LOCAL TELECOMMUNICATIONS COMPETITION A CHRONOLOGY: "BABY BELLS" SECTION 271 LONG DISTANCE APPLICATIONS
LOCAL TELECOMMUNICATIONS COMPETITION
A CHRONOLOGY: "BABY BELLS" SECTION 271
LONG DISTANCE APPLICATIONS
Today’s Order does not take place in a vacuum. The decision to approve Bell Atlantic’s section 271 application is the culmination of Congress’, the Courts’, the states’ and the FCC’s efforts to open the local telecommunications markets to competition. The 1996 Act's overriding goal is to open all telecommunications markets to competition and, ultimately, to deregulate these markets to spur competition and provide consumer choice.
Before the 1996 Act's passage, the Regional Bell Operating Companies (BOCs), the local progeny of the once-integrated Bell system, were barred by the terms of the Justice Department’s Modified Final Judgement (MFJ) from entering certain lines of business, including long distance services. The ban on long distance services was based on the MFJ court's determination that such a restriction was "clearly necessary to preserve free competition in the interexchange market," or long distance market. The court concluded that the BOCs would have "substantial incentives" and opportunity, through their control of the local telecommunications network – the local exchange and exchange access facilities and services – to discriminate against their long distance rivals and to cross-subsidize their long distance ventures.
Through the competitive checklist and the other requirements of section 271,
Congress defined the mechanism by which the BOCs may enter the in-region, long
distance market. This mechanism replaces the structural approach of the MFJ that prohibited BOCs from participating in that market.
Accordingly, Congress set up a framework that requires BOCs to demonstrate that their local markets are open to competition before they are permitted to enter the in-region long distance market. In order to execute Congress' intent, the FCC must make certain that the BOCs have opened their local markets and thus allow competition to develop in those markets.
Bell Atlantic’s successful section 271 application, and the preceding five section 271 applications by other BOCs, will provide a "roadmap" for all future applications so that consumers can enjoy the fruits of competition as soon as possible. Following is a timeline of key events that have brought us to today’s decision:
February 1996 – Congress passed the Telecommunications Act of 1996 that provided a national framework to open the nation’s telecommunications markets to competition.
February 13, 1997 – Bell Atlantic filed a draft application under section 271, along with a Statement of Generally Applicable Terms and Conditions with the New York Commission.
April 11, 1997 – SBC filed its section 271 application for Oklahoma with the FCC.
May 21, 1997 – Ameritech filed its section 271 application for Michigan with the FCC.
June 26, 1997 – The FCC denied SBC’s section 271 application for Oklahoma, concluding that SBC had not demonstrated that it is providing access and interconnection to an unaffiliated, facilities-based competing provider, as required by section 271(c)(1)(A) of the statute.
July 8, 1997 – After a number of technical conferences and collaborative meetings and technical and legal analyses, a New York Commission Administrative Law Judge concluded that Bell Atlantic had made a prima facie case regarding certain offerings, but had not met its burden of proof regarding commercial availability, procedure standardization, timeliness, and measuring parity. Subsequently, the New York Commission held additional collaborative sessions to work out technical details associated with the development of a working Operations Support System. Following the approval of the Bell Atlantic/NYNEX merger, Bell Atlantic filed a supplemental section 271 application with the New York Commission.
August 19, 1997 – The FCC denied Ameritech’s section 271 application for Michigan, concluding that although Ameritech met its burden of demonstrating that it is providing access and interconnection to an unaffiliated, facilities-based competitor, Ameritech had not yet demonstrated that it has fully implemented the competitive checklist in section 271(c)(2)(B). In particular, the Commission found that Ameritech had not met its burden of showing that it meets the competitive checklist with respect to: (1) access to the systems used to provide service to competitors (operations support systems or OSS); (2) interconnection; and (3) access to its 911 and E911 services. The Commission did not decide whether Ameritech had met its burden of demonstrating compliance with the remaining items on the competitive checklist.
September 30, 1997 – BellSouth filed its section 271 application for South Carolina with the FCC.
November 6, 1997 – BellSouth filed its first section 271 application for Louisiana with the FCC.
December 24, 1997 – The FCC denied BellSouth’s section 271 application for South Carolina. The Commission concluded that 1) that BellSouth failed to show that it provided nondiscriminatory access to its operations support systems (OSS) to competitors, 2) BellSouth failed to show that it is providing access to portions of its network, or "unbundled network elements," in a manner that allows competing carriers to combine these elements to provide service, and 3) BellSouth's failure to offer certain individually tailored customer contracts, or Contract Service Arrangements (CSAs), at a wholesale discount to competing carriers violated of the Communications Act and the Commission's implementing regulations.
February 4, 1998 – The FCC denied BellSouth’s first section 271 application for Louisiana, concluding that BellSouth had not demonstrated that it provides competing carriers nondiscriminatory access to its operations support systems (OSS) functions. In addition, the FCC concluded that BellSouth's refusal to offer contract service arrangements for resale at a wholesale discount violates the requirement in section 271(c)(2)(B)(xiv) that a Bell Operating Company (BOC) must make telecommunications services available for resale in accordance with the competitive checklist.
April 6, 1998 – Bell Atlantic filed a Pre-Filing Statement with the New York Commission. The Pre-Filing Statement included a number of commitments including: 1) to provide combinations of elements (including the platform of loops, switches and transport (UNE-P) as a minimum service offering); 2) to engage a third-party to test Bell Atlantic’s Operations Support Systems (OSS); and 3) to establish a self-effectuating system to prevent backsliding. Additionally, Bell Atlantic obtained a comprehensive third-party test of its wholesale support systems. This was conducted by KPMG Peat Marwick (KPMG) and Hewlett Packard under the supervision of the New York Commission. Together, the New York Commission and KPMG created an open testing environment--consulting with interested parties, issuing draft plans and reports, and reporting in detail on issues of serious concern.
July 9, 1998 – BellSouth filed its second section 271 application for Louisiana with the FCC.
October 13, 1998 – The FCC denied BellSouth’s second section 271 application for Louisiana, concluding that it did not satisfy the statutory requirements.
January 1999 – The Supreme Court upheld most of the Commission’s fundamental determinations in the Local Competition Order, while remanding the Commission’s unbundling rules for further consideration.
August 6, 1999 – KPMG Peat Marwick released its final third-party report on its test of Bell Atlantic’s wholesale support systems and plan to ensure adequate continuing wholesale performance.
September 15, 1999 – The FCC adopted a revised list of unbundling rules in response to the Supreme Court.
September 29, 1999 - Bell Atlantic filed its section 271 application to offer long distance service in New York with the FCC.
October 18, 1999 – The New York Commission submitted its evaluation of Bell Atlantic’s application, stating that Bell Atlantic-NY has met the checklist requirements of section 271.
November 1, 1999 – The Department of Justice filed its evaluation. The Department of Justice found that "Bell Atlantic has completed most – but not all - of the actions needed to achieve a fully and irreversibly open market in New York." The Department expressly reserved judgment, however, on whether the facts in the record established compliance with the legal requirements of the competitive checklist or the Commission’s rules.
December 21, 1999 – The FCC grants Bell Atlantic’s application to enter the long distance market in New York State based on its conclusion that Bell Atlantic has taken the statutorily required steps to open its local exchange and exchange access markets to competition.