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DXP# " S^2CRddCCCdq2C28dddddddddd88qqqYzoCNzoozzC8C^dCYdYdYCdd88d8ddddCN8ddddY`(`lC2CC!CCC CCCCCC Cd8 YYYYYYzYzYzYzYC8C8C8C8ddddddddddYdddddod YYYYYYdzYzYzYzYd ddddddCdCdCCCd NCdz8zCzCzCz8d ddddCCCoNoNoNoNzCzCzC ddd ddzYzYNF 2 [dCYdddd d7>d< d< $ YYdCC dd oo CY ( ((x((( (((((( (C! Wd< d< $ YYdCC dd oo CY d< d< + oodCC dd dd Co assistance services in the state of New York. = Hz ;
y O s - ԍx Answer at 1.= NYT's electronic white pages (EWP) service
x 0 offers subscribers direct online access to the telephone company's listings without the
X -
x involvement of a directory assistance operator. r
;
y O - ԍx NYNEX Tariff, F.C.C. No. 1, Section 20.1 ("General Description").r In addition to its interstate EWP service under
x = NYNEX Tariff F.C.C. No. 1, NYT provides intrastate EWP service pursuant to a tariff filed with
X
-
x the New York Public Service Commission (NYPSC). ^
;
{ O 7 - ԍx See N.Y. Tel. Co. NYPSC Tariff No. 900.^ The federal and state tariffs are essentially
x y identical in services and prices, differing only to the actual listings that can be accessed by the
X - subscribers. B ,
;
y O -
ԍx Prior to the implementation of the Discount Plan, the state tariff reflected a retail directory assistance rate
{ O c -
x of $.45. Both the federal and state tariffs reflected wholesale EWP rates of about $.23. See N.Y. Tel. Co. NYPSC
x Tariff 900; NYNEX Tariff F.C.C. No. 1. The federal tariff does not contain a retail rate. Moreover, the federal
x Y tariff contemplates two distinct tariffs for EWP service. For example, the federal tariff provides that within NYT's
x operating territory "customers will have access to all listings from LATAs within the database except for the user's
x : home LATA. In the New York Telephone operating territory, the Telephone Company will offer NYNEX Electronic
x White Pages Service for the home LATA as provided under the general and/or local exchange tariff." NYNEX
Tariff F.C.C. No. 1, Section 20.2.3.
x 4. INFONXX's primary access to NYT's listings is through NYT's EWP service,
x although access can also be obtained through NYT's retail directory assistance service pursuant
X b -
x to NYT's state tariff. \
b6 ;
y O I# - ԍx INFONXX Brief at 3; Complaint at Exhibit F.\ According to INFONXX, NYT's database is particularly important to it
X K -
x because it encompasses metropolitan New York City, a major directory assistance market. D K ;
y O % - ԍx INFONXX Brief at 3.D Prior " K V ,T'T'33 "
x [ to November 11, 1995, NYT assessed INFONXX the wholesale rate of about $.23 per EWP call,
X -
x the rate reflected in both federal and state tariffs. @ ;
y O b - ԍx Complaint at 6.@ As discussed further below, it is unclear from
x the record whether INFONXX believed during this period that it was taking NYT's EWP service
pursuant to NYT's federal or state tariff.
X -
# x 5. On August 29, 1995, NYT filed a Directory Assistance Volume Discount Plan
x > (Discount Plan) with the NYPSC, pursuant to which NYT proposed to reduce the $.45 retail
x charge for a directory assistance call under the state tariff to as low as $.37, depending on usage
X H -
x | volumes and length of the contract term.
