[Federal Register Volume 65, Number 6 (Monday, January 10, 2000)]
[Rules and Regulations]
[Pages 1331-1346]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-458]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 51
[CC Dockets No. 98-147 and 96-98; FCC 99-355]
Deployment of Wireline Services Offering Advanced
Telecommunications Capability
AGENCY: Federal Communications Commission
ACTION: Final rule
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SUMMARY: This document adopts measures to promote the availability of
competitive broadband xDSL-based services, especially to residential
and small business customers. This document amends the Commission's
unbundling rules to require incumbent LECs to provide unbundled access
to a new network element, the high frequency portion of the local loop.
This will enable competitive LECs to compete with incumbent LECs to
provide to consumers xDSL-based services through telephone lines that
the competitive LECs can share with incumbent LECs. In addition, the
document adopts spectrum management policies and rules to facilitate
the competitive deployment of advanced services. These rules will
significantly benefit the rapid and efficient deployment of xDSL-based
technologies.
DATES: Effective February 9, 2000.
FOR FURTHER INFORMATION CONTACT: Staci Pies, (202) 418-1580. For
further information concerning the information collection contained in
this document, contact Les Smith, Federal Communications Commission,
Room 1A-804, 445 12th Street, S.W., Washington, D.C. 20554, or via
Internet at [email protected].
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Third
Report and Order in CC Docket No. 98-147 and Fourth Report and Order in
CC Docket 96-98, adopted on November 18, 1999, and released on December
9, 1999. The complete text of the order is available for inspection and
copying during normal business hours in the FCC Reference Information
Center, Courtyard Level, 445 12th Street S.W., Washington, D.C., and
also may be purchased from the Commission's copy contractor,
International Transcription Services (ITS, Inc.), CY-B4000, 445 12th
Street, S.W., Washington, D.C. it is also available via the Internet at
the Commission's home page, http:www.fcc.gov/Common__Carrier/Orders/
1999/fcc99355.doc.
Synopsis of the Third Report and Order and Fourth Report and Order
I. Introduction
1. The Commission adopts a Third Report and Order in CC Docket No.
98-147 and Fourth Report and Order in CC Docket No. 96-98,
(collectively ``Third R&O'') to promote the availability of competitive
broadband xDSL-based services, especially to residential and small
business customers. Specifically, the Commission amends the unbundling
rules to require incumbent LECs to provide unbundled access to a new
network element, the high frequency portion of the local loop. This
will enable competitive LECs to compete with incumbent LECs to provide
to consumers xDSL-based services through telephone lines that the
competitive LECs can share with incumbent LECs. The provision of xDSL-
based service by a competitive LEC and voiceband service by an
incumbent LEC on the same loop is frequently called ``line sharing.''
2. In addition, the Commission adopts rules in this Order that
apply to spectrum compatibility and management. These rules will
significantly benefit the rapid and efficient deployment of xDSL-based
technologies. Specifically, the Commission seeks to encourage the
voluntary development of industry standards while limiting the ability
of any one class of carriers to impose unilateral and potentially anti-
competitive spectrum management or compatibility rules on other xDSL
providers. The spectrum policies adopted in this Order will ensure the
compatibility of technologies and minimize the risk of harmful spectrum
interference among transmission services. As such, these policies will
ensure that American consumers will not face undue delay in receiving
the benefits of technological innovation.
[[Page 1332]]
II. Line Sharing
3. The Third R&O concludes that the Commission has authority to
require incumbent LECs to provide unbundled access to the high
frequency spectrum of a local loop pursuant to our authority to
identify a minimum list of network elements that must be unbundled on a
nationwide basis. Section 251(c)(3) imposes a duty on all incumbent
LECs to provide to competitors access to network elements on an
unbundled basis. The standard for unbundling is set out in section
251(d)(2). Section 251(d)(2) provides that, in determining which
network elements should be unbundled under section 251(c)(3), the
Commission shall consider, ``at a minimum, whether--(A) access to such
network elements as are proprietary in nature is necessary; and (B) the
failure to provide access to such network element would impair the
ability of the telecommunications carrier seeking access to provide the
services that it seeks to offer.'' Based on this language the Third R&O
concludes that the high frequency portion of the loop is a network
element that must be unbundled pursuant to section 251(c)(3) and
section 251(d)(2).
4. Line sharing generally describes the ability of two different
service providers to offer two services over the same line, with each
provider employing different frequencies to transport voice or data
over that line. Section 3(29) of the Act defines a network element as
``a facility or equipment used in the provision of telecommunications
services'' including ``features, functions, and capabilities, that are
provided by means of such facility or equipment.'' The frequencies
above those used for analog voice services on any loop are a capability
of that loop. Therefore, those otherwise unused frequencies that can be
used for xDSL or other applications meet the definition of a ``network
element.''
5. Specifically, Secs. 51.307(d) and 51.309(c) of the Commission's
rules address the requesting carrier's right to loop access. These
rules provide, respectively, that an incumbent LEC must provide
competitors with ``access to the facility or functionality of a
requested network element separate from access to the facility or
functionality of other network elements.'' The rules also state that a
requesting carrier is ``entitled to exclusive use'' of an ``unbundled
network facility.'' Consequently, although the Third R&O concludes that
to the extent section 251(d) is satisfied requesting carriers may
access unbundled loop functionalities, such as non-voiceband
transmission frequencies, separate from other loop functions, they are
also ``entitled,'' at their option, to exclusive use of the entire
unbundled loop facility.
6. High Frequency Loop Spectrum. The Third R&O concludes that
access to the high frequency spectrum of a local loop meets the
statutory definition of a network element and satisfies the
requirements of sections 251(d)(2) and (c)(3). It is technically
feasible for an incumbent LEC to provide a competitive LEC with access
to the high frequency portion of the local loop as an unbundled network
element. An incumbent LEC's failure to provide access impairs the
ability of a competitive LEC to offer, on a competitive basis, certain
forms of xDSL-based service that are capable of line sharing with voice
services. The Third R&O finds that lack of access to the high frequency
portion of the local loop would materially raise competitive LECs' cost
of providing xDSL-based service to residential and small business
users, delaying broad facilities-based market entry, and materially
limiting the scope and quality of competitors' service offerings. It
finds that access to the high frequency portion of the loop encourages
the deployment of advanced telecommunications capability to all
Americans as mandated by section 706 of the 1996 Act. Because some
residential and small business markets may lack the economic
characteristics that would support competitive entry in the absence of
access to the high frequency spectrum of a local loop, it is clear that
spectrum unbundling is crucial for the deployment of broadband services
to the mass consumer market.
7. The Third R&O defines the high frequency spectrum network
element to be the frequency range above the voiceband on a copper loop
facility used to carry analog circuit-switched voiceband transmissions.
The Third R&O does not mandate a particular technological approach to
the use of a line for multiple services. Line sharing relies on rapidly
evolving technology and our requirement that incumbent LECs provide the
high frequency spectrum of a local loop as an unbundled network element
should stimulate technological innovation. The Third R&O does not set a
specific dividing line between the low frequency channel and a high
frequency channel on the loop.
8. The Third R&O supports the use of any transmission technology
that is presumed acceptable for shared-line deployment with analog
voice service according to the criteria already identified in the First
R&O 14 FR Rcd 4761 (1999), 63 FR 44220 August 18, 1998, and codified in
the Third R&O.
9. The Third R&O finds that there are no proprietary concerns
associated with unbundled access to the high frequency spectrum of the
local loop. It finds that there are no copyright, patent, or trade
secrecy implications to unbundled access to the high frequency spectrum
UNE. Carriers do not generally rely upon loop spectrum to differentiate
themselves from their competitors. Thus, the high frequency spectrum is
not proprietary
10. The Third R&O concludes that a lack of access to high frequency
spectrum of a local loop impairs a competitive carrier's ability to
offer certain forms of xDSL-based service. Just as the loop itself
remains a facility available only from an incumbent LEC, so too is a
competitor seeking to offer certain xDSL-based services impaired if it
does not have access to the high frequency spectrum of the local loop
available from an incumbent LEC.
11. Section 251 requires incumbent LECs to provide unbundled access
to a network element where lack of access impairs the ability of the
requesting carrier to provide the services that it seeks to offer. The
Third R&O finds that most xDSL lines have been deployed to residential
or small business consumers, and incumbent LECs provide service on the
vast majority of these lines where their xDSL-based service shares the
line with their voice service. Incumbent LECs generally deploy forms of
xDSL-based services that can coexist with voice service on a single
line. This enables incumbent LECs to utilize the full capacity of the
copper local loop to efficiently provide both voice and data service to
a customer. Competitive LECs seeking to deploy xDSL-based service to
customers subscribing to the incumbent LEC's voice telephone service
cannot deploy their xDSL with the same efficiency or at the same cost.
Incumbent LECs currently do not permit competitive LECs to access the
high frequency portion of the loop to provide xDSL-based services, even
though the incumbent LECs utilize the high frequency portion of the
loop to deploy their own services. This situation materially diminishes
the competitive LEC's ability to provide the particular type of xDSL-
based service that it seeks to offer.
12. In contrast, the Third R&O finds that competitors are not
impaired where they seek to deploy those versions of xDSL-based
services that require a dedicated local loop, such as SDSL or HDSL,
because they can procure unbundled loops to deploy such service. For
larger business users, competitive
[[Page 1333]]
and incumbent LECs have to date maintained a degree of competitive
parity, acquiring similar customer volumes. The larger business market
tends to favor robust, high-capacity, symmetrical forms of xDSL, such
as SDSL. These types of xDSL are not compatible with voice service
provided over the same line in a line sharing arrangement, because they
utilize the whole loop frequency spectrum. Thus, both incumbent and
competitive LECs must deploy these forms of xDSL over dedicated loops.
Comparable levels of market penetration between incumbent and
competitive LECs indicates that competitive LECs are not impaired where
they can procure unbundled loops to provide these services.
13. The Third R&O concludes that carriers seeking to deploy voice-
compatible xDSL-based services cannot self-provision loops. The Third
R&O also concludes purchasing or self-provisioning a second loop is not
possible as a practical, operational or economic matter. First, second
loops are not ubiquitously available. Refusing to unbundle the high
frequency portion of the loop in this situation forecloses competitive
access to the segment of consumers that lack additional copper pairs to
their homes or small businesses. Where a customer premises is only
addressed by one copper loop, or where end users have exhausted the
facilities that serve them by installing multiple phone, modem, and fax
lines, end users will have no additional facilities available at their
premises which a competitive xDSL service provider could use to provide
service. In those situations, competitive xDSL service providers are
precluded from providing the services they seek to offer, and consumers
are deprived of the benefits of competition. This is particularly a
problem in rural areas, where spare copper facilities are less common.
