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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) Kendall Telephone, Inc. ) Application For Authority To Acquire and) Provide Service Over 19 Local Exchanges ) NSD File No. W-P-C-7161 in Northern and Central Wisconsin ) Pursuant to 47 U.S.C.  214(a) ) Ameritech Wisconsin (Wisconsin Bell)) Application For Authority To Discontinue ) Service in 19 Local Exchanges in) NSD File No. W-P-D-429 Northern and Central Wisconsin ) Pursuant to 47 U.S.C.  214(a) ) Kendall Telephone, Inc. ) NSD File No. L-98-81 Request to Associate Exchanges With LATAs ) ORDER AND CERTIFICATE Adopted: July 30, 1998 Released: July 31, 1998 By the Deputy Chief, Network Services Division, Common Carrier Bureau: 1. On May 13, 1998, Kendall Telephone, Inc. (Kendall) and Wisconsin Bell, Inc. (Ameritech Wisconsin) filed a joint application seeking authority for Ameritech Wisconsin to assign section 214 authority to Kendall, under section 214(a) of the Communications Act of 1934 (the Act). This authority is sought so that Ameritech may sell and discontinue service, and Kendall may purchase and commence service, over 19 local exchanges serving 21 communities in parts of northern and central Wisconsin: Ashland, Bayfield, Cornell, Hurley, Ladysmith, Saxon, Stanley, Superior, Washburn, McAllister, Marinette, Oconto, Oconto Falls, Peshtigo, Baraboo, Berlin, Green Lake, Mazomainie, North Freedom, Princeton, and Redgranite. Kendall also requests that the exchanges be associated with their respective local access and transport areas (LATAs) following the transaction. On June 5, 1998, the Commission released a Public Notice accepting the joint application of Kendall and Ameritech Wisconsin for filing. No comments or opposition statements were filed in response to the Public Notice. 2. Ameritech Wisconsin also requests waiver of section 63.90 of the Commission's rules, which requires publication and posting of notices for discontinuance of service, stating that it and Kendall have announced the sale of the exchanges through a press release, sent letters to affected customers, and notified the Wisconsin Public Service Commission. Ameritech Wisconsin further requests waiver of section 63.505(l), which requires a discontinuance application to include information regarding toll messages sent-paid and received-collect for the service to be discontinued, stating that the Commission has routinely granted waivers of section 63.505(l) for the sale of an exchange between two telephone companies. 3. Ameritech Wisconsin serves approximately 2.2 million access lines and is wholly- owned by Ameritech Corporation. Kendall is a rural telephone company with 586 access lines, and is a wholly-owned subsidiary of Pacific Telecom, Inc., which in turn is a wholly-owned subsidiary of Century Telephone Enterprises, Inc. (Century). In Wisconsin, Century has approximately 245,000 lines in 96 exchanges, operates ten companies, and employs more than 830 employees; nationwide, Century owns over 600 local exchanges, serves 1.2 million local phone lines, and employs more than 5,600 employees, and its services include local exchange, exchanges access, wireless, long distance, voice mail, data services, security monitoring, and local Internet access in 21 states. 4. After the proposed transaction, customers in the 19 Wisconsin exchanges will have all the services currently provided by Ameritech Wisconsin, plus voice mail and local Internet dial-up access. Century will provide long distance service and will have approximately 330,000 access lines, or approximately 10 percent of the total lines in Wisconsin, in 115 Wisconsin exchanges. Kendall will have fewer than three percent of the access lines in Wisconsin. 5. 214 Requests. In their section 214 authority requests, Ameritech Wisconsin and Kendall submit that the sale of the exchanges will serve the public interest by improving and expanding telecommunications services in Wisconsin's rural areas. They state that Century estimates it will invest more than $15 million in the exchanges in the first three years following the transaction, to upgrade the switching facilities, bring them on par with Century's other exchanges in Wisconsin, enable the provision of advanced services, and make other capital improvements. Having reviewed the application, we find that the application complies with the requirements of section 214(a) of the Act and Part 63 of our rules. We further find that, for the reasons stated in the application, the transaction will serve the present or future public convenience and necessity. 6. LATA Association Request. In its LATA association request, Kendall seeks new associations for the 19 exchanges, which are presently not associated with any LATAs but are BOC-operated within Ameritech Wisconsin LATAs. In the AT&T Consent Decree, the Court divided all BOC territory in the continental United States into LATAs and limited the BOCs to intraLATA service. The Court also classified most independent telephone company (ITC) exchanges as "associated" with particular BOC LATAs, so that traffic between the LATAs and the associated exchanges would be considered intraLATA and the BOCs could carry the traffic without costly network rearrangements. Today, as the Commission observed in its LATA Association Order, section 271 of the Act continues to prohibit BOCs from providing interLATA services until certain enumerated conditions are satisfied, except that, as the Court allowed, they may carry traffic between LATAs and associated independent exchanges under the grandfathering provisions of section 271(f). The Commission established guidelines to assist ITCs and BOCs in filing LATA association petitions, specifying the required categories of information that LATA association petitions must include. Kendall has submitted information that comports with the specified categories. Its submission includes: the type of request, exchange information with identification of the names of the exchanges and their corresponding LATAs, the number of access lines for each exchange, a public interest statement, a map showing the 19 exchanges in relation to each other, and a BOC supplement by which Ameritech Wisconsin concurs in the requested LATA association. 7. We find that Kendall's requested LATA associations are consistent with the Act and serve the public interest. The Commission is careful not to authorize LATA modifications and associations that would circumvent the requirements of Section 271 or be disruptive of local dialing patterns. In the present case, such concerns do not exist, because the 19 exchanges are currently within Ameritech Wisconsin LATAs, and after they are transferred to Kendall there will be no disruption of continued intraLATA traffic between the exchanges if they are associated with their current LATAs. 8. Accordingly, IT IS ORDERED, pursuant to section 214(a) of the Act, 47 U.S.C.  214(a), and the authority delegated in sections 0.91 and 0.291 of the Commission's rules, 47 C.F.R.  0.91 and 0.291, that the requests for waiver of the requirements of 47 C.F.R.  63.90 and 63.505(l) ARE GRANTED, that the applications for authority in No. W-P-D-429 and No. W-P-C-7161, respectively, for Ameritech to discontinue service and for Kendall to acquire and provide service over 19 local exchanges in Wisconsin ARE GRANTED, and that the request by Kendall in No. L-98-81 that the exchanges be associated with their respective local access and transport areas following the transaction IS GRANTED. Ameritech Wisconsin IS AUTHORIZED to assign to Kendall its section 214 authority to provide service over the local exchange facilities described above. 9. IT IS FURTHER ORDERED that grant of this application IS SUBJECT TO THE CONDITION that Ameritech Wisconsin and Kendall receive approval of their Petition for Waiver of the Definition of "Study Area" contained in Part 36 of the Commission's rules, 47 C.F.R. Part 36, and sections 61.41(c), 69.3(e)(6), and 69.3(g)(2), 47 C.F.R.  61.41(c)(2), 69.3(e)(6), and 69.3(g)(2), relating to this transaction. 10. This Order and Certificate IS EFFECTIVE upon release. Failure of the applicants to decline the authorization in writing within thirty-one days from the release date will be construed as formal acceptance. FEDERAL COMMUNICATIONS COMMISSION Anna M. Gomez, Deputy Chief Network Services Division Common Carrier Bureau