"HX ;
y O Q -
ԍx NYNEX Brief at 2. The Discount Plan was submitted as a proposed tariff revision to N.Y. Tel. Co. NYPSC
x Tariff No. 900. The Discount Plan states that it applies to business customers of intraLATA, intrastate directory
{ O -
x - assistance, and that it does not apply to calls made through NYNEX Electronic White Pages. See Complaint at
Exhibit C A.1, A.2.f. INFONXX filed a petition with the NYPSC
x challenging NYT's proposed Discount Plan. INFONXX asserted that it meets the needs of its
X -
x customers for directory assistance service by using NYT's EWP service, and argued, inter alia,
x that, by reducing the retail price for directory assistance from $.45 to $.37, while maintaining the
x z $.23 charge for the wholesale EWP bottleneck service, NYT's Discount Plan created an anti
X -
x competitive "price squeeze" ? " B ;
y O -
ԍx "A price squeeze can occur when an entity that provides both a retail product and a necessary input for
x providing that retail product possesses market power over the input. A price squeeze exists when the price of the
x Y input product is so high, relative to the price of the retail product, that competing providers of the retail service are
{ O " - unable to make a profit." Ameritech Operating Companies, Order, 11 FCC Rcd 14028, 14040 n.44 (1996).? designed to force INFONXX out of business. N ,
;
y O - ԍx Complaint at Exhibit E.N Subsequent to the
x filing of the petition, the NYPSC staff along with INFONXX and NYT representatives discussed
x possible settlement of the issues raised by the petition. The settlement discussions were based
X -
x L on the assumption that INFONXX received EWP service under the intrastate tariff. W ;
y O - ԍx Answer at 4; INFONXX Reply at 2.W Effective
x \ November 11, 1995, pursuant to a settlement proposed by the NYPSC, and agreed to by the
x parties, NYT lowered the wholesale EWP rate in N.Y. Tel. Co. NYPSC Tariff No. 900 from $.23
X M -
x L to $.07. q |ML
;
{ O J -
> ԍx See Complaint at Exhibit F. On November 9, 1995, the NYPSC issued an Order approving the Discount
x Plan. In approving the Discount Plan, the NYPSC noted that because accurate and timely listings information cannot
{ O ! -
x be obtained elsewhere, access to NYT's database is essential, and thus a bottleneck service element. Id. at 4. The
x NYPSC further stated that to alleviate a potential price squeeze, NYT, could revise its discount rates upward or
x reduce its EWP rates. Based on discussion between NYPSC staff, NYT, and INFONXX, the NYPSC decided to
x approve the Discount Plan due to NYT's agreement to reduce the EWP rate. The NYPSC does not mention or refer
to the interstate tariff in its Order.q NYT made no corresponding changes in its interstate tariff EWP offerings, and there
x y is nothing in the record indicating that either INFONXX or NYT, in negotiating their agreement " 6 ,T'T'33* " before the NYPSC, contemplated similar or parallel changes in NYNEX Tariff F.C.C. No. 1.
X -
" x 6. In January 1996, INFONXX received a bill from NYT for November and December
x EWP usage. The bill invoiced INFONXX for use of EWP service at the preNovember 11, 1995,
X -
x l rate of $.23 per EWP call. @ ;
y O - ԍx Complaint at 9.@ INFONXX contacted NYT and, according to INFONXX, was
x y informed by NYT for the first time that its EWP service was provided under the interstate tariff,
X v -
x > not the intrastate tariff, and that NYT had not lowered the interstate EWP rate. A vX ;
{ O - ԍx Id. at 10.A Following
x unsuccessful attempts to resolve their dispute, INFONXX filed the instant complaint with the
X H -
x Commission on April 12, 1996. : H ;