Without a requirement that the incumbent LEC must provide competitors
with access to the high frequency portion of these loops, only the
voice service provider that already controls the entire loop can
provide xDSL-based service to that customer. In virtually all cases,
this provider will be the incumbent LEC. Thus, lack of access to the
high frequency portion of the loop reduces the efficient use of
existing loop plant and diminishes the scope of potential customers to
whom competitive LECs can market xDSL-based service, thereby limiting
the competitive choices available to consumers for whom additional
copper loops are not available. In addition, such lack of access can
accelerate the depletion of copper loops in entire communities,
necessitating inefficient capital expenditures that will increase costs
imposed on consumers and competitors alike. Even if there are spare
pairs in the ``drop'' to a home or business, there are not
corresponding pairs in the feeder plant connecting the neighborhood to
the central office.
14. Second, the Third R&O concludes that if competitive LECs were
to purchase or self-provision a second unbundled loop to provide voice-
compatible xDSL-based services, their provisioning of service would be
materially more costly, and coincidentally less efficient, than
purchasing the unbundled high-frequency portion of the loop. The
inability of competing carriers to provide xDSL-based services over the
same loop facilities that the incumbents use to provide local exchange
service makes the provision of competitive xDSL-based services to
customers that want a single line for both voice and data
applications--typically small businesses and mass market residential
consumers--not just marginally more expensive, but so prohibitively
expensive that competitive LECs will not be able to provide such
services on a sustained economic basis. Accordingly, a requesting
carrier providing voice-compatible xDSL-based services is impaired
without access to the unbundled high frequency portion of the loop.
15. Specifically, incumbent LECs refuse to permit competitive LECs
to deploy xDSL-based service to their customers on the same customer
loops through which incumbents provide voice services, although
incumbents regularly deploy both services on the same loop. As a
result, a competitive LEC providing xDSL to a customer subscribing to
an incumbent LEC's voice service must provide a second customer loop
for the customer's xDSL service, effectively doubling the line access
charges for that customer's voice and xDSL services, and providing a
distinct cost advantage to incumbent LEC-provided xDSL products. The
Third R&O finds that the combined collocation and unbundled loop costs,
exclusive of incremental and fixed network, equipment, and overhead
costs, incurred by a competitive LEC seeking to deploy xDSL service can
exceed 100% of the retail price for the comparable shared-line xDSL
that the incumbent offers to the same customer that the competitor is
vying for. It also finds that incumbents charge requesting carriers
almost as much or more, on a monthly basis, for an unbundled,
conditioned loop, as the incumbent charges its retail customers for
xDSL service. This price discrepancy between what an incumbent can
charge its customer for its own shared-line xDSL and what a competitor
must pay to the incumbent just to gain access to that customer
materially diminishes the ability of the competitive carrier to offer
voice-compatible xDSL-based services in competition with incumbent LEC.
16. The Third R&O finds that it is not economical for competitive
LECs to self-provision or purchase the entire loop as a second line
just to obtain access to the high frequency portion of the loop.
Incumbent LECs generally allocate virtually all loop costs to their
voice services, then deploy a voice-compatible xDSL service such as
ADSL on the same loop, allocating little or no incremental loop costs
to the new resulting service. In contrast, when the competitive LEC
procures a second loop, it must pay the incumbent LEC the full price of
that unbundled loop as an unbundled network element. The cost of that
additional loop often accounts for 30 to 50% of the competitor's total
cost of providing service. Thus, the incumbent LEC's voice-compatible
xDSL service enjoys substantial cost advantages over a competitive
LEC's xDSL offerings.
17. Third, the Order finds that a competitive carrier faces a
competitive disadvantage in providing xDSL over a second line when
competing against the incumbent's single line offering. The incumbent
is able to market its own service to customers as a quick and
convenient add-on service, while the competitive carrier must persuade
the customer to purchase a second line. In comparison, consumers that
desire to obtain xDSL service from competitive LECs must encounter
complications and expenses, including the need to arrange for a
technician to install service, that do not arise if they procure the
exact same service from the incumbent LEC. Providing competitive LECs
with access to the high frequency portion of the loop would remove that
additional burden from consumers that prefer to obtain xDSL service
from competitors.
18. The Third R&O is not inconsistent with the Commission's
decision to decline to unbundle packet switching. Self-provisioning
switches is vastly easier, less expensive, less time consuming, less
complicated, and less risky than self-provisioning the outside plant
that constitutes the ubiquitous loop network. There can be little
dispute that requesting carriers have not duplicated the incumbent
LEC's ubiquitous loop plant and generally are not providing service
with competitive loop facilities.
[[Page 1334]]
19. The Third R&O concludes that if competitive LECs were to
provide voice service in addition to xDSL-based service, they would be
impaired in their ability to provide the data services they seek to
offer. First, concluding that competitive LECs should be able to
provide voice service on the customer's first line would impose on
requesting carriers all of the cost and operational issues associated
with providing circuit-switched voice services. To the extent the
competitive carrier invests in its own switching facilities, it would
face cost and operational impairments associated with collocation and
the coordinated cutover process. Competitive carriers providing voice
service would also incur the costs of providing E911 service and number
portability.
20. Furthermore, the Third R&O finds that requiring competitive
LECs to provide voice services could require large investments in
circuit switching network architectures that may have little to do with
a requesting carrier's intention to offer advanced data services.
Investments in circuit switched networks may only be justified by
carriers that have attained sufficient scale and scope economies to
justify deploying large-scale circuit switched networks. For other
entrants, requiring this investment diverts financial resources and
management focus away from competitive LECs' ability to offer advanced
services and frustrates a requesting carrier's plan to migrate
telecommunication services from circuit switched to packet switched
networks. Frustrating the development of packet switched networks
capable of bringing advanced telecommunications capability to all
Americans is wholly inconsistent with the goals of section 706 of the
1996 Act and the deployment of efficient networks.
21. The Third R&O finds that despite its ability to purchase
transmission facilities from the incumbent to provide voice service, a
competitor is still impaired if it must provide analog voice service in
order to enter the market for voice-compatible xDSL services. There are
additional costs associated with being a provider of voice service than
the cost of the circuit switches. In particular, a competitive carrier
would need to develop marketing, billing, and customer care
infrastructure designed to service the needs of its voice customers. In
addition, competitive LECs seeking to enter the traditional voice
services market must deploy sales and marketing forces, and invest in
creating a recognizable brand. To compete against incumbent LECs that
have a long history providing voice services, competitors must overcome
the substantial goodwill, experience and market power of the incumbent
LECs. These factors make it a considerable challenge for competitive
LECs to motivate a consumer to adopt a new local exchange provider that
offers much the same service that the consumer already receives from
the incumbent LEC.
22. The Third R&O finds that competitive LECs would be impaired
even if they attempted to provide multi-service offerings including
voice-compatible xDSL services. In addition, it is likely that
competitive market entry would take longer to accomplish because
competitors would need to develop all of these additional capabilities.
To be sure, competitive LECs may well decide to diversify their
offerings at some point in the future. But such action should occur in
response to marketplace forces, not regulatory fiat. To conclude
otherwise would be to ignore the statutory directive in section
251(d)(2) that requires the Commission to consider whether a requesting
carrier is impaired ``to provide the services that it seeks to offer.''
23. The Third R&O's unbundling analysis acknowledges that
requesting carriers may address the impairment they face in the absence
of line sharing by capturing their own efficiencies and offering
integrated or innovative product offerings to customers. For example,
in the absence of line sharing, requesting carriers could offer
multiple services, such as voice and data, over a single loop to
capture the additional revenues associated with local and long distance
voice services. Alternatively, requesting carriers could offer
innovative bundles of services to customers to counter an incumbent LEC
who provides voice and data services on a single loop. The unbundling
analysis, however, favors an analytical approach that considers the
totality of the circumstances a requesting carrier will face, rather
than a specific business case analysis, to determine whether lack of
access to particular network elements materially diminishes a
requesting carrier's ability to provide the services it seeks to offer.
The Third R&O does not rely upon the presence of a particular
innovative business plan as a response to whether a requesting carrier
is impaired because of the variety and difficulty of predicting the
success of such a plan. The Third R&O concludes that a requesting
carrier's ability to spread the costs of a loop between multiple
services fully addresses a requesting carrier's impairment without
access to line sharing.
24. The Third R&O concludes that requesting carriers are not
presently obtaining the high frequency portion of the loop from third-
party sources rather than from an incumbent LEC under the section
251(c) unbundling obligation.
25. The Third R&O states that the Commission will reexamine the
national list of network elements that are subject to the unbundling
obligations of the Act every three years.
26. The Third R&O concludes that there are no bona fide issues of
technical feasibility with regard to line sharing. The local loop can
support transmissions on a wide range of frequencies. Analog voice
service occurs on the lower ``voiceband'' frequency range, at least
between 300 Hertz and 3,000 Hertz, and possibly up to 3,400 Hertz
depending on equipment and facilities. Some forms of xDSL, such as ADSL
use a higher frequency range, generally above 20,000 Hertz, that does
not interfere with voiceband transmissions. xDSL services that do not
use the voiceband frequency range can ``share'' a copper loop with
voiceband services, such as POTS, without impairing the performance of
either service. Therefore, the customer purchasing the xDSL service may
continue to receive analog circuit-switched POTS from the incumbent
LEC.
27. xDSL service can be added to a local loop that is being used
for ``traditional'' voice service by deploying special equipment at
each end of the subscribing customer's local loop. Specifically,
passive signal filters, or ``splitters,'' are installed at each end of
the customer's loop to accomplish this operation. One splitter is
installed at the customer's premises, and another at the central office
or remote terminal. A splitter bifurcates the digital and voiceband
signals concurrently traversing the local loop, directing the voiceband
signals through a pair of copper wires to the Class 5 switch, and
directing the digital traffic though another pair of copper wires to a
DSLAM attached to the packet-switched network.
28. The Third R&O finds that incumbents that provide their own xDSL
services on the same line that they are providing analog voice service
are utilizing the single copper pair in the same manner as if the
incumbent's voice service shared the line with a competitive carrier's
data service. Accordingly, the Third R&O requires incumbent LECs to
provide access to the high frequency portion of the loop based on the
criteria for presumed acceptability for deployment on shared lines. By
requiring conformance with this criteria, the Third R&O ensures that
competitive LECs utilize technology that
[[Page 1335]]
does not interfere with analog voice frequencies.
29. Voice-Compatible Forms of xDSL. The Third R&O requires
incumbent LECs to provide unbundled access to the high frequency
portion of the loop to any carrier that seeks to deploy any version of
xDSL that is presumed to be acceptable for shared-line deployment in
accordance with Commission rules. xDSL technologies that meet this
presumption include ADSL, as well as Rate-Adaptive DSL and Multiple
Virtual Lines (MVL) transmission systems, all of which reserve the
voiceband frequency range for non-DSL traffic. Among these, ADSL is the
most widely deployed version of xDSL that is currently presumed
acceptable for deployment on a shared line. Because line sharing as
contemplated in the Third R&O can occur only on lines that carry
traditional analog voiceband service, lines that are not used for these
services could not be shared.
