have been 
transferred to another local service provider. The carrier would 
query a database serving that area, which would return to the 
carrier a three-digit CPC corresponding to the service provider 
serving the dialed number. The carrier then would route the call 
according to the carrier portability code and the dialed NXX code. 
For example, an IXC delivering a call to the 301 NPA would query the 
database serving the 301 area code. In return, that database would 
transmit back to the IXC a ten-digit number consisting of the three-
digit NPA replaced with the CPC for the LEC serving that customer, 
plus the customer's seven-digit telephone number. The IXC then would 
route the call to the location pre-designated by the terminating 
carrier based on the six-digit CPC-NXX. Similarly, carriers 
providing service within the area would query the same database to 
identify the local service provider responsible for handling 
specific local calls.
    4. AT&T asserts that CPC is compatible with LRN by permitting 
adoption of switch trigger mechanisms, switch interfaces, signalling 
translations, and the development of an SMS to an LRN environment. 
CPC supports an N-1 call processing scenario, avoids routing calls 
through incumbent LEC networks, permits carriers to own or provide 
for their own routing databases, and supports vertical features. On 
the other hand, the CPC method essentially uses two NPA codes, and 
therefore precludes use of the second NPA code for other purposes. 
CPC supports location portability to a limited extent. It is not 
clear how operator services, such as busy line verification, collect 
calls, calling card calls, and third-party billing, would be handled 
under this proposal. Routing telephone calls based on carrier 
portability codes likely will require, among other things, that the 
software be modified in each network switch located in the NPA 
within which this system is deployed. It also would require 
modification to the Local Exchange Routing Guide (LERG) on the same 
NPA-basis so that the LERG contains routing data based on carrier 
portability codes.
    5. Release-to-Pivot (RTP). Carriers using RTP attempt to 
complete all calls as they presently do to a switch that is assigned 
a given NPA-NXX. If the dialed number has not been ported, the call 
will be completed exactly as it is currently. If the dialed number 
has been ported from the switch (the ``release'' switch), the call 
will be released back to a previous switch (the ``pivot'' switch) in 
the call path along with rerouting information (RI). The pivot 
switch uses the RI to reroute the call to the new switch. For 
example, a switch with pivot capabilities would determine whether a 
particular call should proceed to a release capable switch. The 
pivot switch would formulate an initial address message (IAM) 
containing a capability indicator informing the release switch that 
the call can be released back to the pivot switch. Once the release 
switch receives the call, it would use a translation table to 
determine whether the called number has been ported. If it has, the 
switch then would formulate a release message containing a cause 
value (RTP) and an LRN for delivery back to the pivot switch. The 
LRN would be included in the release message as a redirection 
number. The pivot switch then would access a translation table and 
determine routing based on the first six digits of the LRN. A new 
IAM then would be formulated and the call redirected to the 
appropriate switch.
    6. RTP must traverse the existing LEC network by means of 
switches equipped with release and pivot functionality and an 
internal database for call setup. RTP using the location routing 
number to route calls is a single-number solution. RTP does not 
involve the assignment of ``pseudo numbers,'' which minimizes number 
exhaust. RTP should not interfere with emergency services or 
operator and directory services, but may increase call setup time 
and post-dial delay. RTP can support service as well as service 
provider portability, but it is unclear to what extent RTP can 
support location portability. Finally, RTP supports portability 
between wireless carriers, but it is unclear whether it can support 
wireless-wireline portability. Some parties believe that RTP is not 
appropriate for long-term implementation of service provider 
portability because of its reliance on the networks of incumbent 
LECs, the potential for post-dial delay, and its inefficient use of 
signaling links.
    7. Query on Release (QOR). Also known as ``Look Ahead,'' QOR is 
similar to RTP in that queries are performed only for calls to 
ported numbers. However, QOR is different in several respects. Prior 
to querying a routing database, the switch from which the call 
originates reserves the appropriate call path through the SS7 
network and attempts to complete a call to the switch where the NPA-
NXX of the dialed number resides. If the number is ported, the call 
is released back to a previous switch in the call path, which 
performs a query to determine the LRN of the new serving switch. The 
call then is routed to the serving switch. This method differs from 
RTP in that when a number has been ported from the Release switch, 
the previous switch in the call path will query the database to 
obtain the routing information instead of that information being 
supplied by the Release switch. In other words, the switch that 
redirects the call also performs the query, thus eliminating the 
need for the carrier to which the number was originally assigned to 
provide routing information. Pacific Bell indicates that QOR can 
support both location and service portability, since any call can be 
released back and routed through a non-incumbent provider's network.
    8. Local Area Number Portability (LANP). Under this proposal, 
each customer is assigned a ten-digit customer number address (CNA) 
which is mapped to a unique ten-digit network node address (NNA), 
both of which are stored in routing databases. A service provider 
receives the called number (the CNA), queries a routing database, 
translates the called number from its CNA to its associated NNA, 
uses the NNA to route the call, and passes the NNA to the serving 
end office which, based on the NNA, terminates the call to the 
appropriate line or trunk. Unlike LRN, which assigns a unique 
location routing number to each switch, LANP requires a separate NNA 
for each CNA. The California Local Number Portability Task Force 
indicates that LANP does not result in post-dial delay or require 
changes in the wireless networks. In addition, LANP supports service 
provider, service, and unrestricted location portability. Moreover, 
the CNA can be disassociated from the switches and moved to a common 
pool of numbers for reassignment. However, LANP may impact emergency 
services, as the information displayed at the Public Safety 
Answering Point (PSAP) will initially be the NNA rather than the 
CNA. Some parties and state commissions believe that the LANP method 
is not a viable option for long-term number portability because it 
is too complicated to implement.
    9. Non-Geographic Number (NGN). Under this approach, which 
overlays the existing LEC network, a ported subscriber is assigned a 
non-geographic number (NGN) and a geographic number (GN) that 
indicates the customer's physical location and the serving central 
office. If the customer moves or changes local service providers, 
the GN--but not the NGN--changes, similar to 800 service. When the 
NGN is dialed, the NGN is translated into the GN through a database 
query, and the call is routed based on the GN as is done today. All 
other calls are processed as they are currently. A database dip is 
required only for calls to ported numbers. Ported calls will 
experience longer call setup delay and post-dial delay. Emergency 
and operator and directory services are not affected. This approach 
supports service provider, service, and unlimited location 
portability. On the other hand, NGN strains numbering resources by 
forcing all ported