{ O - ԍx Id.: The complaint alleged that NYT has charged an unjust and
x = unreasonable rate to INFONXX for use of its EWP service in violation of Section 201(b) of the
X - Act. : | ;
{ O G - ԍx Id.:
X
-
x 7. NYT disputes INFONXX's claims that the $.23 interstate EWP rate is unlawful under
x Section 201(b) of the Act and that NYT has otherwise acted unreasonably in connection with its
X -
x EWP offerings. ? ;
y O } - ԍx Answer at 45.? NYT maintains that it was INFONXX who first informed NYT, after the
x Discount Plan went into effect, that INFONXX took service under the interstate tariff and that
x it was the interstate tariff that INFONXX wished to have lowered. NYT stated in the answer that
x it was prepared to lower its interstate EWP rate to provide consistency with the action it had
X b -
x taken to reduce the intrastate EWP. @ b ;
{ O - ԍx Id. at 6.@ NYT asked the Commission to dismiss INFONXX's
X K -
x complaint on the condition that NYT lower the interstate EWP rate. @ K0
;
{ O , - ԍx Id. at 7.@ INFONXX filed a reply
x opposing NYT's motion to dismiss. INFONXX argued that, notwithstanding NYT's proposed
x prospective adjustment of the interstate EWP rate, it is entitled to monetary damages for harm
x incurred as a consequence of the unlawful EWP rates assessed by NYT beginning November 11,
X -
x 1995. > ;
y O b" - ԍx Reply at 69.> INFONXX petitioned the NYPSC to cancel the Discount Plan. R
;
y O # - ԍx Complaint at 11. There is no indication in the record that the NYPSC canceled the Discount Plan. On June 27, 1996,
x NYT notified INFONXX that, as committed in its answer, a tariff revision was filed with the
x Commission which reduced the interstate tariff from $.23 to $.07, effective July 1, 1996, " ,T'T'33 "
X -
x matching the EWP rate reflected in NYT's intrastate tariff. ;
y O y -
k ԍx Letter from Donald C. Rowe, Counsel for NYNEX, to John W. Dax, Attorney for INFONXX, dated June
27, 1996. The parties have failed to settle
this dispute.
X - III. DISCUSSION ă
X - x ` ` 1. Contentions
x ` `
X _ - x ` ` a. Reasonableness of NYT's $.23 Interstate EWP Rate
X 1 -
x 8. INFONXX's first allegation is that the interstate tariff rate was excessive and therefore
X -
x x unjust and unreasonable under Section 201(b) of the Act. E ;
y O
- ԍx INFONXX Brief at 12.E INFONXX contends that by agreeing
x \ to lower the interstate EWP rate from $.23 to $.07 with no corresponding reduction in costs,
x NYT has effectively conceded that the $.23 rate was excessive within the meaning of Section
X -
x 201(b) of the Act. c ;
{ O 6 - ԍx Id. at 13. See 47 U.S.C. 201(b).c According to INFONXX, a rate that is more than three times the rate that
x a common carrier has admitted is compensatory must be unjust and unreasonable. INFONXX
x . contends that while the determination of reasonableness of rates ordinarily requires a costof
x service study, no cost study or further cost analysis is necessary in this case because NYT has
X y - admitted that the $.23 per call rate far exceeds its costs of providing wholesale EWP service. K yB ;
y O l - ԍx INFONXX Brief at 13.K
x 9. NYT disputes INFONXX's claim that the $.23 rate for interstate EWP service,
X 4 -
x assessed between November 11, 1995 and July 6, 1996, was excessive under Section 201(b). G 4 ;
y O - ԍx NYT Reply Brief at 19.G
x y NYT states that it submitted detailed cost support information to both the Commission and the
x NYPSC when it filed the $.23 interstate and intrastate rates in 1990 demonstrating that the rate
X -
x K was not unreasonable. : b ;
{ O - ԍx Id.: NYT maintains that it has never agreed that the $.07 interstate EWP rate
X -
x is compensatory, as INFONXX alleges. D !