30. Incumbent Remains the Voice Carrier. The Third R&O does not
require incumbents to provide unbundled access to carriers seeking just
the data portion of an otherwise unoccupied loop (often referred to as
a ``dry loop.'') In the event that the customer terminates its
incumbent LEC provided voice service, for whatever reason, the
competitive data LEC is required to purchase the full stand-alone loop
network element if it wishes to continue providing xDSL service.
Similarly, incumbent carriers are not required to provide line sharing
to requesting carriers that are purchasing a combination of network
elements known as the platform. In that circumstance, the incumbent no
longer is the voice provider to the customer.
31. Single Requesting Carrier, One Customer Per Loop. The Third R&O
defines the unbundling obligations to permit only a single competitor
to share the line with the incumbent. Moreover, the Third R&O does not
establish multiple customer line sharing requirements.
32. Control of the Loop and Splitter Functionality. The Third R&O
concludes that, subject to certain obligations, incumbent LECs may
maintain control over the loop and splitter equipment and functions.
Incumbent LEC seeking to maintain control of the splitter must promptly
accommodate, in response to a competitive LEC request to do so, any
line sharing technology that meets the deployment criteria established
in this proceeding. It finds that incumbent LECs will not delay their
actions to procure the necessary equipment, and will inform the
requesting carrier of what action it takes, and when the equipment can
be installed. It should take no longer to obtain and install such
equipment in response to a competitive LEC's request than it would take
the incumbent to procure and install the same equipment for itself. Any
failure to make this accommodation in a reasonably prompt manner would
constitute a violation of the incumbent LEC's section 251 unbundling
obligations.
33. The Third R&O finds that if a state commission finds that an
incumbent has unreasonably refused to accommodate the competitive LEC's
preferred technology or requested equipment upgrades in a prompt
fashion, the state commission may authorize the competitive LEC to
purchase and collocate its own splitter, whether or not incorporated
into the DSLAM. The incumbent LEC would then receive the voiceband
signal by connecting to the competitive LEC's collocated splitter.
Alternatively, the state commission may authorize the competitive LEC
to purchase a splitter that complies with the deployment standards we
adopt in this Order, and transfer that splitter to the incumbent. Where
the competitive LEC obtains some degree of control over the splitter,
the state commission should ensure that the integrity of the incumbent
LEC's voice transmission's passing through the competitive LEC's
equipment and do not interfere with the performance of the incumbent
LEC's central office and network equipment.
34. Line Sharing Does Not Impede Incumbent LECs' Ability to Manage
the Loop Plant. The findings in the Third R&O do no restrain the
incumbent LEC, in the course of normal loop plant maintenance and
improvement activities, from migrating customers from copper to fiber
loop facilities. Where such activity takes place, however, the
competitor may be required to forego access to only the high frequency
portion of the loop serving that customer, and may have to obtain
access to the entire unbundled copper loop or find another alternative
to maintain service.
35. The Third R&O concludes that, except in specific circumstances,
incumbent LECs must condition loops to enable requesting carriers to
provide xDSL-based services on the same loops the incumbent is
providing analog voice service, regardless of loop length.
Specifically, the incumbent LEC is required to remove bridge taps,
filters, range extenders, and similar devices where a competitive
carrier requests unbundled access to the high frequency portion of the
local loop. Incumbent LECs are required to condition loops of any
length for which competing carriers have requested line sharing, unless
conditioning of that loop will significantly degrade the incumbent's
voice service as described below. It concludes, however, that if
conditioning a particular loop for shared-line xDSL will significantly
degrade that customer's analog voice service, incumbent LECs are not
required to condition that loop for shared-line xDSL.
36. The Third R&O requires that the incumbent refusing a
competitive carrier's request to condition a loop make an affirmative
showing to the relevant state commission that conditioning the specific
loop in question will significantly degrade voiceband services. The
incumbent LEC must also show that there is no adjacent or alternative
loop available that can be conditioned or to which the customer's
service can be moved to enable line sharing.
37. The Third R&O concludes that incumbent LECs should be able to
charge for conditioning loops when competitors request the high
frequency portion of the loop. The conditioning charges for shared
lines, however, should never exceed the charges incumbent LECs are
permitted to recover for similar conditioning on stand-alone loops for
xDSL services. Accordingly, the Third R&O concludes that if the
incumbent LEC seeks compensation from the requesting carrier for line
conditioning activities, or such activity will cause substantial loop
provisioning delays, the requesting carrier has the option of refusing,
in whole, or in part, to have the line conditioned. A requesting
carrier refusing some or all aspects of line conditioning will not,
however, lose its right of access to the high frequency portion of the
loop.
38. The Third R&O concludes that incumbents must provide unbundled
access to the high frequency portion of the loop at the remote terminal
as well as the central office. It applies a rebuttable presumption that
for carriers requesting unbundled access to the high frequency portion
of the loop, the subloop can be unbundled at any accessible terminal in
the outside loop plant. Where the parties are unable to forge an
agreement to facilitate line sharing where the customer is served by a
loop passing through a DLC, the incumbent carrier bears the burden of
demonstrating to the relevant state commission, in the course of a
section 252 proceeding, that it is not technically feasible to unbundle
the subloop to provide access to the high frequency portion of the
loop.
[[Page 1336]]
39. The Third R&O concludes that incumbent LECs have the capability
to accommodate the provisioning of the high frequency portion of the
loop as a network element. Where incumbent LECs provide shared-loop
xDSL services to their voice customers, either through their own
subsidiaries or in cooperation with an unaffiliated ISP, the incumbent
must resolve many of the same problems that they claim stand in the way
of providing competitors with access to the high frequency portion of
the loop.
40. Service Ordering. The Third R&O concludes that the type of
effort required for incumbent LECs to establish appropriate line
sharing ordering practices is incremental in nature, and does not
require a major development initiative. The OSS capabilities required
for incumbent LEC provision of shared-line xDSL services are
substantially similar to the OSS capabilities required for competitive
LEC provision of shared-line xDSL services, and could be easily adapted
to support unbundled access to the high frequency portion of the loop
network element.
41. The record shows that while changes to the existing fields on
the UNE order form/electronic order formats may appropriately involve
the OBF for coordination and standardization, incumbents already have
made interim modifications to accommodate their own ADSL products.
Thus, we conclude that the interim arrangements that the incumbents use
for themselves can be extended to competitive carriers as well.
42. A key ordering system function is establishing the records
necessary for customer service, trouble management, billing, and
inventory functions. The Third R&O observes that the incumbent LECs
already use two circuit or service numbers to track their own shared-
line xDSL services: (1) the existing telephone number to identify the
voice service; and (2) a circuit number to identify the xDSL service
sharing the line. It concludes that incumbent LECs can extend this
practice to accommodate two-carrier shared line access to the high
frequency portion of the loop network element. Specifically, incumbent
LECs can identify a line shared with a competitive LEC by cross-
referencing a circuit number with the POTS telephone number. Possible
methods for establishing this cross-reference include embedding the
telephone number in the incumbent-assigned circuit number or the
customer-assigned circuit number, adding it as a cross-reference to the
existing account number, making a notation in the remarks field, or by
establishing a new field and field identifier (FID). An incumbent LEC
could create two internal orders from a competitive LEC's order for
access to the high frequency portion of the local loop submitted using
the incumbent's UNE ordering process. In that case, one order would be
used to establish the requesting carrier's access to the high frequency
loop spectrum, and the other would be a record-type order to add line
sharing indicators to the customer's analog voice service account and
records. This system resembles those used for ``from'' and ``to''
orders to accommodate customers that change their address but want to
retain the same telephone number, as well as the system that incumbents
employ to respond to a customer's change to a competitive local service
provider.
43. Provisioning. The Third R&O does not require incumbents to
provide access to the high frequency portion of the loop for multiple
competitive carriers. It finds that incumbents will use much the same
inventory functionality to inventory unbundled access to the high
frequency portion of the loop whether for the purposes of providing
access to that network element to their competitors, or for themselves.
Otherwise, incumbents would have to undertake substantial rebuilds to
accommodate their own shared-line xDSL service offerings.
44. The Third R&O concludes that the capabilities already exist in
the Loop Facilities and Assignment Control System (LFACS) to inventory
and assign two services on one loop, and that with minor modifications,
incumbent LECs can easily use existing capabilities to inventory
services on a shared line. In light of the apparent availability of OSS
modifications that will satisfy incumbent LEC inventory needs, there is
no justification to withhold requesting carrier's access to the high
frequency portion of the loop while OSS modifications are implemented
to allow carriers to order line sharing through electronic interfaces.
The Third R&O urges the state commissions not to permit incumbent LECs
to delay the availability of access to the high frequency portion of
the loop while they implement automated OSS solutions, or to attribute
an unreasonable portion of incumbent LEC OSS development costs to our
spectrum unbundling requirements. The Third R&O expressly makes no
judgment, however, that such non-automated measures would constitute
nondiscriminatory access to OSS interfaces for the purposes of section
271 of the Act. It notes that a failure to implement OSS modifications
within the time frame we contemplate in this Order could be grounds for
finding that a BOC is not providing nondiscriminatory access to
unbundled network elements under section 271 of the Act.
45. Billing. The Third R&O finds that there is likely to be little,
if any, billing system impact resulting from the provision of unbundled
access to the high frequency portion of the loop.
46. Maintenance, Repair, and Testing. The Third R&O concludes that
current industry methods and procedures for customer service, line
maintenance, and service quality assurance can largely accommodate the
demands of line sharing between competitive LECs and incumbent LECs.
47. First, the Third R&O finds that the customer must be informed
that testing on one of their services will impact the other service
sharing the customer's line. The Third R&O finds that either the
incumbent or competitive LEC's customer service operations can provide
sufficient customer education on this issue.
48. The second loop testing issue, however, is more complex.
Specifically, both the incumbent and competitive LEC must have access
to the shared loop facility for testing, maintenance, and repair
activities. Assuming that the competitive LEC owns the DSLAM and
installs it in its collocation space in the incumbent LEC end office or
remote terminal, a splitter is required to isolate and direct the voice
service to the incumbent LEC voice switch and the xDSL service to the
competitive LEC's DSLAM. This splitter will likely be installed between
the MDF and the other central office equipment. In this configuration,
the incumbent LEC retains testing access to the outside part of the
loop through the voice switch. The competitive LEC, however, can only
access the high frequency portion of the loop at its DSLAM. This
precludes the competitive LEC from engaging in certain important types
of loop testing that require the competitive LEC to access the loop's
whole frequency range. The ability to perform this type of loop testing
is important for installation, maintenance, and repair activities in
both shared and non-shared line situations.