[[Page 38642]]

customers to limited non-geographic numbers, requires a nationwide 
cut-over, and requires an initial change of telephone numbers to 
obtain portability.

II. Non-database methods

    1. Remote Call Forwarding (RCF). RCF is an existing LEC service 
that redirects calls in the telephone network and can be adapted to 
provide a semblance of service provider number portability. If a 
customer transfers his or her existing telephone number from Carrier 
A to Carrier B, any call to that customer is routed to the central 
office switch operated by Carrier A that is designated by the NXX 
code of the customer's telephone number. Carrier A's switch routes 
that call to Carrier B, translating the dialed number into a number 
with an NXX corresponding to a switch operated by Carrier B. Carrier 
B then completes the routing of the call to its customer. The change 
in terminating carriers is transparent to the calling party. 
Disadvantages of RCF include the following: (1) It requires the use 
of two, ten-digit telephone numbers and thus strains number plan 
administration and contributes to area code exhaust; (2) it 
generally does not support several custom local area signalling 
services (CLASS), such as caller ID, and may degrade transmission 
quality, because it actually places a second call to a transparent 
telephone number; (3) it can handle only a limited number of calls 
to customers of the same competing service provider at any one time; 
(4) it may result in longer call set-up times; (5) it requires the 
use of the incumbent LEC network for routing of calls; (6) it may 
enable incumbents to access competitors' proprietary information; 
(7) it may result in more complicated resolution of customer 
complaints; (8) the potential for call blocking may be increased; 
and (9) it may impose substantial costs upon new entrants.
    2. Flexible Direct Inward Dialing (DID). DID works similarly to 
RCF, except the original service provider routes calls to the dialed 
number over a dedicated facility to the new service provider's 
switch instead of translating the dialed number to a new number. DID 
has many of the same limitations as RCF, although DID can process 
more simultaneous calls to a competing service provider.
    3. Other. We are aware of three derivatives of RCF and DID, all 
of which require routing of all incoming calls to the terminating 
switch identified by the NXX code of the dialed phone number, and 
involve the loss of CLASS functionalities. Unlike RCF and DID, they 
use LEC tandem switches to aggregate calls to a particular competing 
service provider before those calls are routed to that provider. In 
addition, Cablevision Lightpath advocates use of Trunk Route 
Indexing (TRI), which it claims routes calls directly to the 
competitor's interconnection facilities and supports CLASS features. 
Finally, Directory Number Route Indexing (DNRI) is a method which 
first routes incoming calls to the switch to which the NPA-NXX code 
originally was assigned. DNRI then routes ported calls to the new 
service either through a direct trunk or by attaching a temporary 
``pseudo NPA'' to the number and using a tandem, depending on 
availability.
    Note: This Appendix C will not be published in the Code of 
Federal Regulations.

