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A.   a3TechnicalTechnical Document Style9Wg  2  1.   a4TechnicalTechnical Document Style8bv{ 2  a.   2Ma1TechnicalTechnical Document StyleF!<  ?  I.   a7TechnicalTechnical Document Style(@D i) . a8TechnicalTechnical Document Style(D a) . PleadingHeader for numbered pleading paperP@n   $] X X` hp x (#%'0*,.8135@8:>q*"xxxxWWxxxWWkkxxxH _ ?' ԍ GTE Opposition at 23 and Att. I.F GTE asserts that there will be no >0*((  ? crosselastic effects in its provision of 500 service.4?_ ?X ԍ Id. at 3.4 Finally, GTE considers the first year of service to be a "representative 12month period" within the meaning of Section 61.49(h) of the  ?X Commission's Rules.9@XX_ ?@ ԍ Id. at 34. 9 F. Pacific Bell Transmittal No. 1764 16. Sprint contends that Pacific Bell's nonrecurring charges are excessive when compared to nonrecurring charges proposed by US  ? West, BellSouth, Cincinnati Bell, and United.HA_ ? ԍ Sprint December 19 Petition at 67.H MCI asserts that Pacific Bell's 500 activation charge is excessive when compared to  ? Pacific Bell's 900 activation charge.B@x_ ? ԍ MCI December 19 Petition at 78. In a letter submitted on January 5, 1995, MCI contends that the 900 access service provisioning and description in Pacific Bell's tariff now is virtually the same as the 500 access service provisioning and description in Pacific Bell's Transmittal 1764. Letter from Christopher Bennett, Analyst, MCI Telecommunications Corporation, to Acting Secretary, Federal Communications Commission, January 5, 1995 (January 5 Letter).  MCI claims that Pacific  ?` Bell fails to base its rates on a representative 12month period.CC` _ ?p ԍ MCI December 19 Petition at 9.C MCI also criticizes Pacific Bell for assuming that it will experience 500 access demand in 497 central offices, rather than a  ? limited number of offices in urban areas.7D _ ?X ԍ Id. at 911.7 Finally, MCI criticizes Pacific Bell for estimating 90 percent crosselasticity and not reflecting this demand shift in its existing price cap  ? baskets.7E_ ?@ ԍ Id. at 12. 7 17. Pacific Bell argues that it is reasonable for its 500 access nonrecurring charges to be higher than those of other carriers. First, Pacific Bell argues that it plans to recover all its costs through a nonrecurring charge, while US West plans to  ? recover only a portion of its costs through nonrecurring charges.DF0_ ?% ԍ Pacific Bell Opposition at 12.D Second, Pacific Bell asserts that labor rates in its region are F0*(( higher than in other regions, and that the amount of labor required  ? varies greatly by switch type.4G_ ?  ԍ Id. at 2.4 18. In response to MCI, Pacific Bell denies that 500  ?  activation is comparable to 900 activation for rate purposes.6H X_ ? ԍ Id. at 23.6 Pacific Bell states that it does base its rates on a representative  ? 12month period.7I_ ?( ԍ Id. at 34. 7 Pacific Bell also states that to provide 500 access service only in urban areas would reduce its $163 rate by only $2.39 per switch per code, and would make the service  ? unavailable in most of Pacific Bell's service region.6Jx_ ? ԍ Id. at 46.6 Pacific Bell further argues that its rates are based on unit costs that do  ? not vary with demand.5K_ ?0 ԍ Id. at 6. 5 Finally, Pacific Bell states that it expects its shifts in demand to occur more than 12 months after the introduction of 500 service, and claims that it will reflect the  ? crosselastic effects in its 1996 annual access filing.8L _ ? ԍ Id. at 67. 8 G. Rochester Transmittal Nos. 3 and 4 19. MCI asserts that Rochester has failed to show the crosselastic effects of 500 access service, as required by Section  ? 61.49(h)(1)(ii).GM( _ ?X ԍ MCI December 29 Petition at 910. G MCI also criticizes Rochester for not basing  ?h its demand estimates on a representative 12month period.9Nh _ ? ԍ Id. at 1011. 9 It maintains that Rochester has not adequately explained nonstandard customer routing, or the charges that would be applicable to non ? standard customer routing.6OH _ ?! ԍ Id. at 14. 6 MCI claims that Rochester's nonrecurring charges for 500 access service are discriminatory because they are higher than its nonrecurring charges for 900  ? access service.8P_ ?