49. The Third R&O requires that incumbent LECs must provide
requesting carriers with access to the loop facility for testing,
maintenance, and repair activities. We require that, at a minimum,
incumbents must provide requesting carriers with loop access either
through a cross-connection at the competitor's collocation space, or
through a standardized interface
[[Page 1337]]
designed for to provide physical access for testing purposes. Such
access must be provided in a reasonable and nondiscriminatory manner.
An incumbent seeking to utilize an alternative physical access
methodology may request approval to do so from the state commission,
but must show that the proposed alternative method is reasonable,
nondiscriminatory, and will not disadvantage a requesting carrier's
ability to perform loop or service testing, maintenance, or repair. We
stress that incumbents may not use their control over loop testing
access points and mechanisms for anti-competitive or discriminatory
purposes, and that we will remain attentive and ready to respond to any
reported anti-competitive incidents relating to competitive LEC access
to loop testing mechanisms.
50. Customer Service, Troubleshooting, and Repair. The Third R&O
finds that maintenance, repair, and testing concerns can be handled by
utilizing similar methods and procedures to those that incumbent LECs
are implementing for the ordering and provisioning of other unbundled
network elements. Specifically, it finds that incumbent LECs already
have methods and procedures in place for the cooperative resolution of
trouble and testing problems that arise with competitive LECs, and that
these methods and procedures can easily be modified to include
provisions for escalating shared line trouble issues in a manner that
minimizes customer confusion.
51. Resolution of Operational Issues. The Third R&O finds that
incumbent LECs have already modified their OSS systems to accommodate
their own xDSL products, and that those modifications and those
required for line sharing are substantially similar. Incumbent LECs can
adapt expediently existing incumbent OSS systems to handle line sharing
with a single requesting carrier. The Third R&O also finds that
incumbent LECs can perform the incremental modifications to the
existing ordering processes required to provide competitive LECs with
access to the high frequency portion of the loop in an expedient manner
and at modest expense. It finds that in the absence of fully automated
OSS interfaces, incumbent LECs have a variety of means available with
which they can accommodate competitive LEC orders for the unbundled
high frequency portion of the local loop, including the use of manual
overrides of their current UNE ordering methods and procedures.
Accordingly, the Third R&O urges requesting carriers and incumbent LECs
to engage in a collaborative process at the regional level to develop
solutions to incumbent LEC provision of shared line access.
52. The Third R&O does not identify or require incumbent LECs to
make specific OSS methods and procedures, or facilities changes, and it
does not prejudge whether specific OSS functionalities are necessary to
fulfill an incumbent LEC's nondiscrimination duty. The Third R&O finds
that incumbent LECs should be able to develop and implement the
majority of systems modifications necessary to provide access to the
higher frequency portion of the loop 180 days from release of this
order. There are alternatives, to those system modifications that can
not be implemented in 180 days, and these alternatives can be deployed
in six months. Thus, the Third R&O concludes that incumbent LECs should
be able to implement system changes necessary to provide requesting
carriers with nondiscriminatory access to the high frequency portion of
the local loop within 180 days from release of the order.
53. The Third R&O finds that there are five types of direct costs
that an incumbent LEC potentially could incur to provide access to line
sharing: (1) loops; (2) OSS; (3) cross connects; (4) splitters; and (5)
line conditioning.
54. Local Loop. The Third R&O concludes that in arbitrations and in
setting interim prices, states may require that incumbent LECs charge
no more to competitive LECs for access to shared local loops than the
amount of loop costs the incumbent LEC allocated to ADSL services when
it established its interstate retail rates for those services.
55. OSS. The Third R&O finds that incumbent LECs should recover in
their line sharing charges those reasonable incremental costs of OSS
modification that are caused by the obligation to provide line sharing
as an unbundled network element. It also reaffirms that the states may
require incumbent LECs in an arbitrated agreement to recover such
nonrecurring costs such as these incremental OSS modification costs
through recurring charges over a reasonable period of time; and that
nonrecurring charges must be imposed in an equitable manner among
entrants.
56. Cross Connects. The Third R&O finds it reasonable for the
states to establish a presumption that, where the splitter is located
within the incumbent LECs' MDF, the cost for a cross connect for entire
loops and for the high frequency portions of loops should be the same.
It states that the states should examine carefully any assessment of
costs for cross connections for xDSL services that are in excess of the
costs of connecting loops to a competitive LECs' collocated facilities
where the splitter is located within the MDF. If the splitter is not
located within the incumbent LEC's MDF, however, then the states should
allow the incumbent LEC to adjust the charge for cross connecting the
competitive LEC's xDSL equipment to the incumbent LECs' facilities to
reflect any cost differences arising from the different location of the
splitter, compared to the MDF.
57. Splitters. The Third R&O concludes that if the incumbent LEC
purchases for a competitive LEC the same splitter that it uses itself
for providing xDSL services, then a state may require that it only
assess the competitive LEC the same amount that it itself pays for a
delivered splitter. The Third R&O further concludes that a competitive
LEC, at its option, should be allowed to purchase a splitter that
complies with industry standards, and transfer it to the incumbent LEC,
in the event that the competitive LEC can complete the transaction more
expeditiously or cost effectively than the incumbent LEC. A state may
also allow the incumbent LEC to include in its rate structure a charge
to recover the cost of installing the splitters.
58. Line Conditioning. In order to prevent incumbent LECs from
charging an excessive price for line conditioning, the Third R&O finds
that states may require that the conditioning charges for shared lines
not exceed the charges the incumbent LECs are permitted to recover for
similar conditioning of stand-alone loops for xDSL services.
Furthermore, if the incumbent LEC is providing, or has already
provided, xDSL service over a particular shared loop, a competitive LEC
should not be charged with any line conditioning costs if it wins that
customer and seeks access to that shared loop for providing xDSL
service. Thus, the Third R&O concludes that requiring line sharing and
pricing it on the basis of TELRIC should not affect the ability of the
incumbent LEC to recover costs associated with providing voice service.
59. Effective Date of New Rules. The rules established in the Third
R&O require that the unbundling of the high frequency portion of the
loop becomes effective February 9, 2000.
60. States' Role in Fostering Local Competition Under Sections 251
and 252. The Third R&O strongly encourages states to issue binding
interim arbitration awards that would require the incumbent to begin
provisioning this unbundled network element on interim arbitration
terms and conditions
[[Page 1338]]
within 180 days of release of the Third R&O. The state interim
arbitration award would remain in effect until such time as the state
issues a final award. The Third R&O states that in the event that a
state commission fails to take action in an arbitration proceeding
within the nine months prescribed by Congress, the Commission is
prepared to act promptly, pursuant to section 252(e)(5) and the
Commission's implementing rules, to issue an order ``preempting the
State commission's jurisdiction of that proceeding or matter'' and
thereafter to bring the arbitration to an orderly, expeditious
conclusion. Furthermore, noting that a few states already have taken
significant steps toward requiring incumbent LECs in their jurisdiction
to offer line sharing, the Third R&O emphasizes that the timetable it
outlines for implementing line sharing on a nationwide basis should be
viewed as a maximum period for states that have not yet taken any
actions to make line sharing available, and that the intention is not
to delay or constrain states that already have undertaken such
initiatives.
61. The Third R&O contemplates that such interim arbitration awards
would incorporate the rules adopted in the Third R&O and be
sufficiently detailed to permit the incumbent LECs to begin providing
this new unbundled network element immediately upon the effective date
of the interim order. The interim arbitration awards, like final
arbitration awards, should include the price of the high frequency
portion of the loop based on the pricing guidelines set out in the
Third R&O. The Third R&O encourages the states, when issuing their
interim arbitration awards, to set the price for the unbundled high
frequency portion of the loop at the amount that the incumbent assesses
in establishing interstate rates for its own competing services.
62. In addition to arrangements reached through section 252-
negotiation and arbitration procedures, Bell Operating Companies (BOCs)
may prepare and file with a state commission a statement of generally
available terms and conditions (SGAT) that they offer to comply with
the requirements of section 251. Pursuant to section 252(i),
competitive carriers will be able to obtain access to the high
frequency portion of the loop at the same rates, terms, and conditions
offered in any approved interconnection agreement, as well as the BOCs'
SGATs.
63. Duty to Negotiate in Good Faith. The Third R&O concludes that
as part of the incumbent LEC's duty to negotiate in good faith, upon
commencement of the negotiation process the incumbent LEC immediately
should make available a representative who has region-wide decision-
making authority to meet with the requesting carrier and any other
competitive carriers seeking shared line access in the incumbent LEC's
region at issue.
64. Guidelines for State Arbitration Awards. The Third R&O
encourages states to require, in arbitration proceedings, incumbent
LECs to fulfill requests for line sharing within the same interval the
incumbent provisions xDSL to its own retail or wholesale customers,
regardless of whether the incumbent uses an automated or manual
process. The Third R&O further urges states to adopt provisioning
intervals for this unbundled network element as part of any arbitration
award, whether interim or final. Because there are currently no state-
required provisioning intervals for the high frequency portion of the
loop network element, the Third R&O recommends that states consider a
standard based on the time required to provision xDSL capable loops.
Where the incumbent LEC is already providing shared line xDSL service
to a particular customer, however, the provisioning interval should be
significantly shorter.
65. The Third R&O strongly urges the states to adopt an
implementation schedule that requires an incumbent to begin
provisioning this network element to requesting carriers no later than
45 days after the issuance of an arbitration award. Finally, the Third
R&O encourages states to establish penalties for failure to meet
provisioning intervals as part of any arbitration award.
III. Spectrum Policy
66. Standards-Setting Entities. The Third R&O reiterates the
Commission's general belief that industry standards bodies can, and
should, create acceptable standards for deployment of xDSL-based and
other advanced services. Despite the neutrality and openness principles
embedded in the standards setting processes of standards body T1E1.4,
however, several parties continue to express concerns that T1E1.4 is
dominated by incumbent LECs and that, as a result, standards setting is
delayed and deployment of certain technologies particularly favored by
competitive LECs is precluded. Thus, the Third R&O concludes that the
Commission is compelled to play a role in standards development, and
that the standards setting process must include the involvement of a
third party to advise the Commission on spectrum compatibility
standards and spectrum management practices. Specifically, the charter
of an existing Federal Advisory Committee, the Network Reliability and
Interoperability Council (NRIC), will be amended to charge NRIC with
such an advisory function.
67. NRIC V is requested to provide initial recommendations for
resolution of spectrum compatibility and management issues to the
Commission within 150 days from the establishment date of NRIC V.