;
{ O }" - ԍx Id. at 1819.D NYT argues the $.23 rate did not cover the cost of
X -
x providing interstate EWP service and the $.07, likewise, falls short of NYT's actual costs. : " ;
{ O $ - ԍx Id.: NYT
x states that, at the time, reducing the rates in the interstate tariff would have raised problems that " " ,T'T'33 "
x reducing the rates in the intrastate tariff did not. For example, NYT states that AT&T took
x L service pursuant to the interstate tariff, and lowering the rate would have resulted in increased
X -
x usage thereby straining facility capacity which would effect quality of service and revenue. F # ;
y O K - ԍx NYT Brief at 4.F
x NYT states that it eventually lowered the tariff because it planned to offer a new service, thereby
X -
x z eliminating those quality of service and revenue concerns. @ $ X ;
{ O - ԍx Id. at 5.@ NYT states that it reduced the
x interstate EWP rate from $.23 to $.07 after INFONXX commenced proceedings before the
X v -
x NYPSC seeking an order cancelling the intrastate Discount Plan. % v ;
{ O -
ԍx Id at 4. It appears from the record that NYT's offer to reduce the interstate EWP rate was initially made
{ O - in NYT's answer. See NYT Answer at 6. It argues that, faced with the
x renewed possibility of having to suspend the Discount Plan because of proceedings before the
X H - NYPSC, NYT decided to reduce the interstate EWP rate to match the intrastate rate. F & HF ;
y O ? - ԍx NYT Brief at 4.F
X -
{ x 10. NYT contends, the reasonableness of its intrastate EWP rate has no bearing on the
X
-
x reasonableness of the interstate rate the issue properly before this Commission. @ '
;
{ O - ԍx Id. at 9.@ NYT
x contends that the separate jurisdictions, and their differing approaches to ratemaking and
x = reasonableness, there can be no automatic impact on the rates in one jurisdiction because of a
X -
x change of the rates in another jurisdiction. : ( h ;
{ O - ԍx Id.: NYT points out that INFONXX requested, and the
x settlement negotiated with the NYPSC required, that NYT reduce the rates only in the intrastate
X - tariff. @ )
;
{ O ; - ԍx Id. at 4.@
X b - x ` ` b. Alleged Unlawful Price Squeeze
? x
11. INFONXX next argues that the $.23 rate charged by NYT for interstate EWP service
X -
x created an unlawful price squeeze. J * ;
y O Z! - ԍx INFONXX Brief at 8.J INFONXX argues that in reviewing NYT's interstate EWP
x [ rate, this Commission is bound by the findings of the NYPSC that the $.23 intrastate EWP rate,
X -
x N when coupled with NYT's intrastate Discount Plan, created an unlawful price squeeze. ] + ;
{ O $ - ԍx Id. at 912; INFONXX Reply Brief at 7.]
x INFONXX contends that because the NYPSC determined that NYT's directory assistance " + ,T'T'33& "
x database is a bottleneck for New York State competitors, it must be a bottleneck for interstate
X -
x competitors as well. P , ;
y O b - ԍx INFONXX Reply Brief at 8.P INFONXX notes that NYT put the Discount Plan into effect in compliance
x with NYPSC's order without contesting NYPSC's price squeeze determination or its EWP pricing
X -
x j condition. E - X ;
y O - ԍx INFONXX Brief at 10.E INFONXX asserts that because NYT did not seek a rehearing or judicial review of
X -
x [ the NYPSC's decision, it is bound by the NYPSC's determinations. : . ;
{ O = - ԍx Id.: INFONXX states that the
x fact that it lost market share during the period the $.23 interstate EWP rate was in effect is
X v -
x = evidence of the unlawful price squeeze. A / vz ;
{ O - ԍx Id. at 14.A According to INFONXX, NYT acknowledged that it
x secured two large customers after the Discount Plan went into effect, one of which was a
X H -
x previous INFONXX customer. : 0 H ;
{ O - ԍx Id.: Moreover, INFONXX contends that it did not attract any new
x customers during the alleged price squeeze, and lost one existing customer and a bid for a
X -
x prospective customer. A 1 ;
{ O i - ԍx Id. at 15.A INFONXX does not support its allegations with any facts or arguments
x . about how NYT's interstate EWP rate worked in conjunction with the intrastate Discount Plan
to create the alleged price squeeze or to cause the alleged loss of actual and potential customers.