Appendix C--Implementation Schedule

    Implementation must be completed by the carriers in the relevant 
MSAs during the periods specified below:

                                                                        
                                                                        
                                                                        
                               10/97-12/97                              
Chicago, IL........................................................    3
Philadelphia, PA...................................................    4
Atlanta, GA........................................................    8
New York, NY.......................................................    2
Los Angeles, CA....................................................    1
Houston, TX........................................................    7
Minneapolis, MN....................................................   12
                                                                        
                                1/98-3/98                               
Detroit, MI........................................................    6
Cleveland, OH......................................................   20
Washington, DC.....................................................    5
Baltimore, MD......................................................   18
Miami, FL..........................................................   24
Fort Lauderdale, FL................................................   39
Orlando, FL........................................................   40
Cincinnati, OH.....................................................   30
Tampa, FL..........................................................   23
Boston, MA.........................................................    9
Riverside, CA......................................................   10
San Diego, CA......................................................   14
Dallas, TX.........................................................   11
St. Louis, MO......................................................   16
Phoenix, AZ........................................................   17
Seattle, WA........................................................   22
                                                                        
                                4/98-6/98                               
Indianapolis, IN...................................................   34
Milwaukee, WI......................................................   35
Columbus, OH.......................................................   38
Pittsburgh, PA.....................................................   19
Newark, NJ.........................................................   25
Norfolk, VA........................................................   32
New Orleans, LA....................................................   41
Charlotte, NC......................................................   43
Greensboro, NC.....................................................   48
Nashville, TN......................................................   51
Las Vegas, NV......................................................   50
Nassau, NY.........................................................   13
Buffalo, NY........................................................   44
Orange Co, CA......................................................   15
Oakland, CA........................................................   21
San Francisco, CA..................................................   29
Rochester, NY......................................................   49
Kansas City, KS....................................................   28
Fort Worth, TX.....................................................   33
Hartford, CT.......................................................   46
Denver, CO.........................................................   26
Portland, OR.......................................................   27
                                                                        
                                7/98-9/98                               
Grand Rapids, MI...................................................   56
Dayton, OH.........................................................   61
Akron, OH..........................................................   73
Gary, IN...........................................................   80
Bergen, NJ.........................................................   42
Middlesex, NJ......................................................   52
Monmouth, NJ.......................................................   54
Richmond, VA.......................................................   63
Memphis, TN........................................................   53
Louisville, KY.....................................................   57
Jacksonville, FL...................................................   58
Raleigh, NC........................................................   59
West Palm Beach, FL................................................   62
Greenville, SC.....................................................   66
Honolulu, HI.......................................................   65
Providence, RI.....................................................   47
Albany, NY.........................................................   64
San Jose, CA.......................................................   31
Sacramento, CA.....................................................   36
Fresno, CA.........................................................   68
San Antonio, TX....................................................   37
Oklahoma City, OK..................................................   55
Austin, TX.........................................................   60
Salt Lake City, UT.................................................   45
Tucson, AZ.........................................................   71
                                                                        
                               10/98-12/98                              
Toledo, OH.........................................................   81
Youngstown, OH.....................................................   85
Ann Arbor, MI......................................................   95
Fort Wayne, IN.....................................................  100
Scranton, PA.......................................................   78
Allentown, PA......................................................   82
Harrisburg, PA.....................................................   83
Jersey City, NJ....................................................   88
Wilmington, DE.....................................................   89
Birmingham, AL.....................................................   67
Knoxville, KY......................................................   79
Baton Rouge, LA....................................................   87
Charleston, SC.....................................................   92
Sarasota, FL.......................................................   93
Mobile, AL.........................................................   96
Columbia, SC.......................................................   98
Tulsa, OK..........................................................   70
Syracuse, NY.......................................................   69
Springfield, MA....................................................   86
Ventura, CA........................................................   72
Bakersfield, CA....................................................   84
Stockton, CA.......................................................   94
Vallejo, CA........................................................   99
El Paso, TX........................................................   74
Little Rock, AR....................................................   90
Wichita, KS........................................................   97
New Haven, CT......................................................   91
Omaha, NE..........................................................   75
Albuquerque, NM....................................................   76
Tacoma, WA.........................................................   77
                                                                        

[FR Doc. 96-18477 Filed 7-24-96; 8:45 am]
BILLING CODE 6712-01-P