Moreover, NRIC is expected to submit reports to the Commission on
standards and practices development issues as further deemed necessary
by NRIC or the Commission and, in any event, promptly after NRIC has
received appropriate input from industry standards bodies.
68. The Third R&O anticipates that NRIC will receive the majority
of input from, and monitor most closely, the work of T1E1.4 with
respect to developing spectrum compatibility standards, and with
respect to fair and open practices for the deployment of advanced
services technologies. The Third R&O emphasizes, however, that NRIC
will be open to, and will consider submissions from, any appropriate
industry standards body. Through the recommendations and reports that
the Commission receives from NRIC, the Commission will evaluate whether
T1E1.4 and other industry standards bodies are acting in a manner
consistent with the policies that the Commission has determined should
underlie spectrum compatibility standards-setting and formation of
spectrum management rules and practices. Should the Commission find
that certain industry standards bodies are adopting spectrum
compatibility standards or spectrum management practices that continue
to fail, in their underlying processes, in safeguarding principles of
competitive neutrality and promoting innovation, the Commission will
look to other industry standards bodies that uphold these principles,
or the Commission will exercise its authority to assume the standards-
setting function itself.
69. Mechanisms for Demonstrating Spectrum Compatibility. In the
first order in this proceeding (Advanced Services First Report and
Order, 14 FCC Rcd 4761 (1999)), the Commission sought comment on the
best means to address spectrum compatibility. The Third R&O declines to
adopt a federal rule mandating the use of either generic PSD masks or a
calculation-based approach. Instead, it defers to the conclusions to be
reached by industry standards-setting bodies on this issue.
70. Notwithstanding the Commission's abstention from adopting a
federal rule governing methods for defining spectrum compatibility, the
Third R&O observes that the use both of
[[Page 1339]]
generic PSD masks and a calculation-based approach appear to be the
best means to address spectrum compatibility for purposes of spurring
competition.
71. Conditions for Acceptability of a Loop Technology for
Deployment. The Advanced Services First Report and Order concluded
that, ``until long-term standards and practices can be established,'' a
loop technology should be presumed acceptable for deployment under any
one of several circumstances. These circumstances include that the
technology: (1) Complies with existing industry standards; (2) is
approved by an industry standards body, the Commission, or any state
commission; or (3) has been successfully deployed by any carrier
without ``significantly degrading'' the performance of other services.
The Third R&O codifies these presumptions and clarifies certain aspects
of them.
72. The Third R&O reaffirms the conclusion from the Advanced
Services First Report and Order that ADSL, HDSL, and ISDN services are
presumed acceptable for deployment on fully unbundled loops where they
comply with any one of certain enumerated standards. Similarly, in
accordance with the second and third criteria outlined above, the Third
R&O declares SDSL to be presumed acceptable for deployment. This
finding, however, is limited to presuming SDSL acceptable for
deployment on a fully unbundled loop. The Third R&O does not establish
a presumption that SDSL is acceptable for deployment on a shared loop.
73. The Third R&O concludes that a competing carrier's use of the
calculation-based method for demonstrating spectrum compatibility, as a
prelude in most cases to initial deployment of a technology, should go
far towards allaying the concerns of some commenters over risks of
interference to the network from the deployment of a technology that
was successfully deployed elsewhere. The LEC also will be able to rebut
the presumption of acceptability before a state commission if the
technology proposed for deployment poses a real interference threat in
a certain area.
74. Consistent with the information disclosure requirements that
were applied to incumbent LECs in the Advanced Services First Report
and Order, the Third R&O finds that competitive LECs must provide to
incumbent LECs information on the type of technology that they seek to
deploy. The Third R&O concludes further that competitive LECs must
provide this information in notifying the incumbent LEC of any proposed
change in advanced services technology that the carrier uses on the
loop.
75. The Third R&O reaffirms the subjective definition of
``significantly degrade'' that was adopted in the Advanced Services
First Report and Order, namely, ``an action that noticeably impairs a
service from a user's perspective.'' The Third R&O reiterates that
where a carrier claims that a deployed service is significantly
degrading the performance of other advanced services or traditional
voice band services, that carrier must notify the deploying carrier and
allow the deploying carrier a reasonable opportunity to correct the
problem. Any claims of network harm presented to the deploying entity
or, if subsequently necessary, the relevant state commission, must be
supported with specific and verifiable corroborating information.
76. The Third R&O confirms that an incumbent LEC need not act as
the initial point of contact in all service degradation disputes.
Instead, the carrier that believes its services are being significantly
degraded should notify the causing carrier when the carrier
experiencing degradation knows with certainty the identity of the
causing carrier. The Third R&O recognizes that a carrier whose services
are being degraded may not know the precise cause of the degradation
and thus may not know which carrier to contact for corrective action.
In this circumstance, the carrier experiencing service degradation must
notify each carrier that may have caused or contributed to the
degradation, including, where applicable, the incumbent LEC. Where the
carrier experiencing service degradation does not know which carriers
share the binder group or have deployed services in an adjacent binder
group, it should request that the incumbent LEC provide it with the
relevant contact information for those other carriers.
77. The Third R&O reaffirms and codifies the policy enunciated in
the Advanced Services First Report and Order 63 FR 4420 August 18,
1998, to guide states in the resolution of interference disputes.
Specifically, where a LEC demonstrates that a deployed technology is
significantly degrading the performance of other advanced services or
traditional voice band services, ``the carrier deploying the technology
shall discontinue deployment of that technology and migrate its
customers to technologies that will not significantly degrade the
performance of other such services.'' The Third R&O adds an exception
to this rule that the Commission believes will further safeguard
competitive neutrality and deployment of new technologies.
Specifically, where the only interfered-with service itself is a known
disturber, that service shall not prevail against the newly deployed
technology.
78. Binder Group Management. The Third R&O concludes that the only
permissible forms of binder group management are the segregation of
known disturbers and the use of the interference protection techniques
described above. Currently, the only technology that the Third R&O
finds causes interference with sufficient persistence to rise to the
level of a known disturber is analog T1. Because the designation of a
technology as a known disturber impacts various national-level rules
and policies, such as those governing interference dispute resolution
and binder group management, and also triggers the determination by
states of how the known interfering technology will be disposed, the
Commission will decide which technologies should be considered as known
disturbers.
79. The Third R&O limits segregation practices to known disturbers
because only the interference risks of mixing known disturbers with
other technologies outweigh the risks of anticompetitive segregation
practices. Because the Commission currently does not determine ADSL to
be a known disturber, the Third R&O finds that SBC may not implement
SFS, a form of binder group management that segregates ADSL. SBC and
any other carrier currently implementing any prohibited binder group
management techniques, including SFS, must discontinue and dismantle
such implementations within 60 days after the release of the Third R&O.
80. The Third R&O concludes that the states should determine
disposition of known interfering technologies. The Third R&O further
finds that leaving disposition of known interfering technologies to the
states is preferable to establishing a national sunset period for known
disturbers in this proceeding.
IV. Other Issues
81. State Authority to Enact Additional Line Sharing Requirements.
In conformance with the rule established in the Third Report and Order
in CC Docket No. 96-98 (Local Competition Third Report and Order), the
Third R&O does not permit the states to reduce the unbundling
obligations established in the Third R&O. States may enact additional
or modified unbundling requirements only to the same extent that they
are
[[Page 1340]]
permitted to do so in the Local Competition Third Report and Order. Any
state that imposes unbundling requirements in contravention of section
253(a) of the Act will be subject to possible preemption by the
Commission under section 253(d) of the Act. Moreover, the Third R&O
declines to exempt rural incumbent LECs from the line sharing
unbundling obligation, but notes that states retain the authority
pursuant to section 251(f) of the Act to exempt certain rural LECs from
all section 251 obligations.
82. Takings. The Third R&O disagrees with US WEST's
characterization that declaring the high frequency portion of the local
loop to be an unbundled network element results in a physical taking.
As the Commission previously has stated in the Local Competition Third
Report and Order, dedicating a particular element to the new entrant's
exclusive use does not effect a physical occupation of any incumbent
LEC's property because the incumbent LEC retains physical dominion over
their network elements. Requesting carriers are simply permitted to
send their communications over these elements. Moreover, to the extent
requiring incumbent LECs to provide access to network elements could be
characterized as a regulatory or physical taking, incumbent LECs have
an adequate means available to secure just compensation. Thus, the
Third R&O concludes that even if requiring incumbent LECs to provide
competitive LECs with access to the unbundled high frequency spectrum
of the local loop constitutes a taking under the Fifth Amendment, this
taking is not unconstitutional.
V. Final Regulatory Flexibility Analysis
83. As required by the Regulatory Flexibility Act (RFA), an Initial
Regulatory Flexibility Analysis (IRFA) was incorporated in the Advanced
Services First Report and Order and FNPRM. The Commission sought
written public comment on the proposals in the Advanced Services First
Report and Order and FNPRM, including comment on the IRFA. This present
Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.
Need for and Objectives of This Third Report and Order and the Rules
Adopted Herein
84. In this Third Report and Order (Order), the Commission takes
additional, important steps toward implementing Congress' goals for
deployment of advanced services by requiring incumbent LECs to unbundle
the high frequency portion of the loop, and establishing spectrum
compatibility and management policies.
85. First, the Commission amends our unbundling rules to require
incumbent LECs to provide unbundled access to a network element, the
high frequency portion of the loop. This will enable competitive LECs
to provide xDSL service through telephone lines that they share with
incumbent LECs, which is frequently called ``line sharing.'' In order
to ensure that line sharing does not significantly degrade analog voice
service, incumbents must provide unbundled access to the high frequency
portion of the loop only to carriers seeking to provide xDSL services
that meet one of the Commission's criteria regarding the presumption of
acceptability for deployment on the same loop as analog voice service.
86. The Commission also set specific parameters for line sharing
deployment in order to ensure that the analog voiceband is preserved
from significant degradation. Incumbents are not required to provide
unbundled access to the high frequency portion of the loop if they are
not currently providing analog voice service to the customer. Moreover,
incumbent carriers must provide unbundled access to the high frequency
portion of the loop to only a single requesting carrier, for use at the
same customer address as the analog voice service provided by the
incumbent. In addition, subject to certain obligations, incumbent LECs
may maintain control over the loop and splitter equipment and
functions.
87. The Commission also set forth pricing methodologies for the
states to use as guidelines when setting the price of this new
unbundled network element. Based on the record, we find that there are
five types of direct costs that an incumbent LEC potentially could
incur to provide access to line sharing : (1) loops; (2) OSS; (3) cross
connects; (4) splitters; and (5) line conditioning.