% ԍ Id. at 1516.8  hP0*((Ԍ20. Rochester states that its rates are based on unit costs,  ? and therefore are not sensitive to demand.CQ_ ?  ԍ Rochester Opposition at 12. C Rochester claims that, unlike a recurring charge, demand estimates are not necessary  ?X to determine whether its nonrecurring charges are reasonable.RXXX_ ?@ ԍ Id. at 2 n.5. On January 26, 1995, Rochester filed Transmittal No. 4 which, among other things, provided demand projections as required by the Commission's Rules. Rochester denies that it will experience any significant cross ? elastic effects in providing 500 access service.CSx_ ? ԍ Rochester Opposition at 2 n.5.C Finally, in response to MCI's criticism of Rochester's nonstandard customer routing charges, Rochester explains that this charge will apply where a specific access customer requests a routing arrangement that differs from the standard arrangements that Rochester  ? offers.6T_ ?h ԍ Id. at 2. 6 H. SNET Transmittal No. 636 21. Sprint observes that SNET's planned charge of $0.015 per query is substantially higher than any 500 per query charge planned  ? by any other LEC.HU _ ? ԍ Sprint December 29 Petition at 34.H Sprint notes that SNET's 500 access service rate is almost three times as high as its 800 database service rate. Sprint argues that a rate based in part on switchbased  ? costs should be lower than a rate based exclusively on AIN costs.5V( _ ? ԍ Id. at 4. 5 Finally, Sprint notes that SNET plans to impose its charge regardless of whether the associated call is delivered. Sprint contends that this is unreasonable given that most other LECs plan to impose their charges on a per call delivered basis, and a per call delivered basis would make it easier for interexchange carriers to audit and verify the LECs' billings for access  ?P services.7WP _ ?! ԍ Id. at 45. 7 22. MCI asserts that SNET has failed to show the crosselastic effects of 500 access service, as required by Section  ?p 61.49(h)(1)(ii).GXpH _ ?H& ԍ MCI December 29 Petition at 910. G MCI also criticizes SNET for not basing itsp X0*((  ? demand estimates on a representative 12month period.9Y_ ?X ԍ Id. at 1011. 9 MCI believes that SNET's inclusion of billing costs in its 500 access rates is inconsistent with the Commission's detariffing of billing  ?X and collection services.9ZXX_ ?@ ԍ Id. at 1415. 9 MCI claims that SNET's recurring rates for 500 access service are discriminatory because they are higher  ? than its recurring rates for 800 access service.8[_ ?` ԍ Id. at 1516.8 23. SNET lists several reasons why it believes that its 500 access rates should not be expected to be equal to its 800 database rates. SNET states that it maintains its own AIN database, while the 800 database is maintained by a national database management  ? group.:\x_ ? ԍ SNET Opposition at 3.: SNET also argues that projected demand for 800 database  ?` service was much greater than 500 access service.4]` _ ? ԍ Id. at 3.4 SNET also contends that the Commission required 800 database service to be treated as a restructure under the price cap rules, while 500  ? access service is a new service.6^ _ ? ԍ Id. at 34.6 24. SNET further argues that a perquery rate structure for 500 access service is consistent with the rate structure for 800 database and Line Information Database (LIDB) services, and that  ? Sprint has not explained its anticipated audit problems.4_( _ ?X ԍ Id. at 4.4 SNET denies that it will experience any significant crosselastic  ?0 effects in providing 500 access service.4`0 _ ?x ԍ Id. at 5.4 SNET states that it incurred costs in revising its billing system for 500 access service, and asserts that MCI is mistaken in concluding that those  ? costs are detariffed billing and collection costs.4aH _ ?`" ԍ Id. at 5.4 Finally, SNET maintains that MCI could have derived SNET's cost projections from  ? data provided in its cost support.Ab_ ?% ԍ Id. at 56 and Exh. 1.A p hb0*((ԌI. Southwestern Bell Transmittal Nos. 2405 and 2408 25. MCI contends that Southwestern Bell's overhead cost loadings for 500 access service are unreasonable, because the ratio  ?  of rate to direct cost is 15 to 1.Ec _ ?x ԍ MCI December 19 Petition at 67.E MCI also asserts that Southwestern Bell has failed to show the crosselastic effects of  ? 500 access service, as required by Section 61.49(h)(1)(ii).8dX_ ? ԍ Id. at 1112.8 26. Sprint maintains that Southwestern Bell has not adequately explain the portion of its 500 costs attributable to  ? switchbased translation, and the portion attributable to AIN.He_ ?H ԍ Sprint December 19 Petition at 23.H According to Sprint, recovery of any switchbased costs through a recurring charge would be inconsistent with the 500 Access Waiver  ?( Order.vf( x_ ?0 ԍ Id. at 3, citing 500 Access Waiver Order at paras. 2627.v Sprint contends that Southwestern Bell's rate structure is likely to overrecover nonrecurring costs after 500 access service is incorporated into its price cap basket. Sprint recommends that Southwestern Bell recover its nonrecurring costs through a nonrecurring charge, and its recurring costs through a  ? recurring charge.Hg_ ? ԍ Sprint December 19 Petition at 56.H Sprint also maintains that Southwestern  ? Bell's demand estimates are unreasonably low.6h_ ? ԍ Id. at 34.6 27. According to Southwestern Bell, the direct cost ratio in its D&J is based exclusively on AIN direct costs, and if Southwestern Bell had considered direct costs associated with both AIN and switch based translation, the direct cost ratio would be  ? 1.015 to 1.i( _ ?@ ԍ Southwestern Bell Opposition at 12, citing Southwestern Bell Transmittal No. 2408 D&J at Figure 2. Southwestern Bell denies that there will be any crosselastic effects, because both access for 500 calls and access  ? "normal" 1+ and 0+ calls are switched access services.Ij _ ?(# ԍ Southwestern Bell Opposition at 23.I Southwestern Bell denies that it based any of its per query demand  ? estimate on its estimate for demand for NXX translations.5k_ ?H& ԍ Id. at 3. 5 Southwestern Bell also contends that the 500 Access Waiver Order permitted Southwestern Bell to recover its costs through a8k0*(( recurring charge, and accuses Sprint of attempting to reopen an  ? issue already decided.ml_ ?  ԍ Id. at 4, citing 500 Access Waiver Order at para. 30. m Finally, Southwestern Bell claims that  ? it complied with the new service cost support rules.HmX_ ?x ԍ Southwestern Bell Opposition at 4. H J. United Transmittal No. 24 28. MCI claims that United's rates for 500 access service are discriminatory because they are higher than its rates for 900  ?@ access service.En@_ ? ԍ MCI December 22 Petition at 56.E MCI also criticizes United for not basing its demand estimates on a representative 12month period, and for failing to show the crosselastic effects of 500 access service on  ? its existing price cap baskets.7ox_ ? ԍ Id. at 78. 7 29. United explains that its 900 access rates reflect jurisdictional separations factors in effect when its 900 service  ? tariff was filed in 1988.<p _ ?P ԍ United Opposition at 1.< United also contends that the difference between its 900 and 500 rates is much less than was  ?H suggested by MCI.4qH _ ?p ԍ Id. at 2.4 United asserts that it did provide a cost study, and maintains that it did not provide an estimate for the number of NXX activations because the only customer who has expressed interest in 500 access service did not provide this  ?h information until after United filed its tariff./rh( _ ?  ԍ Id. / Finally, United expects no crosselastic effects from 500 service. According to United, parties placing 500 calls will be able to reach the called party in situations in which the called party could not be reached using other calling methods. Thus, there will be a net increase in both terminating minutes and 500 access  ? minutes and no shift from other services to 500 service.6s _ ?`" ԍ Id. at 23.6 K. US West Transmittal No. 570 30. Sprint criticizes US West for comparing its 500 access service overhead loading factor to overhead loadings for the Traffic Sensitive basket, rather than the database access subH s0*((ԫ ? basket.Ht_ ?X ԍ Sprint December 19 Petition at 8. H Sprint also contends that US West's per query 500 rate  ? is unreasonably high relative to its 800 query rate.6uX_ ? ԍ Id. at 89.6 Similarly, MCI claims that US West's rates for 500 access service are discriminatory because they are higher than its rates for 900  ?  access service.Ev _ ? ԍ MCI December 22 Petition at 56.E MCI contends that the rates and cost support in US West's Transmittal No. 525, which was US West's initial attempt to establish rates for 500 access service, are inconsistent with  ?x the rates and cost support in its tariff filing before us now.w xx_ ? ԍ Id. at 6. MCI notes that US West Transmittal No. 525 was rejected for reasons other than inadequate cost support. Id., citing US West Communications, Inc., Revisions to Tariff F.C.C. No. 5, 9 FCC Rcd 5228 (Com.Car.Bur. 1994).  MCI also criticizes US West for not basing its demand estimates on a representative 12month period, and for failing to show the crosselastic effects of 500 access service on its existing price  ? cap baskets.Fx` _ ? ԍ MCI December 22 Petition at 89. F 31. US West explains that it incurs more costs in providing 500 access than it does in providing 800 database service. This is because US West maintains its own switchbased translation tables and AIN database, while the 800 database is maintained by a  ?H national database management group.?yH _ ? ԍ US West Opposition at 35.? US West also claims that comparisons between 500 access service and 900 access service are  ? not relevant, because 900 service does not require a database.6z _ ? ԍ Id. at 67.6 US West argues that the traffic sensitive category is appropriate basis on which to judge its 500 access overhead loadings, because 500 access investment and expense will be placed in that basket. US West denies that the database access service category is  ? appropriate for 500 access service.7{_ ?`" ԍ Id. at 78. 7 US West attaches as Exhibit A demand projections for the first 12 months of service, and does not expect dramatic growth in 500 access demand, or crosselastic  ? effects, as does MCI.6|_ ?H& ԍ Id. at 89.6 Finally, US West explains that the rates in its Transmittal No. 570 are lower than they were in its0|0*(( Transmittal No. 525 because they are based on updated and more  ? accurate cost support information.4}_ ?  ԍ Id. at 9.4  ?X |  IV. CONCLUSION AND ORDERING CLAUSES ă 32. We have reviewed the tariffs filed by the carriers captioned above, as well as all associated tariff revisions and pleadings. We conclude that none of those tariffs are patently unlawful so as to warrant rejection, and that an investigation is not warranted at this time.  33. Accordingly, IT IS ORDERED that the petitions for  ?` rejection or suspension and investigation filed by MCI Telecommunications Corporation and Sprint Communications Company, L.P., listed in Appendix A to this Order, ARE DENIED. !34. IT IS FURTHER ORDERED that the petition for rejection or suspension and investigation filed by MCI Telecommunications Corporation, against NYNEX Telephone Companies, Tariff F.C.C. No. 1, Transmittal No. 329, IS DISMISSED AS MOOT. "35. IT IS FURTHER ORDERED that the motion for leave to file out of time, filed by Rochester Telephone Corporation, IS GRANTED. ` `  hh#(FEDERAL COMMUNICATIONS COMMISSION ` `  hh#(Geraldine #A. Matise ` `  hh#(Acting Chief, Tariff Division ` `  hh#(Common Carrier Bureau ` `  hh#(-XX}0*((  ? % APPENDIX A ă @ Parties filing Petitions to Reject or  Suspend and Investigate 500 Access Tariffsă Petition hh#(-Tariffs 1.XMCI December 19` hh#Ameritech 846; Pacific Bell 1764; and (#h Petition:  hh#Southwestern Bell 2405 and 2408. 2. Sprint December 19 hh#Ameritech 846; Pacific Bell 1764; Petition:  hh#Southwestern Bell 2405 and 2408; BellSouth 248; and US West 570.(#h 3. MCI December 20 hh#BellSouth 248. Petition: hh#(# 4. MCI December 21 hh#Cincinnati Bell 673. Petition: hh#(# 5.MCI December 22 hh#United 24 and US West 570. Petition: hh#(# 6. MCI December 29 hh#Bell Atlantic 725; Rochester 3; and SNET Petition: hh#636.(# 7. Sprint December 29hh#Bell Atlantic 725 and SNET 636. Petition: hh#(# 8. MCI January 3 hh#GTE Telephone Operating Companies 937 and Petition: Xhh#GTE System Telephone Companies 131. (#