X -
0 x 12. NYT characterizes INFONXX's price squeeze allegations as baseless. @ 2 0
;
y O - ԍx NYT Brief at 9.@ It contends
x k that there is no basis for finding a price squeeze because NYT provides no bottleneck EWP
X -
x service. A 3 ;
{ O - ԍx Id. at 12.A According to NYT, INFONXX obtains the bulk of its directory assistance information
x k from sources other than NYT's EWP and that INFONXX's actual use of NYT's EWP service
X b -
x is much less than that determined by the NYPSC. F 4 bR
;
{ O e - ԍx Id. at 1011. F NYT asserts that it did not challenge the
X K -
x [ NYPSC's determination because of the settlement proposed by the NYPSC. : 5 K ;
{ O ! - ԍx Id.: NYT argues that
x the NYPSC's statements about a price squeeze are not binding because the matter was settled
x before the NYPSC without formal proceedings and the costs of providing the alleged bottleneck
X -
x service to others was never determined by the NYPSC. @ 6 v ;
{ O -& - ԍx Id. at 9.@ Moreover, NYT argues, the NYPSC " 6 ,T'T'33 "
x never made findings with regard to NYT's interstate EWP rates, nor was it within its jurisdiction
X - to do so. : 7 ;
{ O b - ԍx Id.:
X -
1 x 13. NYT states that it filed the intrastate Discount Plan with the NYPSC because the
x - normal $.45 charge for an operatorassisted directory assistance call was priced well above costs,
x and large business customers were either restricting employee use significantly or turning to
X v -
x > alternative competitive sources for telephone number information. 8 vZ ;
{ O -
ԍx Id. at 2, 6 (NYT lists such competitive alternatives as computerized data sources, local directories and
alternative providers of operator assistance). To stem the decline in
x customers, NYT states that it decided to offer reduced retail rates, averaging $.37 a call, which
x covered the costs of the service. According to NYT, the labor costs of the operators was about
x [ $.30 a call, and the remaining $.07 represented the costs to NYT for access to its own data plus
X -
x any contributions above costs. @ 9 ;
{ O - ԍx Id. at 7.@ NYT argues that, faced with a delay in its Discount Plan, it
x agreed to lower the wholesale EWP rate from $.23 to $.07 as proposed by NYPSC without
x attempting to prove that its cost of providing the alleged bottleneck service to others was higher
X -
x than the cost of providing it to itself. @ : F ;
{ O - ԍx Id. at 8.@ NYT states that, in the face of INFONXX's opposition
x to the Discount Plan, the NYPSC staff had made it clear that the plan would be suspended
X
- pending an investigation. @ ;
;
{ O 0 - ԍx Id. at 3.@
X y - x ` ` 2. Decision
x
14. It is well established that in complaint proceedings pursuant to Section 208 of the
x Act, the complainant bears the burden of proving a violation of the Act, or a Commission rule
X -
x or order. : < Z j ;
{ O 8 -
ԍx E.g., ACC Long Distance Corp. v. Yankee Microwave, Inc., Memorandum Opinion and Order, 10 FCC Rcd
x ; 654, 659 (1995) (complainant has burden to substantiate its allegations that rates are unlawful under Section 201(b)
of the Act).: In the instant case, INFONXX's claims of unreasonableness under Section 201(b) are
x = based largely on parallels it draws between NYT's interstate and intrastate EWP offerings. As
x discussed more fully in the paragraphs that follow, we conclude that INFONXX has failed to
x establish that NYT's actions with respect to its interstate EWP rate were unreasonable or created
an illegal price squeeze in violation of Section 201(b) of the Act.
x " < ,T'T'33o "
X - x ` ` a. Reasonableness of NYT's $.23 Interstate EWP Rate .