88. In addition to line sharing requirements, we adopt rules in
this Order that apply to spectrum compatibility and management. These
rules will significantly benefit the rapid and efficient deployment of
xDSL technologies. Specifically, the Commission seeks to encourage the
voluntary development of industry standards while limiting the ability
of any one class of carriers to impose unilateral and potentially anti-
competitive spectrum management or compatibility rules on other xDSL
providers. We believe that spectrum policies we adopt in this Order
will ensure the compatibility of technologies and minimize the risk of
harmful spectrum interference among transmission services. As such,
these policies will ensure that American consumers will not face undue
delay in receiving the benefits of technological innovation.
89. The Commission also adopts rules that will govern when a loop
technology is presumed acceptable for deployment. The circumstances
include when the technology: (1) complies with existing industry
standards; (2) has been approved by an industry standards body, the
Commission, or any state commission; or (3) has been successfully
deployed by any carrier without significantly degrading the performance
of other services.
90. The Commission affirms our conclusions from the Advanced
Services First Report and Order regarding resolution of interference
disputes. In the event that a LEC demonstrates to the relevant state
commission that a deployed technology is significantly degrading the
performance of other advanced services or traditional voice band
services, the carrier deploying the technology shall discontinue
deployment of that technology and migrate its customers to technologies
that will not significantly degrade the performance of other services.
We now adopt an exception to this rule: where the only service
experiencing interference is itself a known disturber, that service
shall not prevail against the newly developed technology. We conclude
that analog T1 service is a known disturber.
91. The only permissible forms of binder management are the
segregation of known disturbers and the use of the spectrum
compatibility (interference protection) techniques described above. The
states may select one or more of several approaches towards disposition
of known disturbers, including segregation or sunsetting of known
disturbers.
Summary of Significant Issues Raised by Public Comments in Response to
the IRFA
92. In the IRFA, the Commission stated that any rule changes would
impose minimum burdens on small entities, and solicited comment on
alternatives to our proposed rules that would minimize the impact they
might have on small entities. The Office of Advocacy, United States
Small Business Administration (SBA), commented on the issues raised in
the First Report and Order and Further Notice of Proposed Rulemaking.
SBA argued that the Commission should consider all comments received in
response to the FNPRM, but also issue a second Further
[[Page 1341]]
Notice along with a revised IRFA that more accurately identifies all
small businesses impacted and details the compliance burdens. Moreover,
SBA is concerned that the Commission did not provide adequate notice
regarding cost allocation and operational issues.
93. First, SBA argues that the Advanced Services FNPRM does not
adequately identify all small entities affected by the line sharing and
spectrum management proposals because the Commission did not identify
small incumbent LECs as small entities. In fact, the Commission does
include small incumbents in its RFA. While in the IRFA, the Commission
stated that ``[a]lthough some affected incumbent LECs may have 1,500 or
fewer employees, we do not believe that such entities should be
considered small entities within the meaning of the RFA because they
are either dominant in their field of operations or are not
independently owned and operated, and therefore by definition not
`small entities' or `small business concerns' under the RFA,'' the
Commission goes on to state that ``[o]ut of an abundance of caution,
however, for regulatory flexibility analysis purposes, we will
separately consider small incumbent LECs within this analysis and use
the term `small incumbent LECs' to refer to any incumbent LECs that
arguably might be defined by the SBA as `small business concerns.' ''
Moreover, as SBA is aware, the Commission continues formally to include
small incumbent LECs in the RFA analysis of recent Commission items.
94. SBA also argues that the IRFA does not describe the possible
reporting, recordkeeping, and other compliance requirements stemming
from the proposals in the Advanced Services FNPRM. The Commission
determined in the Advanced Services FNPRM that line sharing is
technically feasible and requested comments on the operation issues
relating to sharing a single line between two service providers. In
addition, the Commission sought comment on additional measures the
Commission could take to ensure that spectrum compatibility and
management concerns are resolved in a fair and expeditious manner. The
Commission sought comment on these two issues, and specifically
identified issues such as the economic, pricing, and cost allocation
implications of the line sharing proposals, as well as the burdens on
the industry created by our spectrum policy proposals. As stated in the
IRFA, we sought ``comments on whether the Commission should establish
rules for deployment of central office equipment similar to those set
forth in part 68 of our rules. We also ask[ed] commenters to address
whether the Commission should be involved with the actual testing and
compliance procedures or whether the industry is better suited to serve
this function through the use of independent and accredited labs.'' The
commenters in this proceeding addressed these specific issues in a
detailed manner, including any reporting, recordkeeping, and other
compliance requirements associated with the proposals, suggesting that
the Commission proposals were neither vague not insufficient as alleged
by SBA.
95. Third, SBA contends that the Commission's IRFA did not discuss
any alternatives to the proposals made in the Advanced Services FNPRM,
and that the Commission's claim that the proposals placed a minimum
burden on small entities is unsupported by any analysis of the burdens.
In the IRFA, the Commission sought ``to develop a record sufficient
enough to adequately address issues related to developing long-term
standards and practices for spectrum compatibility and management, and
to the sharing of loops by multiple providers.'' In addressing these
issues, the Commission sought to ensure that competing carriers,
including small entity carriers, obtain access to inputs necessary to
the provision of advanced services. We also tentatively concluded that
our proposals in the FNPRM would impose minimal burdens on small
entities. Moreover, we sought comment on these proposals and the impact
they may have on small entities.''
96. Although the Commission did not describe explicitly each of the
alternatives that we considered and rejected, as the proposals in the
Advanced Services FNRPM make clear, the Commission is not considering
proposals that would require small entities to engage in activities in
which they are not already required to engage. These activities might
require operational, accounting, billing, and legal skills that the
small carriers already have. Moreover, certain proposals in the
Advanced Services FNPRM clearly would benefit all carriers, including
small carriers, by ensuring that all carriers have economic incentives
to innovate and invest in new technologies. This document notes that in
the text of the Advanced Services FNPRM, the Commission, in many
instances, raised questions regarding alternatives to our proposals.
These alternatives have the potential to benefit small entities. While
the Commission did not reiterate each of these questions in the IRFA,
we did describe our actions in the IRFA, which was attached as an
Appendix to the Advanced Services FNPRM, and as such, we provided
sufficient notice for small entities.
VI. Description and Estimate of the Number of Small Entities Affected
by the Third Report and Order
97. In the RFA to the Commission's Advanced Services Order and
FNPRM, we adopted the analysis and definitions set forth in determining
the small entities affected by this order for purposes of this FRFA.
The RFA directs agencies to provide a description of and, where
feasible, an estimate of the number of small entities that will be
affected by rules. The RFA generally defines ``small entity'' as having
the same meaning as the term ``small business,'' ``small
organization,'' and ``small governmental jurisdiction.'' In addition,
the term ``small business'' has the same meaning as the term ``small
business concern'' under the Small Business Act, unless the Commission
has developed one or more definitions that are appropriate to its
activities. Under the Small Business Act, a ``small business concern''
is one that: (1) is independently owned and operated; (2) is not
dominant in its field of operation; and (3) meets any additional
criteria established by the Small Business Administration (SBA). The
SBA has defined a small business for Standard Industrial Classification
(SIC) categories 4812 (Radiotelephone Communications) and 4813
(Telephone Communications, Except Radiotelephone) to be small entities
when they have no more than 1,500 employees. We first discuss the
number of small telephone companies falling within these SIC
categories, then attempt to refine further those estimates to
correspond with the categories of telephone companies that are commonly
used under our rules.
98. The most reliable source of information regarding the total
numbers of common carrier and related providers nationwide, as well as
the numbers of commercial wireless entities, appears to be data the
Commission publishes annually in its Carrier Locator report, derived
from filings made in connection with the Telecommunications Relay
Service (TRS). According to data in the most recent report, there are
3,604 interstate carriers. These carriers include, inter alia, local
exchange carriers, wireline carriers and service providers,
interexchange carriers, competitive access providers, operator service
providers, pay telephone operators, providers of telephone toll
service, providers of telephone exchange service, and resellers.
[[Page 1342]]
99. The Commission has included small incumbent LECs in the present
RFA analysis. As noted above, a ``small business'' under the RFA is one
that, inter alia, meets the pertinent small business size standard
(e.g., a telephone communications business having 1,500 or fewer
employees), and ``is not dominant in its field of operation.'' The
SBA's Office of Advocacy contends that, for RFA purposes, small
incumbent LECs are not dominant in their field of operation because any
such dominance is not ``national'' in scope. We have therefore included
small incumbent LECs in this RFA analysis, although we emphasize that
this RFA action has no effect on FCC analyses and determinations in
other, non-RFA contexts.
100. Total Number of Telephone Companies Affected. The United
States Bureau of the Census (``the Census Bureau'') reports that, at
the end of 1992, there were 3,497 firms engaged in providing telephone
services, as defined therein, for at least one year. This number
contains a variety of different categories of carriers, including local
exchange carriers, interexchange carriers, competitive access
providers, cellular carriers, mobile service carriers, operator service
providers, pay telephone operators, PCS providers, covered SMR
providers, and resellers. It seems certain that some of those 3,497
telephone service firms may not qualify as small entities or small
incumbent LECs because they are not ``independently owned and
operated.'' For example, a PCS provider that is affiliated with an
interexchange carrier having more than 1,500 employees would not meet
the definition of a small business. It seems reasonable to conclude,
therefore, that fewer than 3,497 telephone service firms are small
entity telephone service firms or small incumbent LECs that may be
affected by the decisions and rules proposed in the Notice.
101. Wireline Carriers and Service Providers. SBA has developed a
definition of small entities for telephone communications companies
other than radiotelephone companies. The Census Bureau reports that,
there were 2,321 such telephone companies in operation for at least one
year at the end of 1992. According to SBA's definition, a small
business telephone company other than a radiotelephone company is one
employing no more than 1,500 persons. All but 26 of the 2,321 non-
radiotelephone companies listed by the Census Bureau were reported to
have fewer than 1,000 employees. Thus, even if all 26 of those
companies had more than 1,500 employees, there would still be 2,295
non-radiotelephone companies that might qualify as small entities or
small incumbent LECs. Although it seems certain that some of these
carriers are not independently owned and operated, we are unable at
this time to estimate with greater precision the number of wireline
carriers and service providers that would qualify as small business
concerns under SBA's definition. Consequently, the Commission estimates
that there are fewer than 2,295 small entity telephone communications
companies other than radiotelephone companies that may be affected by
the decisions and rules proposed in the Notice.
102. Local Exchange Carriers. Neither the Commission nor SBA has
developed a definition of small local exchange carriers (LECs) or
competitive local exchange carriers (CLECs). The closest applicable
definition for these carrier-types under SBA rules is for telephone
communications companies other than radiotelephone (wireless)
companies. The most reliable source of information regarding the number
of these carriers nationwide of which the Commission is aware appears
to be the data that we collect annually in connection with the
Telecommunications Relay Service (TRS). According to our most recent
data, there are 1,410 LECs, 129 CLECs, and 351 resellers.