X -
{ x 15. INFONXX correctly notes that costs are traditionally and naturally a benchmark for
X -
x evaluating the reasonableness of rates under Section 201(b) of the Act. = ;
{ O 4 -
ԍx See INFONXX Brief at 13; Investigation of Special Access Tariffs of Local Exchange Carriers, 5 FCC Rcd
400, 403 (1990). It concedes that it has
x L proffered no cost data to support its allegations that the interstate EWP rates are excessive. It
x contends, however, that such information is unnecessary in this case because "NYT has already
X v -
x agreed that $.07 is a rate that recovers its costs of providing the EWP service." E > v" ;
y O I
- ԍx INFONXX Brief at 13.E We do not
x agree. The record before us does not reflect an admission by NYT that $.07 is the rate that
x covers its cost of providing interstate EWP service as INFONXX contends. To the contrary,
x NYT has represented that the $.23 rate failed to cover its costs of providing EWP service and
X -
x j the $.07 represents the cost NYT to access its own data base listings. J ? ;
{ O } - ԍx See NYT Brief at 7.J INFONXX declined to
x provide specific information or evidence to counter these assertions, instead resting its Section
x 201(b) claim on the substantial disparity between the former $.23 interstate EWP rate and the
x current $.07 rate. The inferences and conclusions that INFONXX would have us draw from this
x . fact alone, however, are too great. Although a substantial reduction in rates with no apparent
x ] corresponding reductions in underlying costs may be sufficient to call into question the
x reasonableness of the former rate, this fact, without more, does not establish the unlawfulness of
x the former rate under Section 201(b). In the absence of additional arguments and evidence from
INFONXX, we are left with the rational proffered by NYT in support of the $.23 rate.
x
x 16. Under the limited facts of this case, we are not prepared to say that the $.23 interstate
x EWP rate assessed by NYT between November 11, 1995 and July 6, 1996, was unjust and
x unreasonable within the meaning of Section 201(b) of the Act. The Commission has previously
x ! recognized the legitimate business needs of a carrier as relevant factors for purposes of
X -
x determining reasonableness under Section 201(b) @ D ;
{ O - ԍx See RCA Communications, Inc., Memorandum Opinion and Order, 86 FCC 2d 165, 173 (1981). INFONXX, the party with the burden of
x { proof in this case, has failed to provide evidence and arguments to counter the business
x justifications offered by NYT and we do not find them so implausible as to warrant rejection on
x our own motion. Therefore, we conclude that INFONXX failed to sustain its burden of proof
on the issue of excessive rates under Section 201(b) of the Act.
" N @ ,T'T'33 "
X - x ` ` b. Alleged Unlawful Price Squeeze .
X -
x 17. INFONXX's allegations of an unlawful price squeeze suffer the same type of
x [ evidentiary infirmity we found in connection with the previous claim. INFONXX rests its price
x squeeze claims solely on the findings and conclusions of the NYPSC in comparing and
x [ contrasting NYT's wholesale intrastate EWP rate and NYT's Discount Plan for retail customers
X v -
x L in New York. We are not bound by the NYPSC's order as INFONXX contends A v ;
y O -
ԍx Nor is NYT precluded from presenting its arguments to the Commission under the doctrine of collateral
x estoppel as INFONXX contends. The following factors must be present before the doctrine of collateral estoppel
x Y applies: (1) there is an identity of parties; (2) there is an identity of issues; (3) the parties had adequate opportunity
x . to litigate the issues in the prior proceeding; (4) the issues were actually litigated and determined in the prior
{ O -
x K proceeding; and (5) the findings in the prior proceeding were necessary to the proceeding. Pantex Towing Corp.
{ O -
x h v. Glidewell, 763 F.2d 1241, 1245 (11th Cir. 1985). As discussed below, the doctrine of collateral estoppel does not
x < operate in the instant action for two reasons: (1) the issues in the NYPSC proceeding are not the same as those
x ; brought to the attention of this Commission; and (2) the determinations made by the NYPSC were not the result of
issues actually litigated. and conclude
x l that there is no basis in the record for finding that NYT's interstate EWP rate created the
unlawful price squeeze that INFONXX alleges.
x 18. Initially, we note that a price squeeze generally occurs when a vertically integrated
x company which has monopoly power at the wholesale level, but faces competition from its
x { wholesale customers at the retail level, sets its wholesale rates so high that its wholesale
X -
x = customers are unable to compete in the retail market. B ;
{ O " - ԍx City of Kirkwood v. Union Electric Co., 671 F.2d 1173, 1176, n.4 (8th Cir. 1982). In certain situations, a price squeeze is
X -
x evident, such as when a monopolist's wholesale rates exceed retail rates. C .
;
{ O - ԍx See City of Mishawaka v. American Elec. Power Co., Inc., 616 F.2d 976, 978 (7th Cir. 1980). By definition,
x naturally, a price squeeze determination requires an analysis of two sets of prices one at the
X -
x wholesale level and one at the retail level. L D ;
{ O - ԍx See id. at 983.L The crux of the case INFONXX presented to the
x NYPSC was that NYT had achieved a price squeeze by lowering its retail intrastate EWP rates
x without corresponding reductions in its wholesale intrastate EWP rates. Setting aside the question
x of whether the NYPSC could have properly considered the impact of NYT's interstate EWP rate
x in its price squeeze analysis, in any event it did not do so. Thus, the NYPSC's price squeeze
x findings are of little value to INFONXX in its attempt to show that NYT's interstate EWP rate
X - similarly created an unlawful price squeeze within the meaning of Section 201(b) of the Act. E $R
;
y O # -
ԍx Because the NYPSC considered only the impact of NYT's intrastate wholesale and retail EWP rates on
x = competition in New York state, we need not address INFONXX's claim that the Commission is bound by the
x NYPSC's findings. Moreover, the cases cited by INFONXX for this proposition are distinguishable from the facts
x in the instant action. In each of those cases, the administrative agency's decision was given preclusive effect because
x the issues were identical, and the parties were afforded a full and fair opportunity to litigate the issues. See " )& D ,T'T'`& "
{ O -
x Z University of Tennessee v. Elliot, 478 U.S. 788 (1986); Long Island Lighting Co. v. IMO Indus., Inc., 6 F.3d 876
{ O Z -
x K (2d Cir. 1993); Allied Chem. v. Niagara Mohawk Power Corp., 72 N.Y. 2d 271 (1988). As we stated above, the
x NYPSC decision did not involved the identical issue we are asked to address here, and the NYPSC decision was
based on a settlement which did not afford the parties a full and fair opportunity to litigate the issues. "
E ,T'T'33 " Ԍ
! ԙx 19. Having rejected INFONXX's reliance on the NYPSC's price squeeze determinations,
x < we find the remaining record inadequate to sustain a price squeeze analysis under Section 201(b)
x of the Act. For example, INFONXX contends, without elaboration, that to the extent that the
x NYPSC determined that NYT's EWP is a "bottleneck" or "essential service" for intrastate
x < competitors, we must find it to be a bottleneck service for interstate competitors as well. Without
x more, however, this conclusory argument does not adequately address counter assertions by NYT.
x N NYT has alleged that INFONXX's primary source for its directory assistance listings are
X _ -
x databases compiled by entities other than NYT. @ F _ ;
y O - ԍx NYT Brief at 8.@ NYT has submitted data which indicates that
X H -
x INFONXX does not use NYT as a primary source of directory assistance information. * G "HD ;
{ O = -
z ԍx See Id. at 11. NYT submitted data showing the number of requests by INFONXX for numbers in the New
x York area, as compared with the use of EWP by INFONXX. NYT claims that the data is based on INFONXX's
x K response to an interrogatory, and NYT records. NYT further asserts that it requested INFONXX to provide the
y O - specific number of instances in which INFONXX used EWP, but INFONXX refused to furnish the information. *
x INFONXX, charged with the burden of proof in this Section 208 proceeding, failed to provide
x evidence to refute NYT's contentions, arguing instead that the frequency with which it uses
X
-
x = NYT's database is not determinative of whether a bottleneck facility exists. Q H
.
;
y O - ԍx INFONXX Reply Brief at 12.Q While frequency
x of use may not be the sole determining factor in a price squeeze analysis, it certainly is a relevant
x factor, particularly when such frequency of use, as it appears in this case, is based on the
x availability of access to alternative sources. INFONXX's failure to make the threshold showing
x that the interstate EWP service is a bottleneck facility, prevents us from finding that an illegal
price squeeze existed.
O x 20. INFONXX's conclusory claim that the fact that it lost market share is evidence of
x an illegal price squeeze is similarly unavailing. We note that a Section 208 complainant alleging
x Z anticompetitive behavior has the burden of proving that defendant violated Section 201(b) of the
X -
x Act. I ;
{ O - ԍx See Panamsat Corp. v. Comsat Corp., Memorandum Opinion and Order, FCC 97172 (1997). It is unclear from the record why INFONXX believes that the reduction in NYT's local
x retail EWP rates has subjected it to a price squeeze in the interstate EWP market. In the absence
x of additional supporting facts and arguments about the interrelationship of the two rates, any
x determination we could make about the existence of a price squeeze based on INFONXX's
x K alleged lost market share would be speculative at best. Although the Commission has previously
x found that a monopoly provider of an essential service can subject its competitors to a price " P
I ,T'T'33R "
X -
x squeeze, " J ;
{ O y -
ԍx See Local Exchange Carrier's Rates, Terms and Conditions for Expanded Interconnection Through Virtual
{ O C - Collocation for Special Access and Switched Transport, Report and Order 10 FCC Rcd 6375, 6403 (1995)." in this case we do not find the possible existence of a price squeeze as a basis to
determine NYT's rates unjust or unreasonable under Section 201(b) of the Act.
x ` `
X -
N x 21. In a regulated environment, prices are set to reflect costs. To the extent this occurs,
x carriers are likely to squeeze competitors who buy from them at wholesale rates only if those
X -
x l competitors operate less efficiently, i.e., at higher costs. u K Z$ ;
{ O b -
ԍx Town of Concord v. Boston Edison Co., 915 F.2d. 17, 2526 (1st Cir. 1990) (court recognized that in a
x w regulated environment "a rule preventing prices that create a squeeze will more likely discourage efficient operations
and deprive consumers of prices that reflect lower costs.")u costs. An activity is not anti
X x -
x competitive merely because it causes a competitor harm. L xF ;
{ O o
- ԍx Id. at 21; Brown Shoe Co. v. United States, 370 U.S. 294, 320 (1962). Business activity, by nature, is
X a -
x designed to further a firm's fortune at the expense of its competitors. r M a ;
{ O - ԍx Town of Concord v. Boston Edison Co., 915 F.2d at 21.r A practice is deemed
x N anti-competitive to the extent that it harms the competitive process, thereby obstructing
X 3 -
x "competition's basic goals lower prices, better products, and more efficient methods." L N 3j ;
{ O N - ԍ x Id.L Based
x on the limited facts before us, we find no basis for declaring NYT's actions anti-competitive and,
therefore, violative of Section 201(b) of Act.
X - IV. CONCLUSION AND ORDERING CLAUSE ă
x 22. For the reasons stated above, we find that INFONXX failed to support its claims that
x the rates contained in NYNEX Tariff F.C.C. No. 1 between the period November 11, 1995, and
X { - July 6, violated Section 201(b) of the Act. O {
;
y O ( -
ԍx Because we find that NYT did not violate Section 201(b) of the Act, we need not address NYT's claim that
{ O - there can be no damages because it charged the filed tariff rate. See NYT Brief at 1617.
x " M V
O ,T'T'33g "
2 x 23. Accordingly, IT IS ORDERED pursuant to Sections 1, 4(i), 4(j), and 208 of the
x Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 208, that the abovecaptioned complaint filed by INFONXX IS DENIED.
x ` ` hh@FEDERAL COMMUNICATIONS COMMISSION
x ` ` hh@William F. Caton
x ` ` hh@Acting Secretary