103. Although it seems certain that some of these carriers are not
independently owned and operated, or have more than 1,500 employees, we
are unable at this time to estimate with greater precision the number
of these carriers that would qualify as small business concerns under
SBA's definition. Consequently, we estimate that there are fewer than
1,410 small entity LECs, 129 CLECs, and 351 resellers that may be
affected by the decisions and rules adopted in the Order.
Summary of Projected Reporting, Recordkeeping, and Other Compliance
Requirements
A. Line Sharing
104. The Commission set forth guidelines that states may use in
pricing the higher frequencies of their local loops, which will be made
available as an unbundled network element. The Commission determined
that complying with these guidelines may require use of operational,
accounting, billing, and legal skills. These are skills that the
carriers already have. The Commission believes, however, that incumbent
LECs will already have these skills. The burden of compliance is
minimal because they use the higher frequencies of their local loops
already to provide the service that will be offered to others pursuant
to the unbundled network element.
105. In this Order, we identify the high frequency portion of the
loop as an additional network element that incumbent LECs are obligated
to offer to requesting carriers on an unbundled basis nationwide. The
Commission believes that incumbent LECs already have the skills
necessary to accomplish this with little or no additional resources
because incumbents will not have to hire new staff, or provide
additional training to current staff. The Commission notes that,
pursuant to section 251(c) and (d) of the 1996 Act, incumbent LECs,
including those that qualify as small entities, are required to provide
nondiscriminatory access to unbundled network elements. The only
exception to this rule apply to those carriers that qualify for and
have obtained an exemption, suspension, or modification pursuant to
section 251(f) of the Act.
B. Spectrum Policy
106. The Commission requires competitive LECs to provide to
incumbent LECs information on the type of technology they seek to
deploy, including Spectrum Class information where a competitive LEC
asserts that the technology it seeks to deploy fits within a generic
power spectral density (PSD) mask. Where a competitive LEC relies on a
calculation-based approach to support deployment of a particular
technology, it must furnish the incumbent LEC with information on the
speed and power at which the technology will be transmitted.
Competitive LECs must provide this information in notifying the
incumbent LEC of any proposed change in advanced services technology
that the carrier uses on the loop, so that the incumbent LEC can
correct its records and anticipate the effect that the change may have
on other services in the same or adjacent binder groups. The provision
of such information is integral to a competitive LEC's claim that the
technology it seeks to deploy is presumed acceptable for deployment.
The Commission determined that complying with these rules may require
use of engineering, technical, operational, and legal skills.
[[Page 1343]]
Steps Taken To Minimize Significant Economic Impact on Small Entities
and Small Incumbent LECs, and Alternatives Considered
A. Line Sharing
107. The high frequency portion of the loop meets the statutory
definition of a network element and must be unbundled pursuant to
sections 251(d) and (c)(3). Our unbundling analysis benefits
competitive carriers, including small entities, by enabling the
carriers to have access to shared loops in order to serve customers
who, heretofore, it has been uneconomical to serve. In order to ensure
that line sharing does not significantly degrade analog voice service,
incumbents must provide unbundled access to the high frequency portion
of the loop only to carriers seeking to provide xDSL-based service that
meets one of the Commission's criteria regarding the presumption of
acceptability for deployment on the same loop as analog voice service.
Incumbent carriers must provide unbundled access to the high frequency
portion of the loop only to a single requesting carrier, for use at the
same customer address as the analog voice service provided by the
incumbent. Incumbents are not required to provide unbundled access to
the high frequency portion of the loop if they are not currently
providing analog voice service to the customer. Subject to certain
obligations, incumbent LECs may maintain control over the loop and
splitter equipment and functions. The specific parameters pursuant to
which incumbent LECs have to provide access to shared lines benefit
small entities, both incumbent and competitive carriers, by ensuring
that carriers do not have to devote scarce resources to address line
sharing arrangements, such as multiple carriers and multiple customers
on the same loop, in which it is unlikely carriers seek to engage.
108. Moreover, the record shows that incumbents should be able to
resolve operational issues associated with implementation of line
sharing, including modifications to operations support systems, within
six months. The record shows that incumbents have a number of process
alternatives available and we will allow them the flexibility to choose
the best and most economically feasible of them. The 180-day
implementation period will benefit small incumbents who might not have
the resources to make immediate changes to their OSSs.
Spectrum Policy
109. Although we reiterate our general belief that industry
standards bodies should create acceptable standards for deployment of
advanced services, we remain convinced, however, that the Commission is
compelled to play a role in fostering timely, fair, and open
development of standards for current and future technologies. We
conclude that the standards setting process must include the
involvement of a third party to advise the Commission on spectrum
compatibility standards and spectrum management practices.
Specifically, the charter of an existing Federal Advisory Committee
(FAC), the Network Reliability Interoperability Council (NRIC), will be
amended to charge NRIC with such advisory function.
2. Because NRIC will make recommendations to the Commission based
on input and submissions from T1E1.4 and other industry standards
bodies, that balanced representation within the NRIC should be able to
recommend against any issues that are unduly weighted towards any one
particular industry segment, we expect that NRICs involvement in these
issues will help in several ways to alleviate small business concerns
about incumbent LEC domination of T1E1.4, and will help safeguard
competitive neutrality in, and the timeliness of xDSL standards setting
for network interoperability generally.
110. Should the Commission find that certain industry standards
bodies are adopting spectrum compatibility standards or spectrum
management practices that continue to fail, in their underlying
processes, in safeguarding principles of competitive neutrality and
promoting innovation, we will look to other industry standards bodies
that uphold these principles or we will exercise our authority to
assume that standards-setting function ourselves.
111. The Commission finds the criterion for acceptability for
deployment outlined above--successful deployment of a technology
elsewhere without significantly degrading the performance of other
services--to be particularly useful for assisting the deployment of new
technologies without subjecting them to delays often encountered with
industry standards-setting fora. As a method to achieve a presumption
of acceptability for deployment that does not rely upon industry
standards bodies, the successful deployment criterion provides a
further antidote against concerns regarding the competitive neutrality
of the industry standards-setting process. This criterion should
benefit small LECs because it relieves the LEC from having to meet the
potentially burdensome requirements of the industry standards setting
process.
112. The LEC also will be able to rebut the presumption of
acceptability before a state commission if the technology proposed for
deployment poses a real interference threat in a certain area. We are
confident that this represents a sufficient safeguard for network
reliability. Indeed, because the power to rebut the presumption of
acceptability for deployment of a technology before a state commission
is an important safeguard for LECs, we decline to make the presumptions
that are based on technology's standardization or other approval by an
industry standards body or this Commission irrebuttable. This
rebuttable presumption benefits small LECs because it gives them a
vehicle to protect the network and their deployed services. Small LECs
particularly benefit by the fact that we allow carriers to rebut the
presumption of acceptability for deployment before the relevant state
commission.
113. The Commission confirms that an incumbent LEC need not act as
the initial point of contact in all service degradation disputes. This
relieves small incumbent LECs from the potential responsibility for
fielding all complaints; a task which could create an administrative
burden and a resource drain on small incumbents.
114. The Commission reaffirms and codify the policy that we
enunciated in the Advanced Services First Report and Order to guide
states in the resolution of interference disputes. Specifically, where
a LEC demonstrates that a deployed technology is significantly
degrading the performance of other advanced services or traditional
voice band services, ``the carrier deployning the technology shall
discontinue deployment of that technology and migrate its customers to
technologies that will not significantly degrade the performance of
other such services. We now add an exception to this rule that we
believe will further safeguard competitive neutrality and deployment of
new technologies. Specifically, where the only interfered-with service
itself is a known disturber, as designated by this Commission, that
service shall not prevail against the newly developed technology. This
exception prevents the undue protection of noisier technologies that
are at or near the end of their useful life cycle, at the same time
preventing the undue preclusion of new, more efficient and spectrally
compatible technologies. This rule benefits incumbents, including small
incumbents, by protecting the deployment of innovative services. The
deployment of known disturbers is not at risk of being displaced by new
[[Page 1344]]
technologies that do not meet the presumption of acceptability for
deployment.
115. Such an approach would designate automatic winners in the
event of interference disputes. Chief among these concerns is that the
guarded services approach is blatantly discriminatory, protecting
technologies favored by competitive LECs. We emphasize that any
criteria that favor incumbent LEC services in a manner that
automatically trumps, without further consideration, innovative
services offered by new entrants is neither consistent with section 706
of the 1996 Act nor with the Commission's goals as set out in the
Advanced Services First Report and Order. The policies that we
reiterate and adopt here as rules with respect to interference dispute
resolution protect new technologies often deployed by small carriers
against otherwise guarded technologies that tend to be deployed by
incumbents who are generally larger than competitive carriers that do
not favor the guarded services approach having carte blanche to be
deployed after-the-fact and cause interference. These policies also
provide guidance at the national level, in accordance with our finding
in the Advanced Services First Report and Order that ``uniform spectrum
management procedures are essential to the success of advanced services
deployment'' where they are possible, precisely to avoid requiring
competitive LECs to conform to different specifications in each state.
These policies, therefore, benefit small carriers by making it
administratively more efficient to deploy advanced services nationwide.
116. The Commission concludes that only permissible forms of binder
group management are the segregation of known disturbers and the use of
interference protection techniques. The Commission believes that the
interference that known disturbers in particular are likely to cause in
a multi-service environment renders it worthwhile for us to allow
incumbent LECs to decide whether to segregate such disturbers as a
further measure to protect against interference. This conclusion helps
small incumbent LECs to the extent that they are likely to have some
deployment of known disturbers (analog T1), because segregation is much
less burdensome on small incumbents than forced replacement. This rule
also helps small competitive carriers by prohibiting segregation of
services in a discriminatory manner.
117. Numerous competitive LECs, which are often small businesses,
continue to express concern that if we vest in incumbent LECs right to
manage binder groups unfettered, we will provide ample opportunity for
incumbent LECs to discriminate against introduction of new technologies
and/or to institute binder configurations which significantly favor
their own deployed technologies. The Commission is persuaded that we
must limit segregation practices to known disturbers, because only the
interference risks of mixing known disturbers with other technologies
outweigh the risks of anticompetitive segregation practices. Because we
currently do not determine ADSL to be a known disturber, we find that
SBC may not implement SFS, and we do order that SBC dismantle any
currently existing SFS implementation. We further stress that carriers
cannot use binder group management to preclude the deployment of new
technologies that are otherwise presumed to be acceptable for
deployment.
118. The Commission finds leaving disposition of known interfering
technologies to the states preferable to establishing a national sunset
period for known disturbers in this proceeding. The Commission is
concerned that a blanket sunset period may lead to unnecessary
replacement of analog T1 or other otherwise known disturbers, which
could lead further to unnecessary network disruption and could force
carriers to undertake exorbitant replacement expenditures. In addition,
as we acknowledged in the Advanced Services First Report and Order and
FNRPM, carriers that have a substantial base of analog T1 in
deployment, and in some areas it provides the only feasible high-speed
transmission capability. We also recognize that transitioning customers
to less interfering technologies may disrupt service for subscribers.
This rule benefits incumbents, including small incumbents, by not
imposing an automatic sunset period for known disturbers. Such a sunset
could be expensive and have unnecessary detrimental effects on small
carriers. At the same time, states are better equipped than incumbent
LECs to take an objective view of the disposition of known disturbers,
because of the vested interest that incumbent LECs have in their own
substantial base of known disturbers such as analog T1.
Ordering Clauses
Accordingly, pursuant to the authority contained in Sections 1
through 4, 7, 10, 201 through 205, 251 through 254, 256, 271, and
303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151
through 154, 157, 160, 201 through 205, 251 through 254, 256, 271, and
303(r), this Third Report and Order is adopted,
119. Part 51 of the Commission's Rules, 47 CFR 51, is amended.
120. SBC Communications Inc. and all of its affiliated companies
shall dismantle any currently existing Selective Feeder Separation
(SFS) implementations, unless such implementations solely designate,
segregate or reserve particular loops or binder groups for use solely
by analog T1 technology. Any carrier currently implementing any binder
group management technique, including SFS, which we prohibit above in
Section V.B.4. of this Order and that designates, segregates or
reserves particular loops or binder groups for use solely by any
particular advanced services loop technology other than analog T1,
shall discontinue and dismantle such implementations within 60 days
after the release of this Order.
121. The action contained herein has been analyzed with respect to
the Paperwork Reduction Act of 1995 and found to impose new or modified
reporting and recordkeeping requirements or burdens on the public.
List of Subjects in 47 CFR Part 51
Communications common carriers, telecommunications, telephone.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
Rule Changes
Part 51 of Title 47 of the Code of Federal Regulations is amended
as follows:
PART 51--INTERCONNECTION
1. The authority for part 51 continues to read as follows:
Authority: Sections 1-5, 7, 201-05, 207-09, 218, 225-27, 251-54,
271, 332, 48 Stat. 1070, as amended, 1077; 47 U.S.C. 151-55, 157,
201-05, 207-09, 218, 225-27, 251-54, 271, 332, unless otherwise
noted.
2. In Sec. 51.5, the following definitions are added in
alphabetical order to read as follows:
Sec. 51.5 Terms and definitions.
* * * * *
Binder or binder group. Copper pairs bundled together, generally in
groups of 25, 50 or 100.
* * * * *
Known disturber. An advanced services technology that is prone to
cause significant interference with other services deployed in the
network.
* * * * *
[[Page 1345]]
3. In Sec. 51.319, paragraph (h) is added to read as follows:
Sec. 51.319 Specific unbundling requirements.
* * * * *
(h) High frequency portion of the loop.
(1) The high frequency portion of the loop network element is
defined as the frequency range above the voiceband on a copper loop
facility that is being used to carry analog circuit-switched voiceband
transmissions.
(2) An incumbent LEC shall provide nondiscriminatory access in
accordance with Sec. 51.311 of these rules and section 251(c)(3) of the
Act to the high frequency portion of a loop to any requesting
telecommunications carrier for the provision of a telecommunications
service conforming with Sec. 51.230 of these rules.
(3) An incumbent LEC shall only provide a requesting carrier with
access to the high frequency portion of the loop if the incumbent LEC
is providing, and continues to provide, analog circuit-switched
voiceband services on the particular loop for which the requesting
carrier seeks access.
(4) Control of the loop and splitter functionality. In situations
where a requesting carrier is obtaining access to the high frequency
portion of the loop, the incumbent LEC may maintain control over the
loop and splitter equipment and functions, and shall provide to
requesting carriers loop and splitter functionality that is compatible
with any transmission technology that the requesting carrier seeks to
deploy using the high frequency portion of the loop, as defined in this
subsection, provided that such transmission technology is presumed to
be deployable pursuant to Sec. 51.230.
(5) Loop conditioning. (i) An incumbent LEC must condition loops to
enable requesting carriers to access the high frequency portion of the
loop spectrum, in accordance with Secs. 51.319(a)(3), and 51.319(h)(1).
If the incumbent LEC seeks compensation from the requesting carrier for
line conditioning, the requesting carrier has the option of refusing,
in whole, or in part, to have the line conditioned, and a requesting
carrier's refusal of some or all aspects of line conditioning will not
diminish its right of access to the high frequency portion of the loop.
(ii) Where conditioning the loop will significantly degrade, as
defined in Sec. 51.233, the voiceband services that the incumbent LEC
is currently providing over that loop, the incumbent LEC must either:
(A) Locate another loop that has been or can be conditioned,
migrate the incumbent LEC's voiceband service to that loop, and provide
the requesting carrier with access to the high frequency portion of the
alternative loop; or
(B) Make a showing to the relevant state commission that the
original loop cannot be conditioned without significantly degrading
voiceband services on that loop, as defined in Sec. 51.233, and that
there is no adjacent or alternative loop available that can be
conditioned or to which the customer's voiceband service can be moved
to enable line sharing.
(iii) If the relevant State commission concludes that a loop cannot
be conditioned without significantly degrading the voiceband service,
the incumbent LEC cannot then or subsequently condition that loop to
provide advanced services to its own customers without first making
available to any requesting carrier the high frequency portion of the
newly-conditioned loop.
(6) Digital loop carrier systems. Incumbent LECs must provide to
requesting carriers unbundled access to the high frequency portion of
the loop at the remote terminal as well as the central office, pursuant
to Sec. 51.319(a)(2) and Sec. 51.319(h)(1).
(7) Maintenance, repair, and testing. (i) Incumbent LECs must
provide, on a nondiscriminatory basis, physical loop test access points
to requesting carriers at the splitter, through a cross-connection to
the competitor's collocation space, or through a standardized
interface, such as an intermediate distribution frame or a test access
server, for the purposes of loop testing, maintenance, and repair
activities.
(ii) An incumbent seeking to utilize an alternative physical access
methodology may request approval to do so from the relevant state
commission, but must show that the proposed alternative method is
reasonable, nondiscriminatory, and will not disadvantage a requesting
carrier's ability to perform loop or service testing, maintenance or
repair.
4. Section 51.230 is added to read as follows:
Sec. 51.230 Presumption of acceptability for deployment of an advanced
services loop technology.
(a) An advanced services loop technology is presumed acceptable for
deployment under any one of the following circumstances, where the
technology:
(1) Complies with existing industry standards; or
(2) Is approved by an industry standards body, the Commission, or
any state commission; or
(3) Has been successfully deployed by any carrier without
significantly degrading the performance of other services.
(b) An incumbent LEC may not deny a carrier's request to deploy a
technology that is presumed acceptable for deployment unless the
incumbent LEC demonstrates to the relevant state commission that
deployment of the particular technology will significantly degrade the
performance of other advanced services or traditional voiceband
services.
(c) Where a carrier seeks to establish that deployment of a
technology falls within the presumption of acceptability under
paragraph (a)(3) of this section, the burden is on the requesting
carrier to demonstrate to the state commission that its proposed
deployment meets the threshold for a presumption of acceptability and
will not, in fact, significantly degrade the performance of other
advanced services or traditional voice band services. Upon a successful
demonstration by the requesting carrier before a particular state
commission, the deployed technology shall be presumed acceptable for
deployment in other areas.
5. Section 51.231 is added to read as follows:
Sec. 51.231 Provision of information on advanced services deployment.
(a) An incumbent LEC must provide to requesting carriers that seek
access to a loop or high frequency portion of the loop to provide
advanced services:
(1) Uses in determining which services can be deployed; and
information with respect to the spectrum management procedures and
policies that the incumbent LEC.
(2) Information with respect to the rejection of the requesting
carrier's provision of advanced services, together with the specific
reason for the rejection; and
(3) Information with respect to the number of loops using advanced
services technology within the binder and type of technology deployed
on those loops.
(b) A requesting carrier that seeks access to a loop or a high
frequency portion of a loop to provide advanced services must provide
to the incumbent LEC information on the type of technology that the
requesting carrier seeks to deploy.
(1) Where the requesting carrier asserts that the technology it
seeks to deploy fits within a generic power spectral density (PSD)
mask, it also
[[Page 1346]]
must provide Spectrum Class information for the technology.
(2) Where a requesting carrier relies on a calculation-based
approach to support deployment of a particular technology, it must
provide the incumbent LEC with information on the speed and power at
which the signal will be transmitted.
(c) The requesting carrier also must provide the information
required under paragraph (b) of this section when notifying the
incumbent LEC of any proposed change in advanced services technology
that the carrier uses on the loop.
6. Section 51.232 is added to read as follows:
Sec. 51.232 Binder group management.
(a) With the exception of loops on which a known disturber is
deployed, the incumbent LEC shall be prohibited from designating,
segregating or reserving particular loops or binder groups for use
solely by any particular advanced services loop technology.
(b) Any party seeking designation of a technology as a known
disturber should file a petition for declaratory ruling with the
Commission seeking such designation, pursuant to Sec. 1.2 of this
chapter.
7. Section 51.233 is added to read as follows:
Sec. 51.233 Significant degradation of services caused by deployment
of advanced services.
(a) Where a carrier claims that a deployed advanced service is
significantly degrading the performance of other advanced services or
traditional voiceband services, that carrier must notify the deploying
carrier and allow the deploying carrier a reasonable opportunity to
correct the problem. Where the carrier whose services are being
degraded does not know the precise cause of the degradation, it must
notify each carrier that may have caused or contributed to the
degradation.
(b) Where the degradation asserted under paragraph (a) of this
section remains unresolved by the deploying carrier(s) after a
reasonable opportunity to correct the problem, the carrier whose
services are being degraded must establish before the relevant state
commission that a particular technology deployment is causing the
significant degradation.
(c) Any claims of network harm presented to the deploying
carrier(s) or, if subsequently necessary, the relevant state
commission, must be supported with specific and verifiable information.
(d) Where a carrier demonstrates that a deployed technology is
significantly degrading the performance of other advanced services or
traditional voice band services, the carrier deploying the technology
shall discontinue deployment of that technology and migrate its
customers to technologies that will not significantly degrade the
performance of other such services.
(e) Where the only degraded service itself is a known disturber,
and the newly deployed technology satisfies at least one of the
criteria for a presumption that it is acceptable for deployment under
Sec. 51.230, the degraded service shall not prevail against the newly-
deployed technology.
[FR Doc. 00-458 Filed 1-7-00; 8:45